The Estrin Report

"Is Software the Key to Streamlining HR?"

This Legal Technology article describes the HR challenges in law firms & how various software options makes them manageable. [2nd paragraph links from original text]:

"Managing human resources is one of the most labor-intensive processes at a law firm. Keeping track of payroll, benefits, leave time and lots of other information is time-consuming and costly. Fortunately, there is plenty of software -- both commercial and homegrown --that can help firms automate many HR functions. Firms that are using these tools are seeing benefits, such as cost savings and increased efficiency.

BINGHAM MCCUTCHEN

"Bingham McCutchen, with nine U.S. offices and three overseas, has 950 attorneys and 1,150 executives and support staff. In the mid-1990s, the firm began using an HR tracking and analysis system called HRVantage, from Spectrum Human Resource Systems Corp.. The system helps the firm to track and report on HR-related tasks including new-hire processing, employee status, benefits enrollments, employee history and performance/salary reviews."

"MoFo IT Gets Its Green On"

Kudos to Morrison & Foerster for adopting a strong 'green' culture! Find four good ideas in this Legal Technology article:

"With 1,070 lawyers in 18 offices throughout the world, Morrison & Foerster has a culture that promotes excellence, diversity, teamwork and social responsibility. Last year, we were selected as one of Fortune magazine's '2006 Best Companies to Work For,' and the firm has won numerous other accolades that reflect our commitment to these goals.

"Among these priorities is our commitment to create a work environment that is healthy and environmentally responsible. Our IT department has initiated a number of programs designed not only to help to minimize our impact on the environment, but also generate real savings. Here are a few of our recent programs:

1. CRT to LCD

"Our first project was designed to save desktop space, as well as eyes and power. Over the last four years, we have significantly reduced our power consumption in our offices and data centers by replacing all cathode ray tube monitors with liquid crystal display units. LCD monitors consume less power and have a longer life than CRT monitors. As a result, we have saved roughly 619 megawatts of power per year -- enough to power 58 average American homes for one full year."

Author Anthony Hoke is global technology purchasing/asset manager at Morrison & Foerster, based in Los Angeles.

"National Firms Stake Claim in Phoenix's Robust Economy"

Hmm, ever thought about moving to Arizona? Sounds like firms in Phoenix are heating up!

"It may be a dry heat in Phoenix, but it's also a hot legal market for some national law firms moving into the desert city to take advantage of the region's flourishing economy.

"Ranked the fifth-largest city in the nation with 1.5 million people at the center of a metropolitan area of 3.8 million, Phoenix has the fastest-growing population of any major U.S. city, with professional and technical jobs creating the biggest surge in its employment sectors.

"Law firms new to the area want a piece of the thriving hospitality, real estate, construction, aerospace and electronics industries. But the influx of national firms means that some firms with long-standing practices in Phoenix are feeling a pinch from the competition.

'The large national firms are competing for a relatively small number of people,' said Elliott Portnoy, chairman of Sonnenschein Nath & Rosenthal. The 658-attorney firm opened a Phoenix office in June 2006 with seven lawyers from Squire, Sanders & Dempsey."

"Boston law firm plans San Diego expansion"

Oh, boy, firms expanding & lawyers changing firms. See the details in this San Diego Union-Tribune news article:

"The Boston law firm Goodwin Procter has recruited prominent local biotechnology lawyer Stephen C. Ferruolo to launch an office in San Diego as part of the firm's push into California.

"Stephen C. Ferruolo is expected to take much of his client base with him.
Ferruolo, 56, has been a highly visible face for Heller Ehrman, one of the few one-stop-shopping law firms for San Diego's biotechnology companies. He is also vice president and general counsel for Biocom, the region's biotechnology industry organization.

"Also leaving Heller Ehrman's life sciences practice for Goodwin Procter are partner Ryan Murr, several associates and a paralegal."

Nice to see the mention of a paralegal moving too; better, of course, if that person had also been named...

"Firms Predict More Work, Less Equity"

What does this news mean for paralegals? I'm guessing higher required billable hours & maybe higher salaries too:

"Although law firm leaders at a recent conference publicly pooh-poohed predictions that industry profitability would stumble, in a new survey they say increasing expenses will cut into their bottom line this year.

"Lawyers can expect to be pushed for more billable hours while facing a harder struggle to make equity partner. And the ranks of associates and nonequity partners will rise much faster than any increase in equity slots, law firm leaders said.

"The first managing partner confidence index [be sure to check the comments to this post!] -- a survey of more than 100 Am Law 200 firm leaders -- was released this week by Citigroup Private Bank, which serves as banker to 550 law firms, including many of the nation's largest.

