There certainly is plenty of bad news to go around. Enough so that it even has the good guys looking down at their shoes. What’s a law firm to do?

1. Passion And Leadership Are Imperative
Successful firms will have a strong, visible leader who oozes belief in the firm’s raison d’être and the client proposition. Passion spreads throughout the organization and becomes infectious.

2. Invest In The Future And Be Courageous
Defy conventional impulses and spend to grow market share. Studies repeatedly show that organizations that increase marketing investments during a recession grow market share, increase margins and have better long-term growth trends than their competitors who are not so courageous. See #1.

3. Creativity Is Not Optional
Best of all, it’s essentially free and populates the offices and break-rooms in your firm. You may have missed seeing it during the boom times. Don’t discount the potential contributions of secretarial, administration staff AND even those introverted lawyers. See #1.

4. Develop Trust, Connectivity and True Partnership
Give your clients voice. Give them what they need to be true “brand” believers and loyal forever. Innovation through client insights and experimentation can produce breakthrough ideas. Go to your core audience, ask them what they want, and give it to them. You may be surprised to learn that they truly want to be your partner. They want you to succeed so that they can succeed. Make sure it’s not just marketing speak on your web site. When they ask for something you think you cannot give, think again, they really don’t want you to fail. It may be just the right thing to do for both of you. See #1.

5. Integrate All Communications
Reach your potential client base through multiple channels, BUT, creatively deliver the same message across all platforms.

6. Be Accountable Together
Create a marketing culture of accountability. Partner with finance, technology, research and analytics to measure everything you can. Be grounded in a disciplined process that relies on a cross-functional marketing and finance team that reviews all activities. See #1.

7. Invest In People
Build skills, build capability, build knowledge, and watch the bottom line grow. Train even the most junior person in your organization to embrace the firm culture and philosophy. See #1. Aggressively pursue efficiencies and productivity. See #1.

8. Be Socially Responsible
Do good. Now is not the time to cut back too far. BUT, rethink your sponsorships and contributions. Do you have skin in the game? Now is the right time to go beyond cause “marketing” and have an inspiration and motivational reason for your firm’s brand to be involved in the community. Your clients will notice and reward you for giving back. See #1.

Thanks to Advertising Age staff writers for prompting these ideas. “Recession Proof Your Business”

With all the uncertainty the current economic crisis is bringing to the corporate marketplace, I am focused on how law firms are adapting.

Some firms are laying off staff and associates, some firms are holding off on welcoming new partners to the equity ranks, while others are closing down. In fact, this week’s trades are filled with reports that another AmLaw 200, #131 Thacher Proffitt & Wood, is in dire straits.

So perhaps someone out there can riddle me this: while laying off associates and staff, White & Case’s top partners have increased their billing rates to $1,260/hour. What?

I understand paying a premium fee for the expertise of marquee partners. But at what point does the client choke on the gall and close the purse strings?

The continued uptick in legal expenses means that law firms should expect clients, especially in a worsening economy, to hire more attorneys in-house and to rely more heavily on “flexible staffing,” said Pamela Woldow, general counsel and principal of Altman Weil Inc., a law firm consultancy. In addition, clients, such as pharmaceutical companies, that in the past did not demand alternative or varied fees will be “negotiating harder” for better deals on legal services, Woldow said.

So I started doing the math and came up with my own equation:

Legal Marketing Algebra

Higher rates = increase in legal expenses

Increase in legal expenses = bring more work in-house

Bring more work in house = less revenue for law firms

Less revenue for law firm = more lay offs

If your corporate clients are cutting back on expenses, laying off employees, shutting down offices or stores, closing down operations or preparing for bankruptcy, how do you justify $1,200 an hour for a lawyer?

But, then again, some people have no problem paying $5,000 for a hamburger.

2008 has been an interesting year in the legal industry. We’ve had major law firm dissolutions, legal scandals, and a collapse of the financial markets which has lead to weekly layoffs at the AmLaw 200 firms.

Marketing in a down economy is a common topic of discussion amongst my legal marketing peers these days. Looking at 2009, most firms that I have spoken to are in deep discussions about freezing their rates, if they have not already made that decision. While other firms are cutting marketing and business development budgets.

The headlines in the legal trades this morning highlight the latest trend for Big Law: the salary freeze. And it’s starting with AmLaw #2, Latham. And, might I add, it’s about time.

