Baker Tilly report reveals law firms are now recognising need to innovate
30 May, 2013
A quarter of law firms expect to change their business strategy in response to the Legal Services Act, according to a report and survey released by Baker Tilly today.
The figures show an increase over the last three years in the number of firms that expect to change their strategy – up from 9% in 2010, to 25% in 2013. The report also revealed a drop in the number of law firms that believed the Legal Services Act will have a positive effect on their business, with 21% saying they expected the legislation to have a positive impact in 2010, compared to a much lower 14% in 2013.
The report entitled ‘Legal Innovation 2013’ reviews the changing landscape for the legal services sector, studying how businesses have changed their structure, funding, service delivery, management and people, in both the UK and on an international level. It also examines how the landscape will change within the legal market in response to recent changes in the sector.
George Bull (pictured), Chair of Baker Tilly’s Professional Practices Group said: ‘This report demonstrates that real change is now being driven in UK legal businesses, both by shifts in the general market climate and the significant regulatory shakeups of recent years. In some quarters a degree of innovation has been unleashed which is unprecedented. It is also interesting that in many cases, law firms that previously held the view that reforms would have little impact on their business are coming around to the view that they will have to adjust their business model. The realisation that change will be necessary appears to be steadily growing.
‘Regulatory change has been most pronounced in connection with personal injury work so it is not surprising that we see the greatest amount of market movement here. However, this part of the market has not reached a new, mature stage yet. Long-term success for providers of retail legal services will depend on building a lifelong relationship with clients.
‘Elsewhere in the legal sector, early-stage experimentation has produced new types of legal business models which are not always attractive to funders. Here, innovation has not yet been reflected in market change. This is particularly evident among legal businesses providing services to business clients: we have not yet seen a real game-changer enter the market.’
A copy of the report can be downloaded from the Baker Tilly website www.bakertilly.co.uk.