Indian law firms are striving to attain best practice management, marketing and strategic planning. Are senior partners best-equipped to accomplish this task or should it be entrusted to business managers and specialist consultants?
Twenty years ago, it might have been impossible to find an Indian law firm with a name that didn’t showcase its legal pedigree. Today, these firms continue to flourish but have to compete with a new breed of lawyers who are bright, brave and bursting with ambition in spite of being the first lawyers in their families.
Typical of this new breed is Gunjan Dhoreliya. “I don’t come from a family of lawyers,” says this founder and managing partner of six-year-old intellectual property boutique Zeus IP. “I wanted a name that was generic and that everybody at the firm could relate to.” For Dhoreliya the Greek god Zeus, an image of which she has tattooed on her back, was an obvious choice. “Honestly speaking I didn’t have the money to go to a designer, so I had soft copies of the tattoo and I said, let this be.”
With such a diverse mix of law firms attempting to make their mark on the legal landscape, many are looking for unique ways to position themselves. As they do so, the long-entrenched management techniques of traditional firms are coming under threat, none more so than the tendency for senior lawyers to retain complete control of all business, strategy and marketing decisions.
“They might be excellent lawyers, but they’re bad speakers, they’re bad at networking, they’re bad managers,” laments Juhi Garg, India partner at the international legal consultancy Edge International. “These are things you understand only when you get into their world.”
Aware of the threat, a growing number of Indian law firms have been hiring marketing specialists and turning to branding gurus, management moguls and strategy consultants for specialist advice on everything from how to win new clients to improving compensation packages and exploring alternative billing structures.
Where law firms are lacking
A big stumbling block for law firms in India is the reluctance of partners to delegate responsibility. As a result, confusion reigns in many small and mid-sized firms as partners juggle marketing and corporate communications roles alongside their own demanding legal work.
At the handful of firms where marketing specialists do exist, partners are still largely involved in business development, liaising with the media and executing strategy. “Our communications consultant’s role is to assist the firm, to maintain databases, issue press releases, etc.,” says Akshay Chudasama, a partner and head of business development at J Sagar Associates. “Decision making lies with the partners.”
This is in stark contrast to what a marketing manager at an international firm would do. Not only are these professionals normally well-acquainted with the intricacies of the deals that their firms have worked on, but they also control budgets for advertising, sponsorship and branding.
Indian lawyers, on the other hand, appear apprehensive at the thought of their marketing managers talking to the media by themselves. Several attempts by India Business Law Journal to discuss marketing practices with marketing managers at Indian law firms resulted in hurried email exchanges, following which an interview was offered with a relevant partner (at which the marketing manager would not be present).
While restrictions on advertising decreed by the Bar Council of India could be largely to blame for some of the antiquated marketing practices, consultants say that part of the problem is the unavailability of qualified marketers who also understand the business of running law firms. Many agree that marketing and management credentials hold little value if individuals fail to understand how lawyers work.
“Lawyers are a very different breed, they function differently, they have a different mindset, their whole day is very different,” says Garg. “If you want to go and get into a particular practice area, you need to know what that practice area looks like, who are the key players, which law firms are already in that area.”
In addition to marketing, a number of other processes are integral to the efficient functioning of a law firm. These include efficient billing systems, which are lacking in many law firms as lawyers struggle with time sheets and other tools used to account for their time. Furthermore, senior lawyers are often unaccustomed to partner reward systems, client account programmes, appraisals or even performance-linked compensation.
“The legal industry in India is still very cottage,” says Bithika Anand, the founder of Legal League Consulting, which works with law firms to improve their business processes. “A lot of firms are sole proprietors or family-run, so they have their own nuances which we have to deal with before we bring in processes.”
Several consultants say that while Indian law firms undoubtedly have talent, they lack the fundamental business plans and the long-term vision needed to realize their ambitious growth targets. “There is no blueprint,” says Anand. “They are all very day-to-day; they’re all running after a transaction. They do an extremely good job of it. But that’s not enough.”
Big dreams, messy blueprints
All of this may be changing as both small startups and large established firms start paying greater attention to their strategy, management and marketing. In 2008, when Chennai-based Global Business Solutions rebranded itself as Altacit Global, its CEO, Sudhir Ravindran, said, “Of late, lawyers [have been] allowed to advertise in a small way in India, so we thought it was the right moment to go forward with the name change.” Explaining the process of finding a new name he said, “It was a name that was selected carefully … ‘Alta’ is Spanish for elevated, and ‘acit’ in Sanskrit is someone who complements and consults.”
