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Backbone of the Profession
Small law firms (“SLFs”) are the backbone of our profession. SLF are practices with less than six lawyers. SLFs form the majority of law practices and perform the bulk of the work that provides access to justice. At the end of 2016, 742 out of 879 law practices were SLFs. Out of 219 law practices involved in Pro Bono Services Office initiatives, 127 were SLFs. Out of 205 law practices involved with the Criminal Legal Aid Scheme, 121 were SLFs.
In 2011, at his Opening of the Legal Year (“OLY”) address as President of the Law Society (“LawSoc”), Senior Counsel Wong Meng Meng called SLFs the life-blood of a modern society. SLFs are avenues by which the less advantaged members of society can have access to justice. He said for access to justice to be meaningful, SLFs must upgrade themselves.
Champions for the Community
In 2013, the 4th Committee on the Supply of Lawyers acknowledged that SLFs practise a greater amount of community law. The Committee then predicted a shortage in supply for lawyers in areas of family and criminal law and the UniSIM Law School was later established to train lawyers in these areas. In 2014, the Committee to Study Community Legal Services proposed legislative amendments to introduce mandatory reporting of pro bono hours. Lawyers renewing their practising certificates will have to report on their pro bono hours completed in the preceding year.
Small Law Firms Must Thrive
Since SLFs are central to the access to justice, ensuring their success is important. Senior Counsel Thio Shen Yi pointed out in his OLY 2015 address that SLFs are indispensable and the proper function of the rule of law requires strong and thriving SLFs.
The practice of law today is no longer just a vocation. SLFs are businesses. They need to be profitable before they can go forth and save the world. Like the pre-flight safety briefings onboard aeroplanes, we need to put on our own oxygen masks before helping others with theirs.
Whilst encouraging pro bono work, continuing professional development (“CPD”), raising ethical and practice standards and teaching young lawyers criminal law and family law are important, ensuring the survival of SLFs is equally important.
Unlike bigger firms, lawyers running SLFs need to multi-task. SLFs usually do not have the luxury of a dedicated team of staff to look into matters of accounts, marketing and human resource but getting these matters right are vital for the sustainability and success of a SLF. Competency in business does not come naturally to lawyers. Law schools traditionally do not teach business skills. They teach students technical skills and train them to think like lawyers to solve legal issues. Lawyers are conditioned to be technicians not entrepreneurs.
Learning the Right Skills to Succeed
In tandem with the focus on skills, productivity and standards, lawyers in SLFs must see themselves as running businesses and acquire the necessary skill sets. Courses in law school and CPD in this area will certainly help. Lawyers running SLFs will be well advised to mind their own businesses, to work on their practices and not just in them. While striving to be ethical, effective and socially responsible lawyers is paramount, lawyers must also commit to learning the necessary business skills to help their SLFs succeed.
In his OLY 2017 speech, LawSoc President Gregory Vijayendran reported that LawSoc collaborated with the Ministry of Law last year to embark on a detailed industry study to understand the business models and level of technology adoption by SLFs. One of the findings in the report of Eden Strategy Institute, the consultants engaged for the study, (“Eden Report”) was that a crucial issue requiring change is business acumen. There is a strategic imperative for SLFs to build business know-how.
It is submitted that there are at least four areas that SLFs must improve on.
Know Our Numbers
Firstly, we must know our numbers.
Do we know how much money is needed to run our SLFs in a given month? How much do we need to collect daily to be able to draw the amount we intend to take home at the end of the month? What is our current cash flow position?
If we do not stay on top of these numbers, we are unlikely to be disciplined in marketing or collections. It is common to hear of SLF lawyers working on matters for three months before rendering their bills and then taking three more months to get clients to pay what has been billed. This begs the question of what these lawyers would have been living on in those six months.
Ignorance of our numbers is not bliss. Leaving them to chance can lead to financial ruin or worse, the inability to practise or run a practice.
It’s All About Value
Secondly, we must understand value.
It is not enough to be competent in our legal technical skills. These are basic. Otherwise, we have no business meddling with a law practice. CPD goes only towards maintaining this baseline requirement.
To thrive as businesses, we must know what value we bring to the market place. If given a choice, why would a client willingly pay one lawyer $250 an hour and another $500 an hour? Surely it is not about the number of PQEs the latter has accumulated. It is about the value-add the lawyer brings to the table, to entitle him to earn twice as much as another.
In order to compete, SLFs must be able to identify the unique value propositions they offer. Otherwise, it is high time to acquire them. Without a unique value proposition, SLFs may have no choice but to compete on price. That brings everyone on a downward spiral.
Only when a SLF is able to say with precision what its value-add is, any marketing effort by it is a futile exercise.
Thirdly, we must leverage on technology.
The Eden Report also found that there are good practices with proven impact. For example, going paperless and running a virtual office reduced 66 per cent of the operating costs and a shared database of precedents and past case knowledge as a means to develop lawyers’ specialised domain knowledge had a 40 to 50 per cent time savings for the lawyers concerned.
To assist SLFs to embrace technology, a $2.8 million Tech Start for Law programme was launched in February this year by the Ministry of Law, LawSoc and Spring Singapore to provide funding support for SLFs to adopt baseline technologies in practice management, online research and marketing. LawSoc also launched the SmartLaw Assist scheme in March to provide SLFs with 70 per cent subsidy in initial costs for an online knowledge database.
With this help available, SLFs should not hesitate to embrace technology to level the playing field between them and the bigger firms.
Lastly, we must learn to multiply ourselves.
The lawyers behind the SLFs are mere mortals. We all age and with age, memory and energy will both decline. Our ability to take on briefs will decline too. With this decline, in order to sustain ourselves, SLF lawyers will either lower our expectations or become more expensive. Neither of these options are realistic.
The logical solution would be to delegate delegable work, either to well-trained paralegals or junior lawyers. This opens a whole new area of knowledge that SLFs must avail themselves of: staff training and retention strategy. Whilst some of the training for technical skills can be delegated to the LawSoc’s CPD department or other training providers, retention strategy is something that the SLFs must intentionally apply their minds to. Failing to do so will result in juniors or reliable staff members leaving us after they have learnt the ropes such that we keep having to re-invent the wheel. There is a need for SLFs to understand the aspirations of juniors and staff members, so that we can add value to them as much as they add value to us. Only then would they willingly help us grow our pies and stay in business.
Mind Our Own Businesses
These know-hows are merely the tip of the iceberg. No matter how busy we are, we need to carve time out to learn these things to make sure our SLFs are a going concern.
If we cannot fend for ourselves, we cannot meaningfully honour our oaths as advocates and solicitors to pursue justice and to do right.