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GLOBAL LAW FIRM NETWORKS: An Introduction to Global Market Leaders

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Global Law Firm Networks:
In Challenging Times, a Clear Path

Ally Law is pleased to again be named a Leading Law Firm Network in Chambers and Partners’ ranking of Global Market Leaders.

We are honored to be included among an impressive group of networks recognised by Chambers, and congratulate them on their fine work.

It is in this spirit of excellence that we offer this analysis of what the global business community can anticipate from legal networks in the coming months and years.

Our Primary Focus: Helping Businesses Move from Uncertainty to Certainty

The past few years have been the most transformative and disruptive in recent memory, delivering public health, economic and other challenges on a massive scale. The ongoing COVID-19 pandemic and fast-moving geopolitical developments continue to have major impacts on the global workforce, cross-border supply chains, international business growth, overseas investment, immigration and more.

More than ever, global law firm networks are well positioned to help their clients weather the current storms, find silver linings in the densest of clouds, and create value for businesses, shareholders and customers alike.

We believe that the following trends will make global law firm networks a more attractive option for businesses and individuals seeking representation at home and abroad:

1. Bigger may be better: it’s all in the details

Law firm mergers in 2021 are on pace to equal or slightly exceed that of 2020. While the total number of mergers is still below that of pre-pandemic levels, it is not excessively so: the 10-year running average (2011–2020) is 44, whereas at the end of Q3 2021, 33 law firm mergers had been completed and a number of others are expected to be finalized by year end.

On a per-attorney basis, the bulk of these combinations involved some of the larger U.S. and international law firms, including the merger of Holland & Knight with Thompson & Knight, as well as the separate mergers of Crowell & Moring and Thompson Coburn with smaller, regional firms.

In some respects, the increased emphasis on larger, financially integrated firms makes sense. Big firms typically offer broad geographic coverage, often in multiple countries or regions, and many mergers involve combinations of firms with complementary skill sets.

However, there are a number of downsides to ever-larger firms, many of which directly affect existing and potential clients. These include higher costs (driven in part by high overhead and a levelling-up of hourly rates across offices and partners), an increase in potential conflicts with other client matters, and slower responsiveness due to a tendency to silo discipline-specific teams.

The best global legal networks, on the other hand, can deliver the same levels of geographic and subject-matter coverage while also providing top-quality, highly skilled lawyers at competitive rates based on local market standards. What’s more, at legal networks such as Ally Law, many of our members are bold, innovative, first-generation firms whose success, even before joining the network, has been predicated on delivering excellent service.

Similarly, as a horizontally integrated organization, our member-firm partners communicate one-on-one with each other, meaning that client questions and rapidly emerging issues are handled directly and immediately. At Ally Law we believe in handshakes, not handoffs.

2. The “Great Resignation” will bear fruit for smaller, flexible firms

An unexpected side effect of the COVID-19 pandemic and the shift toward remote work and productivity-based (rather than hours-in-office-based) metrics is that smaller, nimble firms have been able to more quickly adapt their human resources policies to meet the needs of today’s legal practitioners and staff.

This shift in attitudes is perhaps best exemplified by the so-called Great Resignation. In many of the world’s largest economies, the expectation during the early months of the public health crisis was that employees that had not yet been laid off would cling even more tightly to their positions for fear of being set adrift during an uncertain economy.

In fact, the opposite has occurred. In the United States and elsewhere, employees – from junior associates to senior partners – are quitting their jobs at unprecedented rates. This is in some part down to changes at the individual level, as the heightened possibility of illness and even death often causes people to reexamine their priorities. However, at a more macro level many countries are experiencing a shortage of skilled workers. Job candidates in these markets often have their pick of employers and are demanding a quality of life that includes personal as well as professional opportunities.

Coupled with the growth of the “gig economy,” in which many workers are temporary staff or contractors, rather than employees, traditional law firms are finding themselves hard-pressed to adapt to the demands of a new cohort of lawyers. Many of these younger professionals assess the employer-employee relationship with a critical eye and are more willing to pack up their skills and take them where they feel they are more valued.

Small and mid-size firms, which make up the bulk of global law firm network membership, have typically taken an approach to work-life balance that now matches the broader employment environment. At member firms, relationships between firm leaders, seasoned lawyers and early career associates are more personal and direct. Compensation and benefit plans and employment policies – including working conditions – can be adapted quickly to meet the demands of the day.

While Big Law will always hold a certain attraction for some lawyers, many of the field’s best and brightest want to practise law at the highest levels in firms that also offer a more personal, welcoming and supportive environment – an environment that also translates directly into better service for, and stronger relationships with, clients.

3. Word is (finally) out: the law is a business 

For decades, the legal industry has seen itself as distinct from all other professions, with specific entry requirements, a code of conduct and unique career-advancement and promotion practices. No longer. Today’s most effective law firm leaders understand that they are providing services in a marketplace that follows the rules, pressures and possibilities found in virtually every other industry. As such, they are changing their mindsets and running their firms with business principles at top of mind.

A growing number of firms, for example, are changing their organizational and compensation structures to meet the demands of clients rather than the traditions of the past. Some firms are eliminating the partnership hierarchy altogether, treating all of their attorneys as part-owners of the enterprise. Transparency – in fees, compensation, bonuses and promotions – is replacing behind-closed-doors decision making.

Looking ahead: synergy, mutual respect and shared opportunities form the basis of a successful network

Synergy means that an organization is more than the sum of its parts. Rather, it is a well-oiled, lean machine in which each member delivers specific strengths that contribute to the smooth functioning of the whole. At Ally Law and other global law firm networks, these synergies don’t just arise when a new firm joins the network (although we certainly seek out high-quality firms whose local presence and practices complement that of the group): they grow out of our members' interactions with each other and are rarely imposed from the top down.

For example, at Ally Law, our Women in the Law and Young Leaders Development programs were the direct result of members creating expanded networking and career-growth opportunities for, respectively, women attorneys and promising, early career lawyers within the organization. Our industry- and discipline-specific affinity groups were likewise established by members interested in creating stronger relationships with like-minded and issue-focused attorneys across jurisdictions.

Mutual respect is another watchword for global legal networks, one that plays out positively for member firms and, most especially, clients. Before an invitation to join Ally Law is issued, potential member firms go through a rigorous vetting process to assess the quality of their service and counsel and their commitment to values we share.

Admission to Ally Law automatically confers respect, but it doesn’t stop there. New and long-time members alike participate in programs, host global conferences and regional meetings, and serve on various committees. This level of engagement strengthens relationships; shared expectations also mean that client satisfaction remains a top priority and member firms become each other’s preferred partners.

Finally, an effective legal network focuses on shared opportunities. More than just referrals from one jurisdiction to another, we actively seek out multijurisdictional engagements that, by definition, require us to work together efficiently on behalf of our clients’ best interests. The benefits of this approach accrue to our clients as much as to our network.

More than ever, the time is indeed right for global law firm networks. The COVID-19 pandemic and the subsequent economic impacts have taught us innumerable lessons. At Ally Law and in other top-performing legal networks, we are committed to making the most of this knowledge to provide better quality, more cost-effective legal services to our clients, now and in the future.