Yesterday on Twitter, a query was made as to whether there were any truly new law firm business models. A highly regarded legal consultant identified Valorem, Bartlit Beck, Traverse Legal and Shepherd Law Group as examples. There ensued a debate whether any of these firms other than Shepherd Law Group were different. According to the protagonist in this dialog, if a firm used time sheets, it was not “different.”
At one point, I was laughing so hard that I started to cry. The idea that your business model is different and acceptable if you eschew timesheets but not different or acceptable if you use timesheets is lawyer-centric (or consultant-centric or accountant-centric) in the extreme. The debate on Twitter (perhaps owing to the 140 character limit) seemed to devolve into a “my way is better than your way” argument where there was precious little recognition of the business realities driving the choice of whether timesheets are used or not.
Let me begin by acknowledging that my preference is for a world without time sheets. If I am ever a buyer of legal services, I won’t have my lawyers use them. But right now, I live in a world where I serve clients. Our clients are sophisticated buyers of legal services. If they tell me they want to see time records with a bill, even if the bill is not hourly based, I provide them. For many clients making the transition to non-hourly billing, the hourly records are important as they gauge value. It would be nice if they all believed as Ron Baker does, but that’s not my world. I suppose I could refuse to take on such clients, but I have mouths at home that clamor for food. I can just hear the voices out there telling me I am a coward for not abandoning time sheets completely in the hope that clients will come as they have to others. With due respect to these voices, I do not see enough clients willing to go that road that I am willing to write-off the chance to represent 99% of corporate America. If I had a practice dealing with smaller matters or individuals or a more local clientele, maybe things might be different.
Beyond this point, both the expectation that courts have that any fee requiring court approval have time records to support it and the need to internally know who is available make time records important or useful. One person on Twitter wrote “since time records are an inherently inaccurate tool, how can they be used in court?” I have not debated the wisdom of this eons-old practice with any judges. But since I expect to be asking several to approve fees, I don’t want to run the risk that I come across a judge who chooses to follow lines of authority basing approval of fees on time records. The visual of spitting into the wind comes to mind.
I’ve never told another lawyer that he or she should or should not use time records. I couldn’t care less. I have spoken and written at length about aligning economic interests with clients. I know that this has to be done in a competitive marketplace and even those who don’t use time sheets compete on price, at least to a degree. If they are more expensive than a comparable lawyer, the odds are many clients will chose the lower priced alternative. So if the lawyer factors into his or her pricing what a competitor is likely to charge, they have created a fee based, to some degree, on time.
If the debate is whether use of time sheets is relevant evidence of employing a different business model, I will pass on that debate as useless and a waste of, dare I say it, time. If the discussion is about how lawyers are aligning their economic interests with their clients, how workflow is different, how people are engaging in practices that deliver better results by eschewing use of baby lawyers, how lawyers are creating “wow” customer experiences and whether a model that is based on those things is different, I’ll spend some time on that discussion because its about what the customer gets out of the relationship. But even these kinds of discussions are like talking about which team is going to win the Superbowl before the game is played. The conversation might be fun, but it really doesn’t matter all that much, does it? The game still has to be played.
Instead of criticizing those who dare to change for not changing enough, it seems more prudent to be applauding anyone who tries something that’s even a little bit different. A bunch of little changes will eventually beget big change. A larger scale change will benefit our clients, and that, to me, should be the focus of discussions.