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Future of the Practice of Law. Presented by Charles F. Robinson March 18, 2003. www.ChalieRobinsonFuturist.com www.Charlie-Robinson.com. Presentation Materials. http://CharlieRobinsonFuturist.com/. Must Develop a Sense of Urgency. Tom Peters predicts.

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future of the practice of law

Future of the Practice of Law

Presented by

Charles F. Robinson

March 18, 2003

www.ChalieRobinsonFuturist.com

www.Charlie-Robinson.com

presentation materials
Presentation Materials

http://CharlieRobinsonFuturist.com/

tom peters predicts
Tom Peters predicts
  • Ninety per cent white-collar jobs will disappear in the next ten years.
  • What color collars do lawyers wear?
  • Is there an exception for lawyers?
slide6
Tom Peters

“We are in the midst of the most profound change since the beginning of the Industrial Revolution, over two centuries ago . . . Perhaps the most profound change since the Chinese more or less invented hierarchy thousands of years ago.”

  • Circle of Innovation, 1997
dee hock
Dee Hock

“We are at that very point in time when a 400 year-old age is dying and another is struggling to be born- a shifting of culture, science, society, and institutions enormously greater than the world has ever experienced.

slide8
Too many are struggling to embrace the disciplines of the industrial age in a new economic/professional order.
our guild legal profession operated as a guild in us for many years
Our GuildLegal Profession Operated as a guild in US for many years-
  • Monopoly on legal services-
  • We could define legal services as we wanted
  • Death of the Guilds- Professions, States, and the Advance of Capitalism 1930 To the Present

Elliott A. Krause 1996

guild characteristics
Guild Characteristics
  • Bar determined
    • Who could be a member
    • Standards for service quality
    • Pricing (minimum fee schedules)
    • Quantity of service to be performed
guild status decline
Guild Status Decline
  • Goldfarb 1975
    • End of pricing control
  • Bates 1977
    • Advertising allows for competition
  • Guild status gone since 1975 but many in denial in 2003
nh bar outreach 2000
NH BAR OUTREACH 2000

Can the legal profession

survive

the “dot.comet”?

slide15

Results of a poll conducted by Franklin Pierce Law Center graduates of their clients:

  • Lawyers charge excessively and add significantly to the cost of a legal need.
  • Lawyers add significantly to the time it takes to satisfy a legal need.
  • Lawyers complicate already-complicated problems.
law school client survey cont
Law School Client Survey cont
  • Lawyers don't take time to learn enough about a client's legal need, and then do not adequately address the need. When they address the need, they are paternalistic and arrogant.
  • Lawyers don't know when to step aside.
  • Lawyers' expertise in litigation and advocacy impedes problem solving.
chief justice major harding 2 5 2000
Chief Justice Major Harding 2/5/2000
  • Dispute resolution as we know it may be a dinosaur
  • Must look at reforming the jury system
  • The big issue before the court system is relevance
slide18
Too many are struggling to embrace the disciplines of the industrial age in a new economic/professional order.
less than two years ago major insurance company ceo said
Less than two years ago, Major Insurance Company CEO said,

“Insurance is too complex. I think people will always need agents.”

“What Planet was that guy living on?” Gary Hamel

quebec bar study
Quebec Bar Study

Three Scenarios for the Future of the Profession

future scenario 1 status quo
Ignore the changes in the world and do business as usual

Medical profession view 10 years ago

Abdicated right to choose their future

Mural graphic dyslexia

Try to compete ethically in spite of Rules 5.7, 5.4, 1.7, 1.8

Watch our market disappear for Law-Related Services

Courtroom only exclusive domain for lawyers

Future Scenario 1- Status Quo
future scenario 2 albania
Manage supply of services

Limit new admittees to Bar

Aggressively pursue UPL

Fight MDP/Ancillary Business

Carefully and extensively define law practice

Banish all visionaries

Bright line test for Law Practice

Maginot?

