In a recent Platforum9 Session, Rory O’Keeffe, a solicitor with extensive experience in both small and large law firms, shared valuable insights on why small law firms need to adapt quickly to survive in the rapidly changing legal landscape. O’Keeffe’s diverse career, spanning from a small rural practice to corporate M&A and in-house roles, provides a unique perspective on the challenges and opportunities facing small law firms today.
The Changing Legal Landscape
O’Keeffe highlighted several key factors driving change in the legal industry:
- Technology Advancements: The rise of AI and other technologies is changing how legal services are delivered.
- Client Expectations: Clients are demanding faster, more cost-effective services.
- Competition from Non-Lawyers: In some areas, like property law and will writing, non-lawyer specialists are entering the market.
- Automation of Basic Services: Simple legal tasks are increasingly being automated or handled by AI.
Challenges for Small Law Firms
Small law firms face several unique challenges in this evolving landscape:
- Limited Resources: Smaller firms often lack the time and money to invest in new technologies or business model revisions.
- Technology Adoption: Many small firms are still paper-based and struggle with digitisation.
- Choosing the Right Tools: With numerous legal tech options available, it’s difficult to make informed decisions about which tools to adopt.
- Competitive Pressure: Both from larger firms and new entrants to the legal market.
Strategies for Survival
O’Keeffe offered several strategies for small law firms to adapt and thrive:
- Become Niche Experts: “What I would say is they need to become niche experts, being a generalist won’t help you much longer.”
- Embrace Technology: While acknowledging the challenges, O’Keeffe stressed the importance of adopting new technologies. He shared his own experience: “I was saying I need to use all these tools in order to compete, but also it’s not competing on prices, but also competing on the value proposition you’re going to give to your clients.”
- Reassess Business Models: “Out of my legal services, is there anything there I can commoditise without jeopardising the full value in R&D? Is there a first market advantage that I can have in relation to that business model that I’m going to put together?”
- Leverage Agility: O’Keeffe noted that small firms can be more agile in implementing changes: “With a small firm, they’re more agile because they just have to say we need to change.”
- Focus on Client Relationships: Small firms often have an advantage in building deep client relationships. O’Keeffe stated, “For, if you’re in a small firm, you get to know your clients a lot better because you’re in front of them. You’re talking to them regularly.”
- Adapt to New Work Models: Recognise the importance of hybrid working arrangements to attract and retain talent.
The Role of AI and Technology
O’Keeffe emphasised that while AI and technology are changing the legal landscape, they are not replacing lawyers entirely. He noted, “What AI can’t do is that they can’t give reason or insight into the situation. Because as we all know, every matter, every case is unique to its circumstances.”
He stressed the importance of lawyers focusing on applying the law to specific circumstances, which still requires human insight and judgement.
The Future of Small Law Firms
Despite the challenges, O’Keeffe sees a future for small law firms that can adapt. He emphasised the importance of change, stating, “The mantra for lawyers is there are concerns… But at the same time, the mantra is change or be changed.”
However, he also acknowledged the need for balance, especially in smaller markets where being too niche might not be viable. The key is to find the right balance between specialisation and meeting the diverse needs of the local market.
Conclusion
The legal industry is undergoing significant changes, and small law firms must adapt quickly to survive. By embracing technology, focusing on niche expertise, leveraging their agility, and maintaining strong client relationships, small firms can position themselves to thrive in this new landscape. As O’Keeffe aptly put it, the choice for small law firms is clear: “change or be changed.”
