The current inflection point in the legal services marketplace is “really exciting”, Maddocks partner and chief executive David Newman says, not just because of the benefits of the tech revolution, but also given how it is reshaping age-old operational structures for practitioners.
In a recent episode of Legal Firesides, produced exclusively for subscribers to Lawyers Weekly Premium, Newman reflected on leading a national law firm in years of such significant environmental and technological change, and the duty to improve the experience of all practitioners.
As part of that conversation, he touched on how law firms like his can move to different billing models, so as to ensure practitioners can pivot to being more trusted advisers for clientele.
It’s a “really interesting time” in the Australian legal market for firms like Maddocks, he said, given how many of the national and global firms that operate Down Under are “moving away from BAU work and tending to move to high value transactional work and high profitable work”.
This is something that Maddocks is looking to leverage and take advantage of, he said, for example through certain firms withdrawing from the Commonwealth legal services panel, thereby presenting a “significant opportunity” to continue growing its government practice.
More broadly, Newman sees the benefits of the age of AI as being not simply benefits for clients, firms, and the bottom line – the benefits will be for the practice of law in general, by way of greater access to justice.
“Individuals [currently] can't afford to run litigation in superior courts in Australia, and , if we can remove some of the time and costs associated with that, then we're going to see, I think, we'll be more work effectively for lawyers, not less,” he said.
It is also exciting to see how collegiate the profession is when it comes to the AI transition firms are going through, he mused, in that “we're going through it together”.
But one of the greatest benefits associated with the current inflection point, Newman said, is the conversations being had with clients about moving to different billing models.
“We talk about pressures on lawyers and mental health and, you know, things that perhaps, perhaps diminish a sense of purpose in some ways. And timesheets we all know is one of those,” he said.
“It obviously is a bit daunting for everyone. The rapid change of pace, I think, is probably the most complex thing that leaders need to deal with at the moment. It's not as though we've got the luxury of dealing with the technology being implemented over time and evolving over years. The large language AI models evolve over weeks or months, not years. And so, I think that that pace of change is often the challenge and bringing people along with that change can be a bit hard.”
When asked whether he, as the head of a national law firm, has to be open-minded and adaptable to the possibility that timesheets and billable units will be discarded, given the ongoing changes to operational processes, Newman said: “100%.”
“We have to look at ways where we do move to models that better reflect the value that we bring to our clients. And I think there would be agreement across the profession and across all of our clients that the billable hour isn't the optimal way of billing our clients,” he said.
This said, Newman added, “we haven't been able to come up with an arrangement with our client base more broadly as a profession that is acceptable or works better”.
“We're moving to a lot more of the work that we do might be task based or might be on a retainer base, but still the majority of work that most law firms do, including us, would be on an hourly basis.”
As a result, he said, the reality is that law firms like Maddocks will have to move towards a model where they are charging for tasks in a different way.
“I think the benefit of that, in addition to removing the requirement of filling in timesheets every day, is how we then train our lawyers to be that trusted advisor or be that problem solver or be that commercial partner more quickly,” Newman said.
“As you know, traditionally law is one of the true professions [that] has had a sort of a master and apprentice type model, where lawyers would spend time with senior practitioners and they'd observe how they communicate with clients, they'd observe how they write, they would, they would observe how they give advice in the commerciality and then they would progress through and press a partnership if they so choose themselves. I think the practice of law has become more complex, because of the volume of documentation we're required to work through, that model's changed a bit.”
Most large firms, he said, have outsourced that training in a different way.
“Our graduates are trained in a very different way than I was trained. And clients don't like having meetings with 10 lawyers turning up and sitting around the table. But, but if we move to a model that's more value build rather than on timesheets, then we have more opportunity to bring junior lawyers, graduates, to meetings and to allow them to sit in with partners or senior lawyers and observe how they deal with clients and how they solve problems.”
To this end, Newman said, “there's a whole lot of benefits” that can and will flow from not just removing the requirement to record one’s working day in six-minute increments, but also in how lawyers coming through the ranks are being trained, and how they will evolve and develop as lawyers of the future.
To listen to the full conversation with David Newman, click here. This episode is available only to subscribers of Lawyers Weekly Premium.
Jerome Doraisamy is the managing editor of Lawyers Weekly and HR Leader. He is also the author of The Wellness Doctrines book series, an admitted solicitor in New South Wales, and a board director of the Minds Count Foundation.
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