Substantial Number Of Firms Say Pricing Is Key Client Concern, With Nearly 80% Believing That Non-Hourly Billing Is A Permanent Trend.
Altman Weil, in its survey entitled “2018 Law Firms in Transition,” has some interesting statistics showing that law increasingly is a more volatile marketplace than in past years. Conducted in March – April 2018, the surveys obtained responses from managing partners and chairs at 398 U.S. firms with 50 or more lawyers, with 45% of the largest American law firms and 52% of the AmLaw 200 responding to the questions in the survey. The results were for the 2017 year.
Here are the results which we found to be of interest:
- 49% of law firms failed to meet their annual billable hour targets in 2017;
- 51% said their equity partners were not busy enough in 2017;
- 59% reported nonequity partners are underutilized;
- 83% indicated that they have some lawyers who are chronic underperformers;
- 45% said revenue per lawyer rose in each of the last three years, 44% reported that it was mixed, and just over 11% reported flat/declining revenue per lawyer;
- 70% lost business to in-house law departments, 26% lost business to improved/directly competitive technology tools, 16% lost business to alternative legal service providers, and 9% lost work to Big Four accounting firms (with the accounting firms likely providing some international law coordination and e-discovery/process management);
- 65% had partners that “resist most change efforts;” and
- 85% indicated that they are talking with clients about pricing, with 89% believing that non-hourly billing is becoming a permanent trend.