Knowing the legal industry as I do, as goes Latham, so too will the rest of the industry. Once all the law firm ducks get in a line, most Big Law’s pay scales will look like this next year:

  • First and Second Year associates – $160,000
  • Third Year- $170,000
  • Fourth Year- $185,000
  • Fifth Year- $210,000
  • Sixth Year- $230,000
  • Seventh Year- $250,000
  • Eighth Year- $265,000

Maybe it’s just me, but anyone else find that the sense of entitlement (read comments section) to a huge salary, plus bonus and annual 5-figure pay increases, appalling?

For every Big Law associate who would like to bemoan their lack of a pay increase, I’d be happy to introduce your firm to the 200 Thelen and Heller associates who are still looking for a job.

Well, the holidays are fast approaching and there seems to be no slowing down of the layoffs. Dechert, Wolf and Drinker are the latest firms to join the ranks.

We can debate from now until the markets recover the callousness of law firm layoffs just days before Christmas, but really, what’s a firm to do?

ABA Journal is reporting that some firms are switching idle attorneys to pro bono work.

Several law firms have switched lawyers experiencing idle time to pro bono work, the American Lawyer reports. The magazine says these law firms are among those making a change:
• Dechert, which has moved seven associates to full-time pro bono work because of a slowdown in structured finance.

• Cadwalader, Wickersham and Taft, which has increased pro bono hours.

• Akin Gump Strauss Hauer & Feld, where pro bono hours have risen to 85 hours per lawyer through September, compared to 69 hours per lawyer last year.

• Skadden, Arps, Slate, Meagher & Flom, where new associates have more free time than usual to devote to pro bono.

ABA President-elect Carolyn Lamm has endorsed the idea of creating more pro bono work for lawyers who would otherwise be laid off.

I have another wild and crazy idea. It’s called Marketing & Business Development.

  • Educate yourself on new trends and technologies, such as SEO, blogging and social networking, and how you can use these to position yourself and your practice.
  • Start spending quality business time on LinkedIn, Twitter and Facebook, reconnect with former law schools friends and former colleagues. Learn how to uncover and develop new relationships
  • Identify recent court rulings, new laws, pending legislation that your clients would find relevant to their businesses. Use this information to:
  • Identify recent court rulings, new laws, pending legislation that your clients would find relevant to their businesses. Use this information to:

– Create a CLE program that you can deliver to clients in person, or via webinars
– Start your own blog, or provide content for the firm’s blog
– Write an article or newsletter for a trade journal

  • Attend any and all networking events, even if it’s on your own dime
  • Update your bio taking into account SEO
  • Update your practice’s marketing materials, including recent case/matter descriptions
  • Schedule daily lunches with firm attorneys, outside your practice, to expand your internal profile
  • Be available to “volunteer” when anyone needs assistance

If your current practice is dying, or dead, for the near future, you will need to identify what practices will be in demand in 2009 and beyond. If you find that you will have to reinvent yourself, take inventory of your current skills. What can you adapt to meet these future practice needs? What skills or education will you need to develop? Focus on these areas.

On the flip side, there are things that you should not be doing. You should not:

  • Start coming in late and leaving early
  • Socialize in the halls with other associates who are not busy
  • Think of this as free time for the gym, hanging with friends, or going to movies

We have to remember that there are business cycles in every industry. There will always be attrition and layoffs at the end of every calendar year.

However, unless your firm is shutting its doors, the majority of you will have a job come January 1st. What are you going to do, today, to ensure that you are one of those who will be passed over during this round of layoffs? What are you doing today to ensure that when the next round of layoffs come (and they will), that you and/or your practice are perceived as too valuable to the firm’s health and recover to be let go?

What are you doing today to position yourself to be in the right place at the right time? FYI. It has NOTHING to do with luck.

Not sure what it’s been like where you live, but the Salvation Army’s Red Kettles seem to be few and far between here in L.A.

I started an on-line Kettle for my kids to fill a few week ago, and we quickly went over the top.

If you haven’t had a chance to drop some change into a Red Kettle this year, here’s your chance.

Personal fundraising widget for 2008 Red Kettle campaign

I for one am not so distracted by this week’s scandals (Blago & Dreier) to overlook that today is LFLF – “law firm layoff Friday.”

Seyfarth had this announcement to make this week –

Seyfarth Shaw has laid off about 30 lawyers and staff employees firmwide, according to the firm’s Atlanta managing partner, Paul P. Mattingly. He declined to say which practices were shedding lawyers, but did say the cuts were in practices most affected by the economic downturn. “Since layoffs have become so pervasive, clarifying that they were not for performance reasons, but because of market conditions, seemed like the fair thing to do,” said Mattingly.

Nothing like stepping up to the plate and knocking one out of the park. The partners at Seyfarth Shaw have stood up before their peers and acted like the “professionals” most lawyers aspire to be.

