2017 Law Firms in Transition Survey Released

 386 US Law Firms Represented in Leading Legal Industry Survey

Newtown Square, PA, May 23, 2017 – Altman Weil’s 2017 Law Firms in Transition Survey details a legal market characterized by an endemic erosion of demand for law firm services, increasing price competition, a need for greater efficiency in service delivery, an influx of new kinds of competitors and the inexorable force of technology innovation. 

Now in its ninth year, the survey has documented trends and opinions that were once viewed with great skepticism and are now broadly accepted as the new normal for US law firms.  For the first time this year, the survey also included a series of questions on which law firm change efforts are producing significant improvements in performance and profitability.

“Law firms are slowly changing in response to market pressures,” said Altman Weil principal and survey co-author . “Progress is not linear in most firms – not every effort is an overnight success, and many firms are making only cursory investments.  But we’re starting to see that certain investments are paying off.”

Highlights from the 2017 survey include:

- Chronic under-performance: 88% of firms say they have chronically under-performing lawyers. Equity partners are not sufficiently busy in 52% of firms, and non-equity partners aren’t busy enough in 61% of firms.  Overcapacity is diluting profitability in 61% of law firms.

- The levers of profitability: Cutting office space, under-performing lawyers, excess staff, and low margin practices and offices are yielding immediate bottom-line results. Lateral acquisitions and investments in business development, while widely pursued, are less effective drivers of profitability at least in the short-term.

- Linking pricing and efficiency: Only 30% of law firms routinely link discounted, capped and alternative fees to changes in how work is staffed and delivered – displaying a critical misunderstanding of the interdependence of the elements of their business model which include scope, staffing, price, work flows, project management and margin.

- Innovative experiments: 50% of law firms report they are actively engaged in experiments to test innovative ideas and methods. These initiatives run the gamut from technology and data analytics to new business ventures, efficiency, pricing and staffing improvements, and efforts aimed directly at client engagement and retention.

- The problem of partner resistance: 65% of law firm leaders say their partners resist most change efforts, and 56% say most partners are unaware of what they might do differently.  This reluctance to change is an intractable problem in many law firms.

“Lawyers are very good at interpreting data that’s set before them, but they also need to ask: What don’t we know that might matter?” said Altman Weil principal and survey co-author Tom Clay. “Adequately educating partners about current market realities is a critical first step in achieving necessary strategic change.”

Survey Methodology
Conducted in March and April 2017, the Law Firms in Transition Survey polled Managing Partners and Chairs at 798 US law firms with 50 or more lawyers.  Completed surveys were received from 386 firms, including 50% of the 350 largest US law firms and 50% of the Am Law 200.

The complete survey report includes sections on industry trends, market demand and competition, profitability, pricing, efficiency of legal service delivery, lawyer staffing strategies, law firm growth and economic performance. 

It is available to download at: www.altmanweil.com/LFiT2017.

About Altman Weil
Founded in 1970, Altman Weil, Inc. is dedicated exclusively to the legal profession.  It provides management consulting services to law firms, law departments and legal vendors worldwide.   The firm is independently owned by its professional consultants, who have backgrounds in law, industry, finance, marketing, administration and government.   More information on Altman Weil can be found at www.altmanweil.com.

Contact Information

Survey Co-Authors:

Eric Seeger
(267) 908-9781

Tom Clay
(610) 886-2000

Download the full survey

Email this page
Email this page


Practices & Services