The Action Hots Up--Irwin Mitchell Declares ABS

(thanks to Paul Mannix)

Now the Alternative Business Structure action is hotting up thanks to Irwin Mitchell's declaration that it will incorporate and use its investment to take on the many mid-tier law firms wondering what to do come October 2011.

If anyone is in the dark, this year the first ABS come into existence under the provisions of the Legal Services Act 2007.

The legal profession is being so complacent and ostrich-like about ABS that Irwin Mitchell's action is a necessary corrective. It's clear from a basic analysis of the law firms in the UK that the mid-tier firms are essentially fungible. They all say they do the best work for their clients, they all hire the best graduates, they all take the finest care of their clients, and they all learn about their clients' business. It's impossible to distinguish one from the other. And most of what they say is "iffy" at best. (I'm being very mild putting it this way.)

If these firms don't think strategically about their futures, they're lost. Irwin Mitchell has moved from being a personal injury firm into a law firm that will be able to offer a range of custom made services with a strong commoditized services wing that will offer white-label services to low cost providers. It is this last part where the investment will earn its return.

The comments on The Lawyer article are of interest. They represent the traditional views which are no longer consonant with the way the legal services market is moving. I'm surprised by the blinkered views especially as this is not new. Irwin Mitchell is not unlike Australia's Slater and Gordon, a personal injury firm that floated in 2008.

Let me reflect on three aspects of the Slater and Gordon flotation that are relevant to the UK. First, the firm was reconstituted with a transparent and meritocratic career structure, something which few UK law firms have. Second, the firm grew by merger and acquisition and its success can be measured by its stock performance. Participants in the firm now possess tradeable equity. Third, the system of regulation predicated on the back of the Australian incorporated law firm legislation, ie. outcomes focussed regulation, appears to be working. See Christine Parker's paper. The UK's version will be starting soon.

Now let's see if other law firms can shake off the dust.

The Action Hots Up--Irwin Mitchell Declares ABS

74th Session of the Philosophical Foundations of Law and Finance

Dear all,

For the 74th session of the Philosophical Foundations of Law and Finance (Friday, April 15 · 6:00pm - 8:00pm, Room 5.16, 309 Regent street, London, United Kingdom) we will continue to read Homer’s Iliad [available at http://digital.library.northwestern.edu/homer/html/application.html] and apply a rather interesting theory by Kevin Dutton who’s written a book entitled, “Flipnosis, The Art of Split-Second Persuasion”(2010). The book is in some way a scientific continuation of unfair arguments catalogue by Aristotle in his Art of Rhetoric.

The idea of flipnosis is that there are certain forms of persuasion that are so instantaneous that they appeared to be hard-wired into our biological system of being. These might be thought of “one-liners” that change our perception of the world, and with it, our immediate relationship to the world such that we act in a way that is completely different to the way in which we would have expected.

If one were to ask how many times per day you are being bombarded with “flipnotic” arguments, ads and purposive persuasion, what would the answer be? The average answer is 30 to 40. But the actual number is closer to 400 times per day. It happens so often that we have become habituated to it.

As part of our close reading of the Iliad, which is a poetic description of battling wits, gods, goddesses, heroes and heroines, we look for instances for flipnosis. Does flipnosis occur in the Iliad? Of course, but where precisely and how, is what we wish to catalogue. We see how it operates to protect the forsaken and change the course of war.

Afterwards, we will submit to the charms of the Galleria at 17 New Cavendish St, Marylebone, W1G 9. 

See you soon,
Joe & Rezi

74th Session of the Philosophical Foundations of Law and Finance

73rd Session of the Philosophical Foundations of Law and Finance

Dear all,

For the 73rd Session of the Philosophical Foundations of Law and Finance, we shall take respite from the awful world of wars-for-oil of Libya, the potential genocide of The Exploding Plutonium Corporation (TEPCO), the bankster-paid political announcement of Obama to run for a second term as President, and the ignoble lies of the US Fed which is paying 83% of the US debt, thereby, increasing systemic risk to an insane level. In this world where authoritarian cover ups and appeals to calm are used to paper over the cracks of hazardous realities, it is time that we re-discover THE WRATH of Achilles, in Homer’s immortal Iliad. It may help us wake up to the veiled wars around us.

Joe’s favourite modern translation into relatively modern English is Richard Lattimore’s (1951). The interlineal (Greek – English) translation using Lattimore’s translation can be found here: http://digital.library.northwestern.edu/homer/html/application.html

We will read Homer’s Iliad this Friday in the usual location, room 516 at the Regent Street campus of the University of Westminster, from 6 to 8pm.

Afterwards, we shall peacefully enjoy the wonderful cuisine of the Persian restaurant Galleria at 17 New Cavendish St, Marylebone, W1G 9, about £15 if you can resist to wine… “Inflaming wine, pernicious to mankind, Unnerves the limbs, and dulls the noble mind.” (The Iliad, Book 6).

Best wishes!
Joe & Laura

73rd Session of the Philosophical Foundations of Law and Finance

New Structures for Law Firms?

Julie Adams has written an article in Accountancy Age speculating on new structures for professional partnerships. She makes it clear that younger partners do not see the traditional model enduring.

Conventional partnerships will change into more "employee-owned" forms along the lines of the John Lewis department store model. See this discussion for how it works. This would enable employees and partners to participate in ownership but with greater ease and flexibility of movement. Their equity would be tradeable.

Of course there are other models such as the Goldman Sachs quasi-partner model which isn't a partnership but behaves like one. Stephen Harper has written about this.

Both John Lewis and Goldman have very high leverage ratios (if John Lewis can be said to have one). While some people may spend their entire careers with the firm, average tenure is short. In the case of Goldman burnout occurs after 7 years. Or as the Jesuits would say, "Give me the man and I'll show you the corpse."

Moreover, the advent of ABS there will be increased competition for senior positions as more professionals participate. The world will be more multi- and inter-disciplinary.

Technology and client demand, according to Adams, will lead to a greater segmentation of services and their delivery. Commoditization and standardization and new forms of service delivery are the key here. It's worth reading Jordan Furlong's paper "The Talent Portfolio: New Options for Where, How and By Whom Your Work Gets Done."

The part I like in Adams' article is her depiction of the changes wrought by Generation Y who use work and technology differently from earlier generations. We haven't got to grips with the potential of the scale of change here yet. In part I suspect people discount Gen Y as a fad, even chimerical. It's not and we won't be able to impose our values on it. See, for example, the shillingmesoftly blog. So, as a necessity, change will happen.

New Structures for Law Firms?

Government Abandons Legal Services Act--Tesco Law Dead!

In a shock U-turn the government has decided to abandon the most controversial parts of the Legal Services Act. Alternative Business Structures will not be introduced in October, if at all.

A spokesman from the Ministry of Justice said, "We have listened carefully to the concerns of the small firms and decided their preservation must come before innovation. Consumers are best served by traditional means. This is the essence of conservatism."

RIP Tesco Law.....

Government Abandons Legal Services Act--Tesco Law Dead!