The Top 50 Law Firms of the Am Law 200 Are Investing in Innovation: Firm Management is a Prime Area of Focus

A New Report by ALM's Pacesetter Research Team Finds that Law Firms are Able to Move the Needle on KPIs Through Innovation in Firm Management

NEW YORK, Nov. 21, 2024 /PRNewswire-PRWeb/ -- In the first of a series of reports on innovation in law firms, ALM's Pacesetter Research team has delved into where the Top 50 of the Am Law 200 are focusing their innovation investments in firm management, and where those investments are paying off. Within the law firm management pillar, the Pacesetter team looked across Professional Business Leadership, Internal-facing Legal Operations Capabilities, Talent Strategy, Internal-facing Project Management, A Defined Innovation Strategy, and Business Structure or Model.

"Discussions about innovation in law firms usually focus on what technology investments they're making," noted Tomek Jankowski, Director of Pacesetter Research, ALM. "However, as this report explores, those firms willing to better manage the business side of their firm are gaining real traction with year-over-year margin growth, cost-per-lawyer management, and lateral hires."

Key trends identified in this research include:

• Looking across firm management as a category, firms of the bottom 25 of the Am Law 200's top 50 dominated the top quartile in Pacesetter scores, reflecting a strong desire to break into the top 25
• The innovation investment focus in talent strategy is universally the primary area of focus for all law firms in the Am Law 50, but with the added impetus that with the brand power, the Top 25 are winning with hiring and lateral hires – though their retention rates are also slipping since the pandemic
• Less than a third of firms in the top 50 of the Am Law 200 have a formal innovation strategy (complete with dedicated management and monitoring resources), but those firms that do excel in key Law.com Compass performance metrics
• Most firms in the top 50 of the Am Law 200 have adopted some sort of multi-tier equity partnership model but not all have reaped benefits from doing so, indicating that how these partner changes are implemented matters

For these reports the Pacesetter Research team profiled each of the top 50 firms of the Am Law 200 to develop detailed portraits of their innovation investment strategies and programs, and then evaluated and compared those profiles to generate insights in aggregate about both where law firms are making their innovation investments, what was working – and what wasn't. These firms' Pacesetter scores were also compared to the most common Law.com Compass performance metrics to see what correlations existed between innovation investments and real firm growth goals. This line of research examines innovation in law firms across four basic pillars: firm management, client engagement, service delivery, and value proposition. Each of these four reports will be available in 2024.

Law.com Pro and Law.com Compass Subscribers can now access the new reports by going to: http://www.law.com/compass.

This new line of research was launched in 2024. In 2025, these same reports will be based on analysis of the full Am Law 200, as well as mid-market firms, and the Global 30 firms in the UK. This new research will also examine innovation and its impact in the competitive environment for law firms, as well as the impact of innovation in specific domains of expertise (e.g., IP, M&A, antitrust, etc.)

About Law.com Compass Pacesetter Research
Law.com Compass Pacesetter Research provides independent, objective research to competitors in law markets relevant for both service providers and buyers alike, examining how innovation can inform decision-making processes. The ultimate focus for Pacesetter Research is how law firms (and their competitors) use innovation to have real client impact, to move the needle meaningfully for clients and other key stakeholders.

About ALM
ALM is the most trusted media, information, and intelligence company supporting the practice of and business of professionals in the legal, insurance, commercial real estate, and financial services industries. ALM delivers leading data, intelligence, insights, events, and audiences essential for growing businesses globally to over 7 million professionals. Please visit alm.com for more information, and visit http://www.alm.com/events/ to learn about our upcoming events. Please follow us on Twitter at @ALMGlobal_.

Media Contact

Eliza Sawyer, ALM, 2124577919, [email protected], www.alm.com

SOURCE ALM