Other rebranding exercises have been less happy. Mumbai-based law firm Lex Nexus changed its name to Brus Chambers in 2009 following a legal challenge from LexisNexis, an international legal publisher.
But many law firms are looking beyond just changing their names. “The shift we are seeing is that now law firms want external consultants to help them devise a strategy complying with their short and long-term strategies,” says Garg. “So for example, if a firm wants to grow its domestic practice, enter the Mumbai market or the financial services market, then what is the plan, what is the strategy you need to have and how do you execute it? This is something which keeps managing partners awake at night.”
For established firms, the challenges may be very different. Pointing to the changing dynamics of the market and the demand for alternative fee arrangements, Silvia Coulter, managing director for client development at US law firm consultancy Hildebrandt Baker Robbins, explains: “Mature firms are finding they need to reinvent themselves. Many have to be more strategic and entrepreneurial to respond to clients on a number of levels”.
Law firm makeovers
Indian law firms are attempting this to varying degrees. “The biggest user of consultants in the market is probably Amarchand, which has got the money, the appetite and the ambition,” says Reena SenGupta, managing director of RSG Consulting in London.
Indeed almost a decade ago, Amarchand Mangaldas gave itself a makeover with a fresh set of colours, a new logo and a smart new profile. “The firm’s target was to make it public to the fraternity, in terms of India, that they were the leaders,” reflects Saikat Roy Chowdhury, who worked as a corporate communications manager at the firm between 2003 and 2005. “The branding they had until then was what had been developed in the 1920s or 1930s.”
Roy Chowdhury praises the firm for its strong internal communications strategy. “The firm looked at itself as a corporate entity, not a law firm … Quite a bit of freedom was given. The good thing was if you could explain your ideas well, the managing partners were very receptive.”
Anand of Legal League Consulting is a former chief operating officer of Amarchand Mangaldas and was a key figure in spearheading the metamorphosis of its brand. She has since provided consultancy services to a number of Indian law firms, including ALMT Legal, ARA Law, Bharucha & Partners, DSK Legal, Dua Associates, IndusLaw, J Sagar Associates, Lall & Sethi, Link Legal, MV Kini & Co, Nishith Desai Associates, Phoenix Legal, Rajani & Associates and Vaish Associates.
“[Firms] have realized that just to be a good lawyer is not good enough,” says Anand. “They need to ‘brand’ … Outside perception is very important. It is important for them to encourage knowledge management, where people write more articles, speak at seminars – that is how your knowledge is projected.”
However, other consultants disagree. “Getting noticed in the press, or getting a few bites in a magazine is important, but it’s a very small part of the brand value that you can create for yourself,” says Garg.
Ritvik Lukose, a founder at legal consultancy Rainmaker, says his company steers clear of pure consulting services and instead provides firms with intensive research reports. “People come to us for compensation reports, data and competitor information,” says Lukose, who is a former associate at Amarchand Mangaldas. “They aren’t looking at us to make decisions for them; they’re looking at us to help them make better decisions.”
Lukose believes law firms seek guidance in four areas: compensation, including human resource structures, partnership structures and fee arrangements; competitor analysis, including billing rates and deal flow; market information, including potential clients and legal spending; and internal aspects such as the implementation of a new process, growth strategy or law firm mergers. Rainmaker’s list of clients includes Amarchand Mangaldas, AZB & Partners, J Sagar Associates, Trilegal, Infosys, ICICI Bank, Star TV and Disney.
London-based RSG Consulting adopts a similar approach. “We’re kind of like anthropologists for lawyers,” says SenGupta. “We study them and analyse the business of law and provide advice based on that.”
SenGupta and her team began their investigation of the Indian legal market three years ago after their clients expressed an interest. “We set out to empirically and objectively investigate the Indian legal market,” she says. “It’s a really fascinating market … Firms have traditionally been family-dominated or dominated by a sole proprietor. The market is a bit schizophrenic because you have a younger generation of Indian lawyers with a very different mindset.”
Legal speed dating
A key trend that has emerged in recent years is the tendency for international law firms to seek alliances with their Indian counterparts. But it is not just international firms that are playing the dating game. Several Indian firms have also attempted to achieve growth through domestic mergers and alliances. Last year saw J Sagar Associates merge with Bangalore-based M&C Partners and AZB & Partners merge with Anup S Shah Law Firm, which is also based in Bangalore.
