Michael Bradley is the Managing Partner of Marque Lawyers, a boutique law firm in Sydney. Michael established the company in 2008 with the stated ambition of completely revolutionising the way law is practised.

Marque Lawyers got rid of timesheets, created an entirely new business model to support how they wanted to engage with clients, and said goodbye to all the unnecessary barriers which lawyers tend to unconsciously place between themselves and the rest of the world.

When not running Marque, Michael writes extensively on legal and social justice issues. Michael is one of the pioneers in NewLaw. That’s the topic we’ve contacted him to discuss further.

I: At Marque Lawyers, you have a completely different business model from the traditional one. Why did you move away from it?

M: Because it’s broken. The traditional model has two essential features: charging on a time basis; and measuring performance against financial targets. For clients, this means that they pay for legal services in a way which has no relationship to the value they receive; in fact, the less efficient the service is, the more they pay. For lawyers, it means that their effort is recognised and rewarded not on the basis of skill, experience, complexity, efficiency or innovation, but on how much time they spend doing the work. It also means that they are in perpetual competition with their own colleagues. None of these outcomes is conducive to cooperation, collegiality, trust or functional relationships. They produce the opposite effect. We moved away from all this because we wanted to be lawyers and happy at the same time, and to achieve that we needed to completely redesign the model.

I: In your article ‘A View from the Trenches’ in our eBook you say that you don’t charge by the hour and you don’t use timesheets. How has this affected your firm?

M: It changes everything fundamentally. In a time charging law firm, each lawyer’s world is governed by their timesheet. It tells them whether their day has been successful or unsuccessful, which is defined by whether or not they met their chargeable hours target. Necessarily, everyone’s focus is drawn exclusively to that task (meeting budget), which creates an intensely myopic perspective of the business in which they work and the clients they serve. For us, that doesn’t exist. Our focus is on the clients’ work and client relationships. We set expectations for those, and we are each free to manage ourselves and our time in whatever way best suits us, while being accountable to those expectations. We have none of the bizarre incentives which timesheets create – such as the incentive to waste time, or make up time, or make up unnecessary work to create more time. What matters to our clients – their business – is the same as what matters to us, because it’s how we measure our success. Timesheets measure something entirely different and often in conflict with the client’s interests.

I: Michael, recently there has been a movement in the legal industry towards the popularly called NewLaw. Do you think the legal sector is changing or it is just a fleeting trend?

M: We’re seeing an accelerating wave of change. Most of that change will be externally imposed on the profession. The so-called NewLaw is not really as exciting as it’s being hyped in many respects, but there are a number of emerging providers doing genuinely differentiated things and having an impact. That will continue and grow with increasing rapidity. This is not a trend. As I said earlier, the traditional model is broken and the firms who are clinging to it risk going the way of Encyclopaedia Britannica.

I: Do you think most clients are open to work with NewLaw firms or they feel more comfortable with the traditional firms?

M: I don’t think there’s much point trying to generalise about that and I can only usefully talk about our own experience. What we’ve found increasingly, as we’ve gone on and our market profile has become more established, is that there is endless demand for new ways of thinking about legal service provision and most clients are at least interested in finding out more about it. Larger institutional clients typically find it a bit harder to shift away from what they are used to, and that’s understandable. As the market becomes more fragmented and firms like ours look less and less like a risky choice, I expect that non-traditional firms will do even better than they are now.

I: Michael, how do you imagine the future of legal industry in terms of legal technology adoption?

M: It’s interesting that lawyers have so far mostly managed to use technology solely to make their own lives worse. However, that’s gradually changing for the better now. Technology facilitates enormous flexibility for a knowledge industry like ours, which challenges the notion of fixed office space and should make us wonder what exactly is the point of 1,000-lawyer firms. Technology will increasingly drive low value work away from expensive time-billing lawyers, making it much harder for firms to continue lazily accruing profit simply from taking a margin off the top of charging by the hours for lots of lawyers doing relatively meaningless work. Profitable business will still be entirely feasible for law firms, but they’ll have to earn it and, to do that, they’ll have to align their price to value. It’s all pretty exciting.

I: Finally, what would you advise those legal professionals who are timid about new business models and non-hourly pricing?

M: Well, the dinosaurs didn’t see the meteor coming, so we can’t blame them for their own extinction, but law firms have no such excuse. But the truth is that, if they look at change from a perspective of fear and unwillingness, they are likely to be paralysed by the prospect and make poor choices. My advice is to go sit in a park, let go for a moment of all the reasons why not, and imagine the possibilities. That’s what we did.

If you’re curious to read more from Michael Bradley, visit his column at The Drum online or download a copy of our E-book 25 Secrets to Success with Alternative Fee Arrangements.

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