Legal Blog Watch: "Pressure to Cut Costs Drives More Work to India"
The statistics in this article are grim, if you are a US based major law firm. I am reminded of the 2008 Presidential Summit at the Annual Meeting of the New York State Bar Association. One of my co-panelists, Mary C. Daly, the Dean of St. John's Law School in Jamaica, New York, who, unhappily passed away a few days ago, emphatically said, to the surprise of many in the audience, that no serious law firm could ignore outsourcing more routine legal work to India. There were some caveats, of course, but the need to cut costs would drive the process she said. Now we are talking about the loss of 35,000 legal jobs within the span of a bit more than a year and 79,000 in a bit more than six years. I think this is even faster than Dean Daly envisioned.
Wednesday, November 26, 2008
Monday, November 24, 2008
Law.com - Some Glimmers of Sunshine for Law Firms, Say Citi Experts
Law.com - Some Glimmers of Sunshine for Law Firms, Say Citi Experts
This is an article that requires some careful study and analysis. A look at the underlying data might also be necessary to do that properly. Aside from indicating that there might be some pain coming, it is interesting to note that firms with more than 25% of their lawyers abroad (note Nixon Peabody's recently announced objective) seem to be weathering the storm without too much difficulty. However, large New York based firms and firms with a lesser foreign presence seem to be bearing a much heavier burden. I continue to wonder how long overseas offices are going to be an economic benefit in these uncertain economic times.
This is an article that requires some careful study and analysis. A look at the underlying data might also be necessary to do that properly. Aside from indicating that there might be some pain coming, it is interesting to note that firms with more than 25% of their lawyers abroad (note Nixon Peabody's recently announced objective) seem to be weathering the storm without too much difficulty. However, large New York based firms and firms with a lesser foreign presence seem to be bearing a much heavier burden. I continue to wonder how long overseas offices are going to be an economic benefit in these uncertain economic times.
Sunday, November 23, 2008
Anarchy in the UK: More Layoffs Coming
Anarchy in the UK: More Layoffs Coming
Do you get the feeling that this is only the tip of the iceberg? Regrettably, the onset of the current economic uncertainties was very swift. As these uncertainties ripple through all business sectors, it is hard not to imagine they are also going to hit the practice of law at all levels. Weaker practices will probably feel it first, but all most certainly will. Those practices that prepare for the inevitable will no doubt attract more attention as they do so, but, in the long run, they will be stronger for it and will survive better.
Do you get the feeling that this is only the tip of the iceberg? Regrettably, the onset of the current economic uncertainties was very swift. As these uncertainties ripple through all business sectors, it is hard not to imagine they are also going to hit the practice of law at all levels. Weaker practices will probably feel it first, but all most certainly will. Those practices that prepare for the inevitable will no doubt attract more attention as they do so, but, in the long run, they will be stronger for it and will survive better.
Lawyers Wanted - Abroad, That Is - NYTimes.com
Lawyers Wanted - Abroad, That Is - NYTimes.com
This is an interesting article, not just because it mentions my son by name, but because it puts a different spin on overseas offices. Also notable is the chart and the mention that foreign law firms cannot have an office in India. That is going to have to change.
As a practical matter, it is probably much easier to have a young lawyer without a wife and family take an assignment abroad. There is a lot less to manage when you are just moving one versus a family with young children, some of whom might be school age. Also, when you move a family, it may require a longer term commitment than moving a single lawyer.
Underlying all this, however, is the impact of the current economic climate. At the moment, there may be a shortage of qualified talent abroad, but, if the economic uncertainties continue to spread, this may change. For the young lawyer who has been abroad, it may be difficult to repatriate, because, if for nothing else, out of sight, out of mind. The associates who stayed at home will probably have superior chances to remain on board.
This is an interesting article, not just because it mentions my son by name, but because it puts a different spin on overseas offices. Also notable is the chart and the mention that foreign law firms cannot have an office in India. That is going to have to change.
As a practical matter, it is probably much easier to have a young lawyer without a wife and family take an assignment abroad. There is a lot less to manage when you are just moving one versus a family with young children, some of whom might be school age. Also, when you move a family, it may require a longer term commitment than moving a single lawyer.
Underlying all this, however, is the impact of the current economic climate. At the moment, there may be a shortage of qualified talent abroad, but, if the economic uncertainties continue to spread, this may change. For the young lawyer who has been abroad, it may be difficult to repatriate, because, if for nothing else, out of sight, out of mind. The associates who stayed at home will probably have superior chances to remain on board.
Friday, November 21, 2008
Patent Services Outsourcing to India Hits $46 Million
Patent Services Outsourcing to India Hits $46 Million
If anyone doubted that outsourcing to India was not something we had to reckon with, they will have to think again. As more law firms come under pressure from clients to contain fees, and more general counsel look for ways to reduce dependence upon their traditional suppliers of legal services, outsourcing to India and elsewhere looks as if it is starting to look better and better. This is by no means an endorsement of the trend. There are many problems inherent in outsourcing, and we have not even begun to discover what they are or could be.
If anyone doubted that outsourcing to India was not something we had to reckon with, they will have to think again. As more law firms come under pressure from clients to contain fees, and more general counsel look for ways to reduce dependence upon their traditional suppliers of legal services, outsourcing to India and elsewhere looks as if it is starting to look better and better. This is by no means an endorsement of the trend. There are many problems inherent in outsourcing, and we have not even begun to discover what they are or could be.