[snip]

"Am Law 200 firms reported big growth last year. But while most respondents predict revenue will continue to climb, they also expect expenses -- led by lawyer salaries -- to do the same. More than 90 percent said lawyer salaries would be the primary rising cost this year -- and that was before the recent round of associate salary raises that brought first-years up to $160,000 in New York and $145,000 most everywhere else.

[snip]

"Non-lawyer staff salaries and real estate costs are also expected to grow at a faster clip [emphasis added] than last year, [Danilo DiPietro, client head of Citigroup's law firm group] said."

Survey Shows Strong Financial Support for Technology in Legal Budgets

Well, this is good news for legal organizations & tech-oriented paralegals!

"Gone are the days of pleading with law firm partners and in-house counsel about the efficiency and ease that computers bring to a legal practice. The 2007 Survey on Technology Budgeting and Spending [PDF], conducted at LegalTech New York, shows strong sustained support for technology in law firm and legal department budgets. Edge Legal Marketing, a premier provider of marketing and public relations expertise to companies targeting the legal market, today released the results from its 2007 attendee survey conducted at the conclusion of LegalTech New York. This year’s conference was held January 29-31 and attracted 12,000 attendees from New York and around the world, including law firm and corporate attorneys, their support staff, and IT professionals, in addition to hundreds of vendors serving the needs of legal professionals."

"Top Law Firms May Face Rough Future"

It's certainly smart to face this possibility now, right? Even if the law biz doesn't cool:

"Will the good times cease to roll for leading law firms?

"With some gloom -- though not so much doom -- industry observers forecasted a cooling of the legal market over the next five years at the Law Firm Leaders Forum, held Thursday and continuing today in San Francisco. Ever-increasing pressure on rates from clients, rising costs, including the recent hike in associate salaries, and segmentation of the marketplace will make it hard for firms to maintain robust growth -- especially of their bottom lines, they said.

"'There are a lot of red flags waving right now,' said Bradford Hildebrandt, a law firm consultant with Hildebrandt International. 'I would be starting to plan for an economic correction.'"

"Corporate Groups Enjoy the Boom but Plan for the Bust"

Corporate lawyer hiring directly affects corporate paralegal hiring. Tighten your seat belts; it's going to be a bumpy ride!

"It has been a bull market for corporate lawyers, with multimillion- and billion-dollar M&A deals galore. But the recent stock market plunge sent a little chill down the backs of some, a reminder that the high times won't last forever. A day after trouble in the China market dropped the Dow more than 400 points, Fenwick & West corporate group Chairman Daniel Winnike said he was relieved Wall Street had stabilized.

"'If it had dropped another 300 points,' he said, 'then some of the companies might have had second thoughts about some of the M&A deals we're working on.'

"Corporate law leaders like Winnike remember well the dot-com bust that forced layoffs at such star Silicon Valley firms as Fenwick & West, Cooley Godward, Venture Law Group (now with Heller Ehrman) and Gray Cary Ware & Freidenrich (now DLA Piper) five years ago. As they have built up their departments in this economic upturn, they're applying two key lessons: Diversify your practices [PDF] and hire smarter."

"Firms Hire Nonpracticing Lawyers in Manager and Support Roles"

Well, this is interesting. Think it will hurt paralegal advancement into these positions?

"Ron Friedmann posts on a new trend at large firms: use of nonpracticing lawyers as managers. He writes that firms now hire nonpracticing lawyers for jobs such as marketing, e-discovery, knowledge management, professional development and practice support. There are some pitfalls, of course, as Friedmann points out:

"Either way, firms must exercise some caution. First, they must 'be careful of what they ask for, lest they get it.' For example, some churn in CMO and CIO positions in recent years likely stems from initial excitement followed by balking when the firm learns what’s really involved. Second, they need to consider how to integrate the non-practicing lawyer and any team reporting to him/her. Thinking this through requires a realistic assessment of a firm’s culture and the strength of its caste system. And third, they need to allocate risk fairly between the firm and the new role: negotiate a graceful exit strategy for both the firm and individual if things don’t work out."

"Complicated End of an Ex-Law Firm"

Yeah, law firm breakups spawn messy news. Almost as bad as a divorce:

"At one time, the breakup of a big, prestigious law firm was rare. But since the technology boom and bust, implosions of once highflying firms like Brobeck, Phleger & Harrison and Testa, Hurwitz & Thibeault have occurred with more frequency.

"Yet the bankruptcy of Coudert Brothers still stands out. Eighteen months after the firm voted to dissolve, its unwinding continues to be a complicated, messy affair.

"Creditors and at least one former partner have filed lawsuits against the firm. Malpractice claims have accrued as well. There are allegations in court filings that three overseas lawyers sequestered money from the firm as it tried to pay off its creditors."