By standing up and saying that these young men and women are being laid off for economic, not performance, reasons, Seyfarth Shaw will aid them down the road. It will also aid the firm’s reputation as our industry and the economy recovers.

Having to lay people off just weeks before the holidays could not have been an easy decision. By doing it well, I just have to top my hat and say, you’re one class act, Seyfarth!

Today’s AmLaw Daily carried a great post today, THE CHURN: CMO Edition.

The article points out the fanfare that welcomed two recent AmLaw 100 CMOs, both of whom came from outside the legal industry, and their departures four and eight months later, noting that “a law firm’s culture and structure can require more adjustment than someone arriving from corporate America may expect.”

And while I am saddened to see that the churn of law firm CMOs continues, I’m not surprised. The answer isn’t money. The answer isn’t more “strategic” v. “tactical” work. It’s more complicated than that, but it always begins with the interview and hire, and red flags missed or ignored.

It is easy to conclude from the article that both these firms made a bad hire, for their firms. This has nothing to do with the character or quality of work performed by the CMOs. From what I have heard of their reputations, they are both incredibly talented individuals.

Unfortunately, they were not the right fit for these firms. So the next question is, “Could these hiring mistakes have been avoided?” Absolutely.

I’ve often counseled marketing professionals on how they cannot afford to ignore the red flags during the interview process. Far too often I have found that either the candidate or the firm becomes willing to do or say anything to seal the deal. I recently put together a post on the questions I like to ask during the interview process.

Looking at the AmLaw Daily article again, I see a huge red flag for each firm. The first firm was filling a position that had been open for 20 months. Why had they not been able to fill it? And, upon realizing that they could not find a candidate from outside the firm, why not promote from within? Who had been doing the job in the interim? Were they doing a good job? Did the person cultivate the trust of the partners? Were they leading the team well? Is that person still on staff? If so, how would bring in a new CMO affect the current operations of the marketing department?
For the second firm, the candidate hired was given the title of “chief marketing strategy officer.” He was hired above the current CMO, chief client relations officer and chief communications officer. Really, how many chiefs does a firm need? I cannot believe that this was a structure that could lead to anything other than resentment by the current chiefs, and eventual failure for the chief of chiefs.

And now I’d like to share with you the biggest and dirtiest little secret. A secret so scandalous that no one likes to talk about publicly, but we all do privately.

Some law firms have really bad reputations within the industry and no seasoned legal marketing professional, in his or her right mind and worth their weight in gold (or Euros, or U.S. currency), would ever interview with them.

There. I said it.

The churn of law firm CMOs will continue at some firms until they take a good look internally at WHY these highly skilled and highly paid professionals go screaming out the door, on their own accord or not, within months of arrival.

I’m reading Malcolm Gladwell’s new book, Outliers: The Story of Success. If you haven’t picked it up, I highly suggest you do. Chapter Five is dedicated to The Three Lessons of Joe Flom. Yes, that Joe Flom. Skadden, Arps, Slate, Meagher and Flom, Flom. Skadden is one of the firms all the other firms aspire to be. It is the premier litigation shop in New York, if not the entire United States. You go to Skadden with your “bet the farm” cases. You go to Skadden when you are facing serious federal jail time. You go to Skadden when you don’t care what hourly billing rate you are given. You go to Skadden for results, and, from what I have seen, few people, if any, are every dissatisfied. Yet Skadden didn’t start out that way:

In the beginning, it was just Marshall Skadden, Leslie Arps – both of whom had just been turned down for partner at a major Wall Street law firm – and John Slate, who had worked for Pan Am airlines. Flom [who did not receive any offers during hiring season] was their associate …. “What kind of law did we do?” Flom says, laughing. “Whatever came in the door!” Outliers, p. 118

Skadden Arps began by practicing litigation. Litigation that the Wall Street firms would not touch because it was beneath them.

The old-line Wall Street law firms had a very specific idea about what it was that they did. They were corporate lawyers. They represented the country’s largest and most prestigious companies …. They did not do litigation; that is, very few of them had a division dedicated to defending and filing lawsuits. Outliers, p. 124

Skadden became Skadden by finding a niche (litigation) and practicing it well. When the corporate takeovers began in the 1970s, Skadden was well positioned to become the go-to law firm. So, what’s the point of the story? I think there are many, but you’ll have to read the book to find the ones that resonate with you.
I, for one, forget sometimes that so many of our firms have been built on the humble backs of hard working men and women. Go through the framed degrees on the walls of your founding partners and you will find amongst the Harvard and Yale degrees, Brooklyn Law School, Seton Hall University, Pepperdine University, University of San Diego, and Southwestern University School of Law.
While it is admirable to aspire to the reputation of Skadden Arps, it is just as admirable to aspire to the tenaciousness of Marshall Skadden, Leslie Arps, John Slate and Joe Flom.

