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A Day of Legal Innovation in London: Client Innovation Space + Flex Staffing

It may only be Tuesday, but is has already been an eventful week in innovation news from the London legal market. Two Magic Circle firms  and one Top 30 firm made noteworthy announcements today. Here is a quick recap, some additional insight from an email interview with Allen & Overy, and some of my initial thoughts.

Allen & Overy Fuse

Allen & Overy announced Fuse, a tech innovation space. It is “a new tech innovation space where tech companies, Allen & Overy lawyers, technologists and their clients will collaborate to explore, develop and test legal, regulatory and deal-related solutions.” Fuse joins a range of other Advanced Delivery services the firm offers, including Peerpoint flexible staffing, a low cost legal services center, and aosphere, online compliance advice:

Allen & Overy Advanced Delivery Including the New Fuse

To learn more about Fuse, I exchange email today with Shruti Ajitsaria, Counsel, Allen & Overy and Head of Fuse. Here are my questions and her response:

How does this relate to the i2 initiative announced [via an article The Lawyer] almost exactly one year ago?

“The key difference is that i2 is purely an internal initiative – it does not include a co-working space in which tech companies and clients are invited to collaborate.  It is an innovation process which encourages people within A&O to submit ideas about how we can best use technology to work smarter, deliver services to clients in new ways and work more collaboratively with our colleagues. Ideas are vetted by a group of A&O people and, if voted as having potential, they are piloted and tested internally in an agile way and then assessed for rolling out widely.  The point of intersection between i2 and Fuse is really the people who get involved – we expect that many of the A&O people who have submitted ideas to i2 will relish the opportunity to collaborate with the tech companies in Fuse and play a role in developing and testing new solutions.”

The release does not make clear what investment A&O will make beyond providing space. Is there a budget to provide services to these companies? Is the firm investing in R&D?  Trying to decide if and how to update my R&D list at http://j.mp/BigLawRD?

“We may invest in specific solutions that have real relevance to our business and that can help us meet our clients’ needs in smarter and more cost-effective ways, but we won’t be investing in all the tech companies with whom we work in Fuse as a matter of course. However, we will look for ways to support and nurture their development, through offering commercial and market knowledge to help them refine their product offering, access to a potential user community, whether within A&O or with clients, legal awareness programmes and helping them obtain mentoring and access to alternative sources of growth capital.”

I look forward to seeing if A&O continues to add services to its Advanced Delivery options. And to see what Fuse yields.

Linklaters Partners with Obelisk for Flex Staffing

Legal Week reports that Linklaters signed today an arrangement with Obelisk, which “a 1,000-strong pool of flexible lawyers drawn from magic circle and other City law firms.” The firm’s goal is “provide additional support on certain matters or to provide cover for absences such as maternity leave and sabbaticals.”

Several other London-based firms (e.g., A&O, Freshfields, Eversheds, Pinsents, and Addleshaw Goddard) have their own, similar staffing services and DLA Piper partnered in 2015 with Lawyers on Demand.

Pinsent Masons Doubles Down on Flex Staffing with Investment in Yuzu

A firm announcement states that Pinsents “has acquired a [20%] minority stake in ‘New Law’ start-up business Yuzu.”

Yuzu is creating an innovative legal services proposition for business that lies between in-house, traditional private practice and managed legal service models. It will offer its clients the opportunity to transfer parts of their legal function out of the business yet retain the best features of an in-house service. Yuzu’s clients will benefit from:

  • Moving elements of the legal function ‘off balance sheet’, thus reducing fixed costs
  • Leveraging the knowledge and expertise of an existing team
  • Improvements in operational efficiency arising from Yuzu’s investments in people, process and technology
  • The budget predictability and cost savings that come from service transformation and sharing resources

An article in Legal Business provides additional detail. I look forward to learning more about the Yuzu business and operating model in the future.

Note that Pinsents already has its own flex staffing arm, Vario. I look forward to seeing how the firm manages both offerings.

Initial Thoughts and Conclusions

UK firms seem to take alternative staffing and alternative delivery models far more seriously than do US firms. Certainly in proportion to market size – if not in absolute terms – I can cite more announced alternative staffing and alternative delivery models in the UK and US. For some years now, I have tried to understand why this is so but have yet to reach a conclusion. So comments, as always, are welcome.

 

  1. Tim Cummins

    Ron,
    As you know, I operate across the two jurisdictions on a daily basis and there is a distinct difference of attitude. I think there are subtle variations in perceptions of power and authority which lead to a greater acceptance of the need to innovate and compete. I see this within many corporations where in the US the legal team has retained tremendous power over contracts and related wording and policies, whereas they have a far looser grip in the typical UK company. In one, consulting the legal team is generally mandatory; in the other, it is often optional. Such a difference creates a greater sensitivity to the users of your service and a need to be more adaptive.

    On a similar note, it also leads to European law firms being far more interested in pushing into new areas and providing more market-attuned business services. It is interesting that, for example, a number of leading European law firms are active Corporate Members of IACCM whereas (with the exception of Baker &McKenzie) US headquartered firms are not. Those in Europe seem to see greater value in connecting outside the traditional boundaries of the profession, both to expand their knowledge and to expand their influence.

  2. Robin Saphra

    One reason is that the UK’s regulatory environment for legal services has become very flexible (thanks largely to the separation of the SRA and the Law Society) and incentivises UK firms to be more open to alternative models than their US counterparts – as they, and their clients, know that traditional legal services can be easily disintermediated by newlaw competitors.