Over the last ten Years, we have witnessed improvements in law practice technology, the expanding roles of paralegals, and the outsourcing of legal work. Yet despite all these cost-cutting and time-saving benefits, many law firms, especially the big ones, stay struggling for their own survival. a decade ago, law firms were enjoying remarkable levels of growth and prosperity. Business coffers were full and companies were spending substantial amounts of money on promoting themselves to be able to enter new markets and obtain premium business. Some firms even started experimenting with branding. In these days, branding was largely viewed as another form of marketing and promotion. In fact, firm leadership rarely knew the branding process or what the notion of branding was actually meant to accomplish.
However, it did not really matter, earnings were climbing and profitability remained strong. But what so many of these companies did not anticipate was that, in only a couple decades, our economy could be shaken by a fierce and deep recession, one that would shake the fiscal foundations of the most rewarding of firms. For law firms, the Recession that started in 2007 had, by 2010, penetrated the most sacred of lands – the proverbial benchmark of a company’s standing and accomplishment – profits-per-partner. For many companies, especially mega-firms, the decrease in law spouse profits were reaching record lows and it was not long before the legal landscape was littered with failed companies both large and small. In trying to deflect further losses, firms started to lay off partners and staff in document number. However, the problems went much deeper. There simply were too many lawyers and not enough superior work to go around. It was a clear instance of overcapacity, and it was clear it was not going to improve anytime soon.
More than twelve of the country’s major Stephens Law Firm, with more than 1,000 partners between them, had completely collapsed in a period of about seven decades. Against this background, law schools were still churning out tens of thousands of eager law graduates each year. Highly trained young women and men that were starved for the opportunity to go into a profession that once held the promise of wealth, stability and status as partner profits Dwindled, spouse infighting grew rampant. Partner would compete against spouse for the identical piece of business. The collegial team-driven identity and progressive culture that firms spent millions of dollars encouraging as their company’s unique brand and civilization had vanished as fast as it had been created while fiscal times were tough, in fact many of the large companies had the funds to survive the recession. Rather, partners with large books of business were choosing to take what they could and joined other companies – demoralizing those left behind.