For any legal folks who were MIA on Friday, Marc Dreier, sole equity partner for Dreier LLP and all of its affiliates, was arrested for impersonating an Ontario Teachers’ Pension Plan attorney in a sham business transaction. Here’s the best recap of the scenario that I have found, Dreier Law Firm on the Brink After Founder’s Arrest.

Then there are the rumors of an inevitable dissolution, that there is no money for payroll, Blackberry’s will be turned off on today, and the empty escrow accounts.

Not a great way to begin the holiday season.

On Friday, little did the staff know that while they were preparing for their holiday party at the Waldorf, looking forward to receiving their bonuses, and feeling pretty darn lucky to have a stable and secure job in an insecure economy, their worlds were about to come crushing down.

The loss of the Dreier firm is shocking for all those who work there, but it is also tragic for all of us who looked to their business model as a possible alternative to the mind & grind models to which we are all accustomed.

After I left big law, I spent a long time interviewing around for the “right” firm for me. Dreier’s LA office was on my short list. They were just starting out, still in the construction phase of the build out. It was pretty exciting. They had an alternative billing structure: Partners could bill what they wanted, as long as they met their financial obligations to the firm. No more pushing a partner out the door because he or she couldn’t get $700-$800 an hour. They could set the rate that was right for them and their client base. No minimum billing requirements for associates. Why should they get penalized or punished if the didn’t have work? Wasn’t it the responsibility of the partners to pass it down?

There was an excitement in the air at the firm. The partners and associates were energized. The staff was ecstatic. Who wouldn’t want to be a part of that?

For the past couple years I’ve been watching the firm grow, be successful, grow some more. They were getting great press. Great laterals. Grow. Grow. Grow. The alternative model was working.

Unfortunately, I didn’t get that job.

But my good friend did. And I was excited for her.

And the sister-in-law of one of my guests at my daughter’s birthday party just started working there. And the husband of one of my favorite peeps is a partner there. And the COO who interviewed me was a really, really nice guy.

And now it looks like it will be gone, just like that.

Unlike those who are getting laid off here and there, which are tragic stories in and of themselves, the Dreier folks will not receive 2-week’s notice. They have no final paychecks. Who knows when, or if, they will get their sick-time and vacation-time paid out.

And then I think, “How many of these partners will be willing to take a risk again on an alternative business plan?” How many will simply return to the safety of mind & grind or “eat what you kill”?

I know that groups of partners will hang their shingles out today and they will be fine, once the shock wears off. So now I turn my focus to the the secretaries, tech geeks, associates, receptionists & office services, HR and marketing professionals. Will they have a job today? With benefits??

What we can do.
I just hope that everyone reading this can take a moment today and reach out to your friends and colleagues at Dreier. Do what you can to support their job hunting efforts.

I’ve already reached out to my friend, passing along job leads for her and her staff. And for those who haven’t looked for a job in the past year, I highly suggest that they read You updated your resume … now what??

The 2.0 ball is in full swing. The invitations have been sent out, the limos rented, and I’ve already found me a date.

The world is a Twitter, we’re hooking up with old friends on FB, and connecting and networking on LinkedIn.

Legal OnRamp, JD Supra and AVVO came along, catering to a specific need in the legal marketplace. They’ve got traction.

And, now the rest are sssslllllooooowwwwwllly coming on-line. Each new 2.0 application comes with promises of being new, better, cooler, different. Yet most seem outdated, clunky and difficult to use.

Riddle me this: If what I am doing works for me, and is working well, why should I abandon it and try something different? And, from what I’m hearing from my peers in the marketplace, they too are pretty satisfied with the 2.0 tools they are currently managing. There is room for improvements and enhancements, but not for more of the same.

It’s December 2008. Where’s the need now for Martindale Connected? I like the product. First heard about a year ago. It still hasn’t launched, and who knows how much it will cost when if finally does.

The ABA’s Legally Minded rolled out this week to lack-luster reviews. In addition to the frustrating registration process, I can’t figure out why I would need Legally Minded when I’ve got Legal OnRamp? And LinkedIn. And Twitter.

Unless your new application can fill a need not currently being met, or can improve on a current product (like Tweetdeck), I’m not interested. My 2.0 dance card is filled right now.