Smart Growth: The Large Law Firm in the Twenty-First Century

Abstract

A “standard story” has emerged to explain the growth of the large firm, an account by now so well accepted that it hardly gets challenged or revisited. This standard account, however, fails to adequately describe the actual rich and vibrant world of large law firms. Instead, it only explains a subset of the large law firm universe, the old Wall Street elite firms and their progeny. A key, therefore, to understanding the complex world of large law firms, is to broaden the scope of inquiry and move past the standard account as a one-size-fits-all explanation for the rise and growth of the large firm. Offering a detailed case study of one Am Law 200 firm, this article questions some of the basic assumptions and predictions of the standard story, suggesting that large law firms may be able to move from a narrow emphasis on corporate law and the service of large corporate entities to more diversified practice areas and client bases; to transition from an associate-heavy organizational structure to a stable partner-heavy model; and shift from brittle, organic growth models to smart, strategic alternatives. Whereas the organic growth of early elite large law firms in the twentieth century was, in many ways, a function of increased demand for corporate legal services by large entity clients, in the aftermath of the Great Recession it is not at all clear that similar demand will persist, or that it necessitates the organic growth of large law firms. Some large law firms would find it effective and profitable to grow globally by opening offices and by recruiting attorneys from around the world with the goal of targeting the business of global entity clients. Others will remain or become international in the limited sense of serving clients all over the world from only one main location in the United States or outside of it, with or without the use of a global lawyer workforce via out-sourcing and off-shoring. Some firms will remain mid-size, big enough to offer high-end, specialized legal services in complex transactions nationally, and perhaps even super-nationally, but not large enough to offer global legal services. And yet others will choose to remain or become regional actors, offering more localized expertise, within and outside the United States. Ultimately, the fate of large law firms depends not on a generic commitment to growing organically, but rather on their ability to develop and implement smart strategic growth plans attractive to their clients and attuned to their needs.