I read Paul Lippe’s blog post yesterday about the shock in the industry of the demise of Heller.

A law firm friend of mine told me many of his peers were “shocked” at the demise of Heller and its failure to find a merger partner. That put me in mind of the iconic scene in Casablanca, where Vichy police captain Louis Renault declares himself “shocked, shocked to find gambling going on [in Rick’s Casino]” while pocketing his winnings.

I too have industry friends who were shocked, I wasn’t. I was reading between the headlines about the layoffs, failed mergers, practice defections and partner movement at Heller.

Paul is predicting that Heller is the first in a trend of law firm dissolutions and lays out his reasons why. I could not agree more.

As firms decide how to deal with the current economy, the employment numbers are out and it ain’t looking pretty.

The law sector saw jobs shrink by 2,000 in September — the fifth consecutive month of losses. According to the U.S. Bureau of Labor Statistics, the legal workforce of 1,165,100 is down by 1.15% from one year ago, when the industry employed 1,178,600 people. The drop-off is even steeper since May 2007, when legal employment peaked at 1,180,700.

On a world-wide basis, 28 companies went public during the month, down 67% from September 2007 and down slightly from the 29 in August this year, according to data from Dealogic. Just $181 million was raised, a fraction of the $9.4 billion in the year-ago period, and down from the $1.3 billion in August.

In every corner of the world, the amount of money raised by IPOs could have represented just one small deal during flusher times. In Europe, the eight deals that were completed raised a total of $21 million, down from 19 that raised $784 million in September 2007. In North Asia, seven deals, including three from China, raised $30 million, compared with 20 that raised $3.7 billion a year ago.

There were no IPOs in the U.S. during September; last year, there were four that raised $990 million. It has been five years since the U.S. has seen a month without any companies going public; the last time that happened was in April 2003.

But rather than panic at the bad news, lawyers and law firms need to realign quickly and take advantage of the new opportunities. Those who do will avoid the path of Heller and will reap the benefits at the end of the day.

With the stock markets falling and credit markets tightening, law firms across the United States are dealing with panicky clients and scrambling to form new practice groups focused on the economic crisis.

Walking around the halls this morning the mood is somber. Dow is under 10,000 points; Brazil is down 15%; Russia down 20% before trading was halted. Jim Cramer is warning that the stock market can drop 20%:

“Whatever money you may need for the next five years, please take it out of the stock market right now, this week. I do not believe that you should risk those assets in the stock market right now.”

I don’t want to get all Pollyanna on you, but I don’t want to go into a depression over this recession. I want to bring my best to the job today. I want to update the website, post that client alert, plan that client reception, and start looking ahead at 2009.

Yeah, times are gonna get tough, and I think we’re just at the beginning. I want to remain relevant to my job. As times get tougher, I believe it is more important than ever.

So go out and seize the day and contribute positively to the solution: Call a client. Schedule a business lunch. Update your LinkedIn connections. Write a client alert. Update your bio. Speak at a conference. Put your own client seminar together. I don’t care what it is, but get into action.

Don’t live in denial, but don’t hide under a rock. While I don’t think today is the day I’m going to start contributing to my 401k, it is the day that I start putting more money aside to invest in the stock market for when it starts turning around.
Oh, I’m going to start following some financial gurus on Twitter.

When bad service happens to good marketers, we get into action. We blog and micro-blog about it. We make phone calls. We don’t stand idly by and accept it as the cost of doing business or living life in a big city.

When I receive bad service, I report it … and then share it with 30 people. When I receive good service, I praise it and sometime remember to mention it to my friends.

So why is client service ALWAYS a hot topic for GCs? Time and time again I hear about phone calls not being returned, a disconnect between fees and value, billing issues, etc. Having had a career outside of legal, I know that lawyers have no problem complaining about bad service in restaurants and private clubs, at charitable or specials events, or in line at Disneyland. Yet, GCs don’t complain directly to their law firm when they have problems, complaints or other issues. They just start sending the work somewhere else.

