However, as the Galley Slave Ship model has led to inflated hourly rates and billings across all practices while ignoring productivity and cost-effectiveness, that premise is now being widely challenged by the corporate and other wealthy clients which large law firms cater to, especially in the wake of the current deep econonic recession. Corporations and wealthy individuals who have seen their own business revenues and personal income slashed by the effects of the deep recession, and have been forced themselves to make painful cuts in staffing and overhead and personal lifestyle, no longer are willing to simply pay the legal bills that are submitted to them without question; or to agree to pay them in the first place without searching discussion. They are questioning the why, what, how and by whom their legal work is being performed; the billing rates being charged; and, most importantly, whether all of it is rationally tied to achieving their desired end result in the most cost-efficient manner. They are also demanding alternative fee arrangments such as flat fees or capped fees, or contingent fees based on specific results, which will guarantee that they get real value for their money, or at least limit their risk. M. Fleming, supra at 31-39. “They are asking for the specific reasons someone is charging $150 per hour and why another is charging $495. ‘Because that’s what the market will bear is no longer a viable response’.” Jessica Ferm, The Billable Hour Zombie: Why You Need to Act now to Avoid an Attack on Your Business (ABA Law Practice Today, July 2010) at 1 [hereinafter cited as J. Ferm].
Moreover, lawyers across all practices must cater to independent-minded younger generations of clients raised with instant access to the limitless information which the Internet provides, and who believe they are capable of making better decisions than their lawyers once the underlying material facts and applicable legal principles are explained to them. These Gen X and Gen Y clients as they are sometimes called, tend to be purely result-oriented. They are focused solely on the bottom line, unclouded by sentimental notions of professional relationship or loyalty. Consequently, “[s]ending a message about paying for your ‘time’ rather than ‘the result’ will not resonate (with them), and you may find yourself with a slowly dissipating pipeline.” J. Ferm, supra at 1-2.
The corrollary effects of the Galley Slave Ship model on lawyer morale are equally troubling. “General surveys reveal a grim picture of an unhappy profession, with a high rate of burnout, job dissatisfaction, divorce, depression, suicide, and drug and alcohol addiction. Job stress runs high, with unrealistic demands for billable hours, narrow specialization, inadequate opportunities for creativity, and intense competition for jobs, clients, and partnerships among the top laments. Many lawyers regret having entered law at all and contemplate leaving for another field. Every year, about forty thousand actually do.” Jean Stefancic & Richard Delgado, supra at 51.
Stephen M. Winnick, Esq. is the founder and senior partner of Winnick & Sullivan LLP (www.winnlaw.com); and the developer of Summary Judgment™(www.summjudg.com), a comprehensive case and practice management software tool built on Eastgate Systems’s Tinderbox data platform (www.eastgate.com/Tinderbox). Additional information about Summary Judgment’s features and operation is available in his prior blog series entitledWinvictus’s Summary Judgment – the Romero Case(www.winvictus.wordpress.com).
Copyright © 2011 Stephen M. Winnick, Esq. All rights reserved.