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If we say firms need to do something different, what does “different” mean? For as long as I've been in this industry, law firms have been struggling to improve their financial performance. For those of us who were in-house, we know that aggressive cost-cutting measures were generally the first steps that were taken to improve bottom-line performance metrics.
For those firms that weren't serious about cost-cutting before 2008, they likely became converts shortly thereafter. It's no secret that demand for legal services is flat, competition is stiff, and the ability to differentiate is still seemingly elusive. However, relatively recently, my colleagues and I began hearing a consistent message from law firm leadership. They told us that they need to “do something different” as they seek ways to survive and thrive in the ultra-competitive legal industry.
Expense management certainly continues today, but cost-cutting is only half of the equation. Growing top-line revenue to help the firm improve profitability and spur sustainable growth is the primary focus of many firms today. The sentiment about doing something different is growing louder with every passing “flat quarter,” and addressing this issue is quickly finding its way to the top of the priority list.
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