Future Scenario 2- Albania
future scenario 3 singapore
Future Scenario 3- Singapore
  • Become change-oriented
  • Proactive attitude
  • Embrace technology
  • New pricing for services
  • Determine market needs
wired magazine january 1998
Wired Magazine (January, 1998)

Guardians of the old order are trying their best to hold back change and preserve their power.

why do great enterprises fail
Why Do Great Enterprises Fail?
  • Inability to Escape the Past
  • Inability to Create the Future

Hamel and Prahalad, Competing for the Future

slide28
“What Are the Forces Already at Work in Our Profession That Have the Potential to Profoundly Transform Our Profession’s Structure?”
  • Each Force a “Discontinuity”
  • Examine Implications for Each Discontinuous Force
current forces impacting the profession
Nonlawyer competition

Diminished perceived value in attorney services

Technology displacement

Lawyer supply exceeds demand

Discontinuity- Precedent has no value

Disintermediation- Out with the middle person

Current Forces Impacting the Profession
areas of practice
Family Law

>70% Pro Se

Rules of Civil Procedure gone

Real Estate

Realtors

Internet

Tax and Estate Planning

Wills on-line

IRS electronic tax filing

Century Business/American Express

House Counsel

Trade Association legal advice

PI Defense

Insurance companies

Litigation

Sport for the wealthy

Contingent Contingent fees

Areas of Practice
repeal estate tax
Repeal Estate Tax
  • Jonathon Blattmachr says good news/bad news
  • Good news- Fresh start basis
    • Full employment for estate planners
  • Bad News- Time will change basis problem
    • Canada Experience over 29 years
    • 90% less work
technology
Technology
  • Internet Available to Everyone
    • Wills, Tax Return Prep On-line
  • Like Printing Press to Church/Temple
  • Literacy Brings New Relationships
the future of law facing the challenges of information technology

Commodity

Traditional

Latent

The Future of Law: Facing the Challenges of Information Technology

Richard Susskind

  • Legal Profession Will Change Beyond Recognition
  • Three Types of Legal Service
    • Traditional
    • Commoditized
    • Latent
susskind s key questions
Susskind’s Key Questions
  • Likely developments in IT over next 10 years
  • Possibilities for law practice in light of IT changes
  • Future for lawyers and what part is the world wide web likely to play
slide35

Figure 1.1

The Grid

External

Technology

Information

Knowledge

Internal

Richard Susskind 2000

slide36

Figure 1.3

The Legal Grid

Client

client relationship systems

online legal services

Technology

Information

Knowledge

back-office technology

internal knowledge systems

Internal

Richard Susskind 2000

slide37

Figure 1.4

Examples of systems

Client

online financial reporting

status reporting

deal-rooms

document archives

electronic mail

2nd generation web sites

virtual lawyers

online legal guidance systems

expert systems

Technology

Information

Knowledge

document management

practice management

human resource management

marketing databases

hardware

networks

operating systems

know-how databases

template libraries

precedent libraries

Intranet services

Internal

Richard Susskind 2000

C

slide38

Figure 1.5

Business impact

Client

new service opportunities

new business models

turning knowledge into value

new, improved ways of

delivering traditional service

Technology

Information

Knowledge

keeping basic systems running

risk management

providing robust infrastructure

efficiency

productivity

leveraging knowledge

Internal

Richard Susskind 2000

C

why did market leading well managed firms fail
Why Did Market Leading, Well-Managed Firms Fail?
  • Good Management
  • Listening to the customer
  • Invested aggressively in new technology
  • Studied market trends
  • Allocated capital to innovations promising best returns
    • Christensen, The Innovator’s Dilemma
sustaining vs disruptive technologies
Sustaining vs. Disruptive Technologies
  • Sustaining technologies improve performance of established products or services
  • Disruptive technologies result in worse near term performance
    • Precipitate firm failures
    • Valued by new and fringe clients
    • Usually cheaper, simpler, smaller,easier to use
develop a strategic architecture
Develop a Strategic Architecture
  • Which new benefits (functionalities) will we offer clients over next 10 years?
  • What new competencies will we need to create those benefits?
  • How must we reconfigure the client interface to provide most effective client access?
    • Competing for the future
the cobb value curve

