Virtual Law Firms: The Next Iteration

Volume 39 Number 4

By

About the Author

Chad E. Burton is the founding attorney and principal of Burton Law, a virtual law firm with lawyers in Ohio, North Carolina, and Washington, D.C. Chad serves as outside general counsel for privately held businesses.

Law Practice Magazine | July/August 2013 | The Big Ideas Issue

The future of virtual law firms. It seems a little early in the game for this discussion, doesn’t it? It’s not. For many, the label virtual may have a mysterious feel. For others, it is simply practicing law. It is not mystical or magical. Real clients, with real needs, are served, ranging from large corporate clients to individuals. These firms provide sophisticated services.

The concept of virtual law practice originated in the solo world with lawyers serving clients through a website and an online client portal. Providing unbundled legal services to a segment of the population that would not necessarily want to meet face-to-face with a lawyer (or afford traditional services) is a good thing. In fact, in early 2013, the ABA approved a resolution supporting the delivery of unbundled legal services.

The virtual arena expanded with multilawyer law firms. Take your traditional brick-and-mortar office, blow the walls off of it, allow the lawyers to work where they are most productive, substitute on-site staff with virtual assistants and paralegals, replace in-house servers with cloud-based solutions and, voilà, you have a virtual law firm. (Okay, it is not quite that easy, but you get the idea.)

More and more lawyers are heading down these paths. This is a positive development and is one aspect that demonstrates how our profession is evolving.

However, the proverbial pat on the back for innovation and recognizing there is more to technology than fax machines and email is not enough. We need to understand where virtual law firms are heading and why this matters. (The second issue directs the first.)

Here is the punch line: The future of virtual law practice is in multilawyer, multijurisdictional law firms providing both full and unbundled legal services.

Now, how do we get there? This article examines

  • the driving factors behind the viability of virtual law firms,
  • putting together a team for this next wave of virtual  firms, and
  • ideas for the functionality of this concept.

WHY VIRTUAL LAW FIRMS?

Simply put, your clients. It should be no mystery to any lawyer at this point that the legal marketplace has changed. Client expectations have changed and will continue to evolve. People much smarter than this author—Richard Susskind, Jordan Furlong and Stephanie Kimbro, to name just a few—have been explaining the future of the profession for quite some time and are quoted elsewhere in this magazine. They all discuss imminent changes that need to occur or are already occurring on a large-scale basis. Consumers are driving most of the change, and those lawyers who ignore what is happening risk irrelevance.

Lawyers must be able to provide more services for less cost to our clients, regardless of the type or size of the client or practice area. In a global marketplace, firms should be able to provide services to clients in different jurisdictions. This means that law firms have to engage in changes that are more than cutting hourly rates or considering alternative fee structures in an attempt to keep their clients with them. This will reduce the top side of the revenue stream but does not address the expense side.

This is where emerging business models, such as virtual law firms, can help through structuring effective work environments that have lower overhead. Think about these questions:

  • Do your clients care where you produce the actual work product for them?
  • Do your clients care whether the lawyers and staff for a firm operate under one roof?
  • Do your clients care whether your meeting space is rented from a shared office model such as Regus?
  • Do your clients care if your administrative help is outsourced to a virtual assistant or receptionist service?
  • Or are your clients looking for timely, quality work regardless of where it is produced?
  • Are your clients looking for solutions that do not break the bank?
  • Are your clients willing to engage in innovative delivery models that are more convenient for them?

Answers to these questions allow the leadership in a virtual law firm to be more creative. Really looking at what clients care about can be an agent of change. And, if you do not know the answers to these questions, ask your clients. Honestly assessing the answers to those questions can be enlightening as to how a law firm should operate.

WHAT ABOUT YOUR TEAM?

To pull off a virtual law firm, the overall team is critical. Three primary components make up this team:

  1. lawyers,
  2. administrative support and
  3. technology partners.

Starting with the lawyers, just because someone is really smart and substantively proficient in a practice area does not mean he or she is cut out for a virtual or nontraditional work environment. When working in a distributed manner, there is an element of entrepreneurialism that is necessary in each lawyer. This is true even if the lawyers are not developing external business and fall into the employee category.

Building a team of lawyers remotely is more of a challenge and takes extra effort because the members do not see each other on a regular basis. They cannot pop into each other’s offices on a whim. As such, the drive of the individual lawyers to build relationships with each other and to establish trust in their work and caring of clients is essential. This also means that the firm leadership must create a culture of collaboration through in-person or video connections and other technology platforms. The ability to adapt to new technology is obviously an important characteristic of any lawyer on this team.

Administratively, a virtual firm needs support regardless of the size. Even solos should have administrative support to effectively delegate work so they can focus on client service and the substantive work product. Depending upon the size of the firm, internal support through an operations manager may make sense. Otherwise, alternative sourcing is a great option for virtual models. Virtual assistants and virtual receptionists provide services to lawyers on a contract basis. In this way, the cost of outsourcing ebbs and flows with the firm’s workflow.

On the technology front, the choice of platforms is key to a cohesive virtual practice. This is true for solos providing services online and multilawyer firms operating in a distributed manner. Gone are the days when major tech platform providers are simply considered vendors. These providers should be considered partners in your client service efforts (not in the legal sense, as I am sure you lawyers were thinking). Working closely with these companies, lawyers can learn new and innovative ways to deliver services, and the providers also can learn from how lawyers have created innovative service models.

THE FUTURE OF VIRTUAL LAW FIRMS

Assuming the understanding of clients’ needs for change and the ideas percolating about forming a virtual team, why would virtual law firms move to be multijurisdictional and provide full and unbundled services? Because it makes sense and is a logical next step.

Regarding multijurisdictional efforts, if a firm represents corporate clients (and individuals, for that matter), there is a growing need for legal work in different states. This is not new, but with the Internet, it is naturally easier to connect with others around the country—and the world—to do business. This leads to legal needs both handled proactively and on the dispute resolution side. A wide-ranging network of lawyers under one umbrella can provide a full range of national legal services that covers multiple jurisdictions.

Adding strategic members of a team around the country is much easier when operating outside a traditional brick-and-mortar setting. This approach also allows for selecting subject matter experts to join the ranks without relocating to the firm’s headquarters. One can imagine that this would be of interest to clients looking for sophisticated services.

Further, many clients can benefit from both full and unbundled services. Whether lawyers want to admit it, much of the “legal” work that is produced does not have to be done by a licensed attorney. Many clients will continue needing customized work, but that which can be automated for the same clients should be automated. This goes back to clients expecting to receive more by paying less.

This is where a firm can use online client portals to serve their clients in creative ways. Some clients may remain simply full service or only online and unbundled, but many could benefit from both approaches. For example, a full-service firm could represent a company in a complex litigation dispute while providing them with unbundled and automatically generated nondisclosure agreements for a low cost.

The various iterations of hybrid, combined legal services under a multijurisdictional approach abound. This is the type of approach clients should expect—not only creative lawyering on the substantive end of the spectrum but also on how lawyers deliver their services.

Engaging in a virtual law firm model opens the door for many possibilities with fluid options that can fit both the goals of a firm and the needs of its clients.

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