Other, less successful, tie-ups were attempted. Paras Kuhad & Associates, for example, merged with Hemant Sahai Associates on 1 October 2009. The union was dissolved just two months later as a result of what one Hemant Sahai partner described as “certain client conflicts that could not be resolved”.
Some observers believe that Indian firms may be rushing to jump on the M&A bandwagon. In mature markets like the US and the UK merger and acquisition exercises can take years. “If you engage in meaningful discussion with a firm it could take nine months to two years, but many firms spend five, six, eight years looking for the right partner before they’re ever engaged,” says Peter Zeughauser, whose company, Zeughauser Group, advised on the Hogan Lovells merger.
Costs and benefits
Whether law firms are thinking of mergers, management overhauls or marketing and rebranding exercises, they may profit from a little hand-holding. The initial cost might be unnerving, especially for smaller firms, but getting the right strategic advice can make the difference between success and failure.
Hildebrandt Baker Robbins offers help for clients looking to tap the Indian market from both inside and out. Speaking about the expansion of domestic law firms, Coulter says, “Firms will think it’s a good idea to open an office, but they haven’t done any research to determine what the opportunities are ahead of time.” The market research needed to make an informed decision, according to Coulter, is available from around US$15,000.
Consultants generally base their charges on the size of a law firm, the type of consultancy required and the investment the firm is willing to make.
On the business development side, which could involve consultants working extensively with a group of lawyers – it could be 10 lawyers in a big programme – the cost would be approximately US$90,000. “Something like that runs generally over a period of a year, so that we’re really helping them grow their book of business and their referral and client relationships,” says Coulter.
More in-depth consultancy services require larger investments. “If a 20-partner firm is looking to revamp its remuneration structures, you could be looking at anything up to US$200,000-300,000,” says SenGupta. However, “if you’re looking at a client development programme for a small firm, we could put together a very simple one that wouldn’t necessarily cost more than US$5,000-10,000,” she adds.
Intensive research reports, such as those produced by Rainmaker, are cheaper than bespoke consultancy services. “Our reports would range from Rs10,000 [US$220] to Rs50,000,” says Lukose at Rainmaker. “For other services such as internship management, we’d work on a fixed fee rate.”
Consultancies may also work for law firms on a retainer basis, as long as conflicts of interests don’t arise. “If a firm wants to grow an IP practice or develop a client base among pharmaceuticals, we could do that for one firm, and then develop a client base in telecoms for another firm – so there’s no conflict because they’re totally different industry sectors,” explains SenGupta. “If we were to handle business development and PR for a law firm and give them two days a week of our time for the next year, then that would obviously be quite pricey because that’s an exclusive function, and not one we have taken on yet.”
Legal consultancies may claim to have all the answers, but many Indian lawyers still need some convincing. “A lot of persuasion is needed” exclaims Anand.
“Frankly the barriers to entry in south Asia are too great to put on anybody’s screen,” says Zeughauser, who adds that working in markets like Japan and China is much easier.
Some have had it easier than others. Rainmaker is the brainchild of four ex-lawyers: Lukose; Nikhil Chandra, a former senior associate at AZB & Partners; Bhavin Patel, a former associate at DSK Legal; and Sachin Malhan, the former founder and head of Law School Tutorials. “When we started research, it was very easy because we had people from the industry who gave us their backing,” says Lukose.
As legal consultancy is a new concept in India, the industry is perceived as an attractive alternative for lawyers wanting to escape the confines of a law firm. However, SenGupta is quick to set the record straight. “In the UK market, lots of ex-lawyers have set themselves up as coaches and mentors and business development people and they’ve struggled, it’s much harder than they expected,” she says. “The only consultants that tend to do well worldwide are those that have a few grey hairs, who’ve got experience either within firms or without.”
Egos, availability and consensus
Most consultants agree that building trust and providing confidentiality are of paramount importance. But once that is done, the next challenge is to schedule the project into the partner’s busy lives. “Every firm has a leadership group and getting those people together typically has to be scheduled far in advance as they’ll be busy either with client service or firm management,” says Zeughauser.
Once the key leadership team is together, obtaining general consensus on direction and outcome can be tough. “Having everyone agree on a direction is difficult with the managing partner trying to lead the effort,” says Coulter, “because it’s a democratic environment at law firms”.
But once this hurdle is cleared and the consultant delivers, most firms have been pleased with their services. “We’ve worked with Rainmaker on training and HR and our experience has been quite positive,” remarks Chudasama. “But ultimately the solutions lie within us.”