Internet

The Cobb Value Curve

Competitive Positioning

HIGH

NUCLEAR

EVENT

PRICE

INSENSITIVE

HIRED FOR

EXPERIENCE

RELATIVE

VALUE

ADDED

BRAND NAME

SERVICES

PRICE

COMMODITY

SENSITIVE

SERVICES

LOW

40%

0%

20%

100%

VOLUME OF WORK AVAILABLE

lawyer s traditional paternalistic relationship to clients
Lawyer's traditional paternalistic relationship to clients
  • Producer-controlled relationship
    • I am the learned one and you should listen to me.
    • Drives relationships
      • Advertising police
      • MDP issues
the big question
The Big Question

Will the Legal Profession Reinvent Itself In Order to Provide Highly Valued Twenty-First Century Services to Twenty-First Century Clients?

our paradigm
Our Paradigm
  • Our most deeply held, unconscious set of assumptions and values.
  • The things we take for granted.
  • That which determines our expectations, frames the questions we ask, and structures our approach to what we do.
slide48
“There is no reason anyone would want a computer in their home.”

Ken OlsonPresident, Chairman and Founder of Digital Equipment Corp., 1977

slide49
“This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us.”

Western Union internal memo, 1876.

slide50
“I’m just glad it’ll be Clark Gable who’s falling on his face and not Gary Cooper.”

Gary Cooper on his decision not to take the leading role in “Gone With the Wind”

slide51
“Everything that can be invented has been invented.”

Charles H. Duell,Commissioner,US Office of Patents, 1899

going back to zero
Going Back to Zero
  • Our old strengths offer little protection against the new world.
  • Learning to forget becomes the ideal talent.
  • Discontinuity the Word of the Hour
the impossibility question
The Impossibility Question
  • Search for new paradigms in our organization.
  • What would be the impact of this impossible task if we were able to do it?
principle 1 joel barker cont
Principle 1Joel Barker cont.

New paradigms show up sooner than they are wanted or needed.

principle 2 joel barker cont
Principle 2Joel Barker cont.

The person who is most likely to shift your paradigms will be an outsider.

principle 3 joel barker cont
Principle 3Joel Barker cont.

You don’t have to be the paradigm shifter to get all the advantages.

principle 4 joel barker cont
Principle 4Joel Barker cont.

Our old paradigms keep us from seeing new paradigms.

the paradigm paradox
The Paradigm Paradox
  • We need our paradigms to make sense of the world, yet because of these we become trapped or constrained.
  • If we want to change the structure and leadership of our organizations, we have to address change at this fundamental paradigmatic level. We have to change the thinking behind our thinking.

Dana Zohar, Rewiring the Corporate Brain

slide60

Alphabet Soup

M

J

P

M

D

P

A

B

P

S

A

What Does It Mean For Your Practice?

slide61

What essential or important legal and nonlegal services would benefit clients if offered by my firm or an ancillary business owned or controlled by my firm?

mdp defined
MDP Defined
  • Entity that provides legal service delivery as one but not all of its services and where lawyers and nonlawyers share ownership and fees.
  • Arrangement by law firm with other professional entities to provide services with sharing of profits
mdp status
MDP Status
  • Florida Committee splits 9-9
  • All transactional sections of Florida Bar pass resolution to allow lawyer controlled MDP
  • Florida BOG votes no 44-1
  • ABA House of Delegates 75-25
  • Since ABA vote several states approve
ancillary business
Ancillary Business
  • Entity separate from law firm providing law-related services
ancillary business aba florida history
Ancillary Business ABA/Florida History
  • 1991 Litigation Section version
  • 1994 Current Version
  • Florida Committee trying to go back to 1991 version
  • AB but no MDP
compare mdp and ab
Compare MDP and AB
  • MDP for all size firms- not just big 5 (4?)
  • AB easier for large firms
    • Separate space
    • Separate entity
    • More management
multijurisdictional practice
Multijurisdictional Practice
  • Florida Rule 4-5.5(a) UPL
    • Lawyer shall not practice in jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction
  • 5.5(b) assist another in UPL
  • Birbrower et. al v. Superior Court of Santa Clara County, 949 P.2d 1 (Cal 1998)
mjp issues
MJP Issues
  • Protection of public and clients- Home state/Host state
    • Or is the rule protectionist for host state lawyers?
  • Host state interests
    • Competence- Model Rule 1.1- measure by
      • Bar exam?
      • Accredited law school graduate?
      • CLE requirements?
host state issues cont
Host State Issues cont
  • Discipline within its borders (Full Faith and Credit)
  • Administration of justice- bar committees local pro bono
  • Client compensation funds
  • Access to counsel of choice
host state issues cont70
Host State Issues cont
  • Discipline within its borders (Full Faith and Credit)
  • Administration of justice- bar committees local pro bono
  • Client compensation funds
  • Access to counsel of choice
borderless world
Borderless World
  • Regional/National reciprocity
  • GATS Treaty
  • Alliance member associated as local counsel
  • National/International firms have lawyers in paralegal capacity in states not admitted
upl problems
UPL Problems
  • What is PL?
  • No harm no foul?
  • Protect public or profession?
  • Protecting anybody?
  • Limiting competition from nonlawyers?
slide73
UPL- A Dog That Won’t HuntGemini Ventures of Tampa Inc. v. Hamilton Engineering 26 Fla L. Weekly 927 (2nd DCA April 2001).