Will ACC’s Value Challenge be the tipping point? Will they provide a forum for in-house lawyers to compare law firms and their attorneys? I believe that the tough economic times will force law firms to compete against one another on fees, value and service. The clear winner will be the clients, and those of us who value good service.

A discussion point on the Legal Watercooler is leadership. We have seen good leadership enhance a firm’s reputation, client base, and profits. Over the past several years, we have seen bad leadership, lead in part by greed or ignorance of business principles, result in the dissolution of several hundred-year old law firms across the country.

Leadership runs through our lives on a daily basis.

Leadership affects us personally: Who is leading my family? Who is leading my church, school, Girl Scout troop?

Leadership affects us professionally: Who is leading my department or team? Who is leading my firm?

Leadership affects our community: Who is leading our country? Who is leading our state, our city?

How do you lead? How do you follow? Do you think about your leadership skills and how they can affect your life: personally, professionally and in your community?

Ken Blanchard, a guru of gurus, has started a new website & blog on leadership that I suggest we all check out:

HowWeLead.org is a public service site devoted to leadership topics that connect us all. This site is non-partisan, and secular, and does not solicit or accept donations.

We believe that leadership can make all the difference, in organizations, in business, and in government. Leadership affects how people interact with each other, and provides the energy and direction for all positive change. Join Blanchard-hosted conversations on leadership.

Leadership is communicating to people their worth and potential so clearly that they come to see it in themselves. Stephen Covey, the 8th habit

One of the hardest tasks of leadership is understanding that you are not what you are, but what you’re perceived to be by others. Edward L. Flom, CEO of the Florida Steel Corporation

Law firm layoffs seem to be the “topic du jour” on blogs here and here, including around the cooler, see Heather’s post here and Renee’s post here . No one wants to get kicked onto the sidewalk, but when it happens, how will you pick yourself up?

In the old days we had to work the Rolodex, write letters, pick up the phone. Sometimes the Rolodex was slim. Cold calls were not for the shy, and cattle call ads were loathsome.

Okay…no excuses today. You can work your brand and your contacts with just 140 characters, 8 times a day. Yes, I’m talking Twitter – AGAIN. A lot has been said about the advent and uses for Twitter around the cooler. Here . And the ideas flow freely here and here.

Today I met @Chris Cheatham. (Without even leaving the office!) Chris is a construction law attorney in Northern Virginia. Chris has a great new blog www.greenbuildinglawupdate.com and although he is on LinkedIn he says Twitter is “one of the best social networking tools out there.” I can’t wait to talk to Chris tomorrow on the phone and get more of his story. I met Chris because he contributed to a LinkedIn Group discussion I started on building a personal brand using social computing. He wants to help me out on an article I’m writing on the topic and I hope to help him out with some new ideas. A mutually beneficial exchange, again, resulting from a business social network. And to think it‘s taking off so slowly among lawyers????

I KNOW the construction business is hurting just like finance, law, banking, and real estate. Do you think Chris is going to tell me that he’s pain free? I doubt it. Do you think Chris is going to say that working his Twitter contacts is efficient and effective? Of course! Chris is a lawyer and isn’t every lawyer interested in efficient and effective? Their Web sites say they are. (hahaha) So what is holding so many really sharp and “brandable” lawyers and marketing professionals back?

Building your brand online is a really smart plan, don’t you agree? How are you building your personal brand online and how has it worked for you?

Living on the Westside of Los Angeles I watched, jaw hanging open, as housing prices kept rising and rising. A 900 s/f tear-down in my neighborhood went from $360,000 to $900,000 in just a few short years. I was one of those doubters who kept saying, “Why would I buy now? We’re in a housing bubble.” Yet, time and time again, the pundits, realtors, bankers, etc. kept trying to reassure us that we were not in a housing bubble. Well, the bubble has burst, and it’s leaking all over everything.

