Legal services sector: 'Focus and transform'  

Focus

This is about the day-to-day running of the business. A large part of this strategy relates to driving efficiency, continual improvement programmes, project management and containing costs, all disciplined activities. 

A prime example of this in practice, is process re-engineering whereby law firms take a legal process and reconstruct it to ensure that the different parts are done in the most efficient and cost effective way.

This means that some workflow components may be carried out by a qualified lawyer, whilst others may be completed using more appropriately qualified employees in a lower cost location. For real estate, this means locating the right staff in the right location for the right price.

In the UK, quite a few law firms have established north-shored operations for more process driven functions. Freshfields Bruckhaus Deringer, for example, have a large support centre in Manchester. Additionally, Hogan Lovells tripled its occupied space in Birmingham, in part to accommodate support roles transferred from London.

International firms are also building out shared service centres that can support multiple offices across the organisation.  Clifford Chance, for example, has a Delhi-based knowledge management team of over 500 people. Going forwards, more law firms will deploy these strategies along with a blend of outsourcing and automation. 

The ‘focus’ strategy also means utilising office space in the most effective way, particularly when it is in higher cost locations. Examples of space consolidation include Withers, who signed a lease to take 58,000 sq ft at 20 Old Bailey, EC4.

The newly refurbished 235,000 sq ft scheme currently owned by Blackstone is next door to Withers’ current location at 16 Old Bailey, EC4 - where the international law firm has been based for the past 20 years.  The firm is ramping up its use of agile working, allowing it to reduce the amount of space it occupies in London by about 10,000 sq ft.  

Transform 

This alternative strategy is about future-gazing and future-proofing; understanding the impact of the forces of change within the legal sector and taking positive action to stay ahead of the game. It is therefore more about continual innovation and regeneration, experimentation, creative thinking and agility.

This type of work requires a completely different mind-set, culture and skills set to the ‘focus’ strategy. Real estate that supports these strategies will depend to a large extent on the law firms chosen path. Some may feel that innovation and creative thinking can be done in-house with existing talent, resulting in the greater incorporation of collaborative space within existing space, and the roll out of agile working practices. 

Others will seek outside help, resulting in space being utilised within the office but which is completely different in terms of fit-out, or via new “third space” which sits outside of existing portfolios.  These third spaces are used to draw in and house outside talent and partners in an agile and flexible way. 

A good example is Allen & Overy who house start-ups in their tech innovation space called Fuse. Fuse is located within their London offices on the boundary of Shoreditch & the City of London. The design features a combination of open office space, workstation kiosks and secure working space. A coffee kiosk and lounge area enhance the community style feel of the space. 

Pulling it all together

Whilst both the focus and transform strategies may seem at odds with each other, there are some common strands. Underpinning both is a need for the right culture, a shared purpose and having the right talent on board. To maximise impact, real estate decision-makers must firstly understand how their law firm intends to operate.

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