“We, as part of the legal profession, should be ever vigilant to protect the public from those who seek to provide legal services without the requisite training and knowledge. However…

slide74
we must also recognize that there are people with experience and expertise capable of providing valuable service to persons involved in legal proceedings without crossing the line between legitimate consulting and the unauthorized practice of law. We do a disservice to the public if we prevent access to these services.”
aba task force on the model definition of the practice of law
ABA Task Force on the Model Definition of the Practice of Law

Presumed law practice when

  • Giving advice or counsel regarding legal rights and responsibilities
  • Selecting, drafting, or completing legal documents that affect legal rights of person
  • Representing person before adjudicative body, including but not limited to, preparing of documents or conducting discovery, or
  • Negotiating legal rights or responsibilities on behalf of a person
4 exceptions or exclusions
4 Exceptions or Exclusions
  • Practicing law authorized by a limited license to practice
  • Pro Se representation
  • Mediator, arbitrator, conciliator, or facilitator, and
  • Providing services under the supervision of a lawyer in compliance with the rules of professional conduct
happy days are here again
Happy Days Are Here Again!!??

Justice Department and FTC

  • Proposed definition would reduce competition and force consumers to pay higher prices for a smaller range of services
  • Prohibit lay service providers from closing real estate loans
  • Prohibit accountants, investment bankers and insurance adjusters from advising clients about various laws.
hewin pate assistant ag for antitrust
Hewin Pate Assistant AG for Antitrust
  • “Those who would not pay for a lawyer would be forced to do so, and traditionally, lawyers charge more than lay providers for such services. Without competition from nonlawyers, lawyers’ fees are likely to increase.”
  • The proposed definition could prohibit Web sites and software makers from helping consumers draft their own documents.
    • St. Petersburg Times 12/25/02
mary ryan aba committee on delivery of legal services
Mary Ryan, ABA Committee on Delivery of Legal Services
  • “A lawyer is best defined as someone who provides the best services in a free market, not the only services in a protected market.”
why worry about alphabet soup
Why Worry About Alphabet Soup?
  • Transactional lawyers out if consumer wants “one-stop shopping”
  • Ethical interpretations may kill rule 4-5.7
    • See Draft Advisory Opinion 2-8
  • If services law-related fair game for all including out of state lawyers
  • MJP may be great opportunity for Florida Lawyers
slide86
Dakota tribal wisdom says that when you discover you are riding a dead horse, the best strategy is to dismount.

© 2000 Charles F. Robinson

in law firms we often try other strategies with dead horses including the following
In law firms we often try other strategies with dead horses, including the following:

© 2000 Charles F. Robinson

changing riders
Changing riders

© 2000 Charles F. Robinson

saying things like
Saying things like . . .

This is the way we always have ridden this horse!

© 2000 Charles F. Robinson

dead horse
Dead Horse?

What dead horse?

© 2000 Charles F. Robinson

visit our web site
Visit our Web Site

www.Charlie-Robinson.com

www.CharlieRobinsonFuturist.com

Or Email Comments to

Elderlaw@Charlie-Robinson.com

Presentation graphics by Wendy

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