In the legal community, we have watched the billable hour reach staggering rates. While $1,000/hour is still rare, $600-$800/hour is not. I would argue that just as the real estate and financial services bubbles burst, so too will the billable hour bubble. It’s just not sustainable at its current rate of increase.

Paul Lippe, founder of Legal OnRamp, in his commentary Welcome to the Future: Law After the Boom, argues that we, the legal industry, have been operating in boom times, and those days are over. The future in now.

For those of us who’ve spent most of our careers as clients, it seemed pretty obvious that the legal business was in an unsustainable boom. Consider: In a country where most people’s incomes have been flat or declining over the last eight years, and most companies face increasing global competition and flat profits, partners in big law firms generally saw their income double every four to six years over the last 15 years. And the firms have generally grown in profits, staffing, and revenues faster than most of their clients.

Law firms that realize they need to adjust their business models to the current marketplace will succeed. Those who do not will go the way of Heller, or Thelen, or any other firm that is slowly leaking partners, associates and practices. Really, how many billion dollar law firms can the global economy support? It will be interesting to see how the 2009 AmLaw 100 chart stacks up against this year’s.
Hey, let’s be grateful. It was a terrific ride. But clients, just like everyone else, want better service for a better price. As Paul surmised so well:

Today I’ll be meeting with an Am Law 20 partner who handles a lot of the company’s work. I’ll explain to the partner that every day of the year, every one of my client’s thousands of customers around the world asks, “How can you deliver more value to us for less money?” And every day, my client asks its suppliers, “How can you deliver more value to us for less money?”

At first, the partner will look at me like I am a little crazy and will say, “But you don’t understand, law is different.”

And I’ll reply, “Law is not different. Being in a boom is different, and now the boom is over.”

After a weekend of spa and “serenity,” I’m certain my husband was expecting yogi wife to walk in the door last night. That’s not what he got. Reflecting on my behavior this morning, I was sorry. Of course I was sorry. I didn’t like who walked in the door any more than he did. But, more importantly, I was wrong. And I let him know that. I was wrong. Period. No blame. Only responsibility. I was wrong.

So what does any of this have to do with marketing, or law firms, the economy or business in general??

Over the weekend I listened to most every word of the press conferences, debates and media interviews held by our country’s leaders. There’s a lot of blame going around, and a bunch of folks who are sorry to have to spend $700 billion on a Wall Street bail-out, but no one is standing up and saying, “We, as a collective political body, were wrong to let this happen.”

I don’t see the shareholders of WaMu being addressed by the golden parachuting CEO and BOD saying, “We were wrong to allow our greed to destroy this fine institution.”

I’m sure the C-Suite and BOD of Lehman and Merrill Lynch are sorry that their once fine and respected institutions have been destroyed, but will they admit they were wrong? Or will they just write a book, or get a gig on CNBC, or retire to their multi-million dollar estates?

And, as Heller Ehrman winds down operations, I’m sure there is a lot of sorry to go around, but who is standing up and saying, “We made bad business decisions, and we were wrong.”

And then I think of all the day-to-day office errors. How quick we are to shed our responsibility and blame the copy room, or the messenger, or a secretary, or the “other guy,” when, in reality, we were to blame. We were just wrong.

I’m sorry, but I’m just tired of everyone being sorry. It is time to stand up, take responsibility, and admit it when we are wrong.

Authentic is defined by Dictionary.com as:

  1. not false or copied; genuine; real: an authentic antique.
  2. having the origin supported by unquestionable evidence; authenticated; verified: an authentic document of the Middle Ages; an authentic work of the old master.
  3. entitled to acceptance or belief because of agreement with known facts or experience; reliable; trustworthy: an authentic report on poverty in Africa.
  4. Law. executed with all due formalities: an authentic deed.
  5. Music.
  1. (of a church mode) having a range extending from the final to the octave above. Compare plagal.
  2. (of a cadence) consisting of a dominant harmony followed by a tonic.
  • Obsolete. authoritative.

