In a recent article appearing on law.com, Paul Lippe, founder and CEO of Legal OnRamp (a social networking site for in-house lawyers), expressed an interesting view about the future of the firm business model.
He believes, once things begin to turn around, firms will be much less leveraged. He expects firms to: 1) outsource more work formerly done by associates; 2) employ cheaper contract lawyers (i.e., those who are not on any kind of partnership track) to handle some associate work; and 3) employ more technology to supplant some of the work done in the past by associates. Less associate billings will mean less revenue for firms (he predicts a 20% drop), which will require them to cut at least 40% in overhead to maintain profits.
Read the whole article, which explains how the outmoded law firm model came to be and why law firms will need to restructure in order to succeed going forward.