Seyfarth Shaw is not your typical 739-lawyer firm. For one thing, in the midst of an economic downturn, and in the face of what the Association of Corporate Counsel terms a “slow-motion riot” by corporate clients everywhere, Seyfarth reported gains in gross revenues (+ 5.5%), net profits(+3.5%), and profits-per-partner (+5.5%) last year.
In an AmLaw Daily interview several months ago, Seyfarth’s chairman, Steve Poor, attributed the firm’s performance to its clear-eyed recognition of fundamental flaws in the large-firm economic model and the anticipation of what might happen to that model should the rising revenue waters recede. Poor stated, “Everyone loves rate-insensitive work,” he says. “But we realized several years ago: That model is fundamentally flawed. We realized a day like [the downturn] would come.” Armed with that realization, the firm redoubled its efforts to provide more cost-effective services.
At last week’s “Controlling Legal Costs” conference at Manhattan’s Harvard Club, Seyfarth stole the show with a stunning presentation by Boston-based partner Lisa Damon about the depths of its dedication to process improvement and cost-cutting through Lean Six Sigma methodologies.
Six Sigma process management, for those of you who haven’t encountered it, is a management philosophy that rigorously defines and measures and refines a business’s core processes and maps them back reiteratively to that business’s conceptualization of “success.” As Damon put it, this type of thinking has traditionally been “anathema” to lawyers. Lawyers have not been interested in process-based efficiencies, she noted, because we have made so much money from inefficiency. The more inefficient a process is; the longer it takes. The longer it takes; the more hours we bill the clients. The more hours we bill the client; the more money we make…up to the point when the client fires us.
Probably true…but Seyfarth is through the looking glass now. As part of their Lean Six Sigma implementation, their internal Green Belt teams precisely map out each discrete step in their standard processes (say, for example, filing a single-plaintiff employment lawsuit in New York) and then rigorously work to eliminate any unnecessary steps while smoothing the necessary ones. Then they constantly re-examine and refine those process maps.
How is this working for the firm? Damon reports unprecedented cost savings and sharp increases in customer satisfaction. And the firm’s overall numbers show how economic robustness and resilence can grow from a focus on efficiency.
Now…if they added a little document automation platform into the mix, I wonder how much further they could go?