More for less must be new mantra, says DLA Piper Global head Stephen Allen

ONE of DLA Piper’s star recruits was visiting Australia this week with a message some of his partners might find startling.

DLA Piper global head of propositions Stephen Allen.

ONE of DLA Piper’s star recruits was visiting Australia this week with a message some of his partners might find startling: the unit cost of legal services has to fall.

Stephen Allen, who holds the title of global head of propositions, joined DLA Piper three months ago with the goal of helping the firm adjust to the changing nature of the legal services market.

A key factor driving those changes is the pressure on corporate consumers of legal services to drive down their cost base — ­including the cost of legal services.

“There is downward pressure on costs like there has never been before,” Mr Allen said. “When you hear this ‘more for less’ comment, I think it’s true.”

While he believes the unit cost of legal services must fall, he also believes there is unlikely to be a reduction in the total cost of legal services to business. This was due to business facing a huge increase in compliance costs triggered by the surge in regulation after the global financial crisis.

And the problem was not just the quantity of new regulations, but their low quality due to the haste with which governments were bringing them into force.

“We are increasingly seeing regulation in the place of legislation. There has been a fundamental change,” he said.

Mr Allen, who has been managing director of two divisions of Orange-France Telecom, was a partner at accounting giant PwC, where he established an international advisory practice on legal services.

His arrival at DLA Piper coincides with the rise of alternative providers of legal services using different business models and ­innovative pricing.

These new methods of delivering legal services meant DLA Piper had to change, he said.

“We have to deliver different services to our clients, but we need to understand that clients need to deliver more for less. We need to understand we need to deliver holistic services — whether or not we do all of that work ourselves.”

Mr Allen said the challenge for firms like DLA Piper was to come to terms with managing the risk of sending some of their clients’ work to legal process outsourcers or outside lawyers who were only used for particular projects.

Mr Allen said the legal services industry needed to learn from some of the procedures used by the accounting firms and develop an ability to “triage” clients’ work by deciding where each ele­ment should be undertaken, while retaining quality.

“It will require a whole bunch of different skills,” Mr Allen said. “We have got to re-engineer the firm.

“It’s like any business — there are certain core pieces you do yourself, and there are certain non-core pieces you don’t — ­depending on the business case.”

DLA Piper was “mapping” its processes to determine what it needed in order to provide a “full service offering” of delivery methods to clients.

“We are going to be looking at alternative delivery models, technology — which is really key — project management skills and process skills,” Mr Allen said.

“Law firms in the future will be built differently, but ultimately will do what they are doing now — which is dealing with clients’ ­problems.”