    • As Thursday came to an end and I reflected on the events of the week, it was hard to ignore that each day’s speaker echoed one consistent message, be authentic. The theme was unavoidable. From a brand management expert to Wall Street to social media, being authentic was an essential key to success and its absence, a recipe for disaster.

    The week started out on Monday with Lesley Everett an International Keynote Speaker and Executive Coach on personal branding. Lesley pointed out that our reputations are like pearls in an oyster formed layer by layer. Our motivators and strengths are the core of who we are. Her first rule is “Who You Really Are – A strong Personal Brand is authentic.” She reminded us that when the veneer is unauthentic it is exhausting to maintain.

    Tuesday I caught Suzie Orman on Oprah and boy was she mad about the lies that Wall Street and Main Street were living. She fumed at the way people constantly live beyond their means and how companies could misinform their clients. She insisted that we stop with the deceit and take immediate corrective measures to ensure our financial lives are in greater alignment with our values (translation: authentic). Oprah even asked “Does anyone remember layaway?” When was last time you heard a store offer that???

    By mid week, I was jumping from a tech conference to an LMA-LA meeting. Authentic made an appearance at both events. Chris Brogan my favorite person on Twitter was speaking about Social Media and Energizing Communities. He extolled the virtues of crowds gathering and sharing, noting that “everyone wants to be a Superstar but they are scared of honest feedback. A personal story is important when people buy from people.” I interpreted this to mean authenticity because as he further pointed out “communities aren’t targets and demographics, they are – sharing, emotional, reachable, and appreciative.” Deception has no place in a community that aims to thrive. After his presentations, a few of us grabbed a soda and continued the conversation regularly coming back to how social networking tells more of our story and requires us to be sincere.

    Next, I dashed off to hear Paul Burton speak about the need for QuietSpacing to conquer the Inbox. He pointed out most are not project or task oriented but rather reactive when dealing with the Inbox. He refocused the discussion on the need to get real about what needs doing. “Where is the project at? When do I need to think about it?” We often believe that something is important when a straightforward analysis would prove otherwise. Representational subject lines paint a better picture than recycled headlines. His point was to get out of the Inbox and over to the Calendar and drive your schedule. Basically be more authentic with your approach and allocation of time.

    Thursday morning I was on a call with Zale Tabakman and Marguerite Mcleod-Fleming about Using LinkedIn to Generate Qualified Leads. They encouraged people to admit openly that they mined information from LinkedIn and tie it into the approach. Don’t position yourself as a stalker. Share with the audience the process of how you came to know so much. Hello authenticity! Later that day I checked out The Cooler. According to Busy Little Bee authentic was essentially missing from the equation at Heller Ehrman. Goodbye inaccuracy and half-truths! The self-proclaimed Cruise Director is setting the record straight and navigating some very murky waters.

    This week drove home the point that you might be able to run from being authentic but you can’t hide and in the end, you’re just exhausted. Taking a sincere look in the mirror and admitting that something is broken or false is not for the weak. Even fewer make it to the next level of action. The heart of being authentic is being truthful and even smart with your resources. In a time where mistakes instantly become viral, it is imperative that we take stock of who we are and who we want to be, so that we may put our thoughts, actions and lives in alignment with our authentic selves.

    Why is living a reality so hard and uncomfortable? When you realize that you are unauthentic in your personal or professional lives, how do you respond?

    Heller partners vote to dissolve 118-year old firm on Friday. Check in with our friends at Heller Highwater for insider details as they start breaking.

    As I said earlier today, I don’t think that Heller will be the last of the firms to dissolve, or merge out.

    My best advice is to network, network, network. Download all of your contacts and start letting people know what’s going on. Update your LinkedIn, Facebook and Twitter profiles immediately. The LMA job bank is an active referral source.