Law.com - In Surprise Move for Troubled Times, DLA Piper Asks Partners to Contribute Capital
Law.com - In Surprise Move for Troubled Times, DLA Piper Asks Partners to Contribute Capital
Whether this move is unprecedented or not, the comments from the bankers clearly show the need to keep a close eye on these developments. If we are at the beginning or the middle of the credit "crisis" rather than at the end, those "many law firms that have dug deeper into their credit lines this year" will no doubt be headed toward greater problems as time passes. Also, with many firms borrowing "more than 30 percent over last year," they are bound to run into resistance, if they need to increase their borrowings in the future. Notably, DLA, which is sometimes referred to as the world's largest law firm does not seem to have benefited from its geographic exposure. This is not a surprise, because the firm's centers of gravity are in the more significantly affected world economies, and the current economic climate is affecting virtually all world economies in any event.
Whether this move is unprecedented or not, the comments from the bankers clearly show the need to keep a close eye on these developments. If we are at the beginning or the middle of the credit "crisis" rather than at the end, those "many law firms that have dug deeper into their credit lines this year" will no doubt be headed toward greater problems as time passes. Also, with many firms borrowing "more than 30 percent over last year," they are bound to run into resistance, if they need to increase their borrowings in the future. Notably, DLA, which is sometimes referred to as the world's largest law firm does not seem to have benefited from its geographic exposure. This is not a surprise, because the firm's centers of gravity are in the more significantly affected world economies, and the current economic climate is affecting virtually all world economies in any event.
Friday, November 7, 2008
Law.com - Hungry Nixon Set to Hire as Many as 100 From Thelen
Law.com - Hungry Nixon Set to Hire as Many as 100 From Thelen
Once again, we have an article that states Nixon's objective of having one-quarter of its attorneys outside the United States within five years. This is a very tall order, and, unless there is a very good reason for doing this - such as significant existing business or documented need - it is probably a very high risk move. It is almost axiomatic that every large firm thinks it needs a strong collection of branch offices in most, if not all, of the major world markets. However, this can be extremely costly, and, without good business justification, simply a waste of money that could be better employed elsewhere. I continue to believe that it is difficult to have every branch office, particularly, a foreign branch office reflect the same high standards of the major domestic office or offices. With such rapid growth, it is almost certain that the foreign branch offices are going to have to have considerable care and supervision to integrate them properly into the fabric of the firm.
Once again, we have an article that states Nixon's objective of having one-quarter of its attorneys outside the United States within five years. This is a very tall order, and, unless there is a very good reason for doing this - such as significant existing business or documented need - it is probably a very high risk move. It is almost axiomatic that every large firm thinks it needs a strong collection of branch offices in most, if not all, of the major world markets. However, this can be extremely costly, and, without good business justification, simply a waste of money that could be better employed elsewhere. I continue to believe that it is difficult to have every branch office, particularly, a foreign branch office reflect the same high standards of the major domestic office or offices. With such rapid growth, it is almost certain that the foreign branch offices are going to have to have considerable care and supervision to integrate them properly into the fabric of the firm.
Law.com - London Firms Post Solid Financials as Rest of U.K. Starts to Feel the Pinch
Law.com - London Firms Post Solid Financials as Rest of U.K. Starts to Feel the Pinch
With the exception of Trowers, which mentioned it Middle East practice, there is very little indication in this article about the reasons why some firms have enjoyed more success than others. This data warrants further study to see where the various contributions to earnings come from. It could also be that some firms, rather than having a better geographical placement of their practice have a better practice mix. We already know that real estate is causing problems for some London firms. Perhaps, the better performing firms have less involvement with real estate and more with other, more profitable, areas, such as IP. Certainly, there will be more data along these lines coming.
With the exception of Trowers, which mentioned it Middle East practice, there is very little indication in this article about the reasons why some firms have enjoyed more success than others. This data warrants further study to see where the various contributions to earnings come from. It could also be that some firms, rather than having a better geographical placement of their practice have a better practice mix. We already know that real estate is causing problems for some London firms. Perhaps, the better performing firms have less involvement with real estate and more with other, more profitable, areas, such as IP. Certainly, there will be more data along these lines coming.
Thursday, November 6, 2008
Law.com - Top U.K. Firms Say They Could Cut Jobs in Next Six Months
Law.com - Top U.K. Firms Say They Could Cut Jobs in Next Six Months
The article is not very specific about where the cuts are to come, other than to suggest that real estate would be the hardest hit. That could indicate the cuts are coming in domestic real estate, but many of these firms have global real estate practices. This bears watching, because there is probably a lot more coming, and it will probably be firm wide.
The article is not very specific about where the cuts are to come, other than to suggest that real estate would be the hardest hit. That could indicate the cuts are coming in domestic real estate, but many of these firms have global real estate practices. This bears watching, because there is probably a lot more coming, and it will probably be firm wide.
Wednesday, November 5, 2008
Law.com - Miller Canfield Opens New Office in Shanghai
Law.com - Miller Canfield Opens New Office in Shanghai
It takes real courage in these difficult economic and uncertain times to open a foreign branch office. However, the IP area, the main focus of Miller Canfield's new Shanghai office, is an up and coming field, particularly in China.
It takes real courage in these difficult economic and uncertain times to open a foreign branch office. However, the IP area, the main focus of Miller Canfield's new Shanghai office, is an up and coming field, particularly in China.
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