New Zealand Law Society - Why specialisation is only part of the answer for lawyers

Why specialisation is only part of the answer for lawyers

Why specialisation is only part of the answer for lawyers

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When I worked in London in the early 90s, I worked in a small two partner firm in the Inner Temple. We had a wide client base who had all sorts of problems. We were what some might call a ‘generalist’ firm. The rule was that we took anything on, and generally did. One of the ways we did that was by making good use of the specialist bar which allowed us to draft in expert advice when we needed it.

Contrast that with the more recent trend for boutique law firms that specialise in only one area of law (eg, employment or IP) or which specialise in only one market segment (eg, sport or technology).

Outside the large firms, generalist small firms are becoming fewer because all young lawyers are told to specialise. But is that a good thing?

Why specialise?

There are two very different reasons why lawyers are told to specialise. The first relates to the growing complexity of law. Take employment law as an area in which practitioners specialise and where boutique firms have emerged. In any area of law which is judged by what a fair and reasonable employer could do (s 103A Employment Relations Act 2000) it is easy for a ‘non-employment’ lawyer to trip up or give misleading advice. Of course, that then raises the spectre of professional indemnity claims – something all law firms seek to avoid. Have too many of those and your insurance premiums start creeping up.

The second reason has nothing to do with law at all, but marketing. There is a term called ‘niche marketing’ which essentially means concentrating all your marketing efforts on a very specific market segment with clearly identifiable needs. By marketing yourself as the expert to this niche, you will stand a far greater chance of winning the work compared to someone who is a ‘jack of all trades’. This theory holds true, but up to a certain point.

The lawyer’s dilemma

There is no doubt that consumers seek out experts. If I need open heart surgery, I am going to seek out a heart surgeon, not an orthopaedic surgeon. But if my heart surgeon finds something wrong with me whilst under the knife, I want her to call in the appropriate expertise to assist. Therein lies the problem for specialist lawyers.

In this day and age clients have more complicated problems which may span various areas of law or even different jurisdictions. As a specialist lawyer this poses a dilemma: do you give advice on something you don’t know much about (and risk a PI claim) or do you refer your client to a rival firm who holds the expertise (and risk losing the client to another firm)?

That’s a tricky decision to make and will often involve a delicate risk assessment on both sides of the equation. This decision illustrates the problem of specialisation: you can’t be everything to your client.

Don’t think the big firms have it right

If you are sitting in a small firm thinking that the big firms have it right, don’t assume the grass is greener on the other side. Whilst it tempting to think that when you have a multi-faceted problem in a big firm you can stroll across the corridor to the person with the expertise, that doesn’t always happen. That’s because big firms have their own internal politics to deal with. Probably the same politics that saw the employment team set up their own law firm. Research conducted by Heidi K Gardner reveals that whilst lawyers are good at delegating downwards (ie, to junior lawyers) they are not very good at collaborating with their peers. That’s particularly the case for ‘solo specialists’ who have earned their reputations by becoming good in the niche and working on their own. Collaboration is a foreign concept and offers little value to them (so they think).

Where does that leave the client?

In a recent survey of 79 New Zealand consumers of legal services carried out by Approachable Lawyer, 55.6% said they would prefer access to a team of lawyers each with their own expertise who work together on their business, with only 37% saying they preferred to deal with just one lawyer. There is nothing surprising about these statistics. Some respondents clearly value the relationship they have with their lawyer but the majority express their preference for specialist advice. But what if you could have both? That’s where the generalist lawyer holds all the cards: until he drops them.

Fortunately, this conundrum is not without a solution, which is specialist collaboration. However, that uncovers an even bigger problem for big and small firms, namely how do you do it?

What are your thoughts on specialisation vs generalisation and do you think the profession can adapt to specialist collaboration?

This is the third in a four-article series on themes arising from a recent survey of 79 New Zealand legal services users. Michael Smyth is a sole practitioner and director of Approachable Lawyer Ltd. He has been in private practice for 22 years, six of those working in London. Michael has a keen interest in understanding how legal services can be delivered more efficiently to meet the client needs.

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