Yes! so how can law firms maintain a competitive advantage in an uncertain economic climate...
For these kinds of questions, it helps to put yourself in the position of a law firm. If there's an uncertain economic climate, you can imagine that your clients may be more cautious about expanding or investing. You may need to take on more of an advisory role as clients become more interested in how certain events will impact their business.
Consider how you can add value to clients in an uncertain environment. If your clients are concerned about the impact of Brexit, a potential trade war or, upcoming European data protection laws, you should be proactive. Perhaps you invest in research, set up specialist teams or offer clients exclusive access to your market research.
Difficult economic conditions place a downward pressure on fees and encourages companies to shop between law firms. You need to think about how you can continue to win business and retain existing clients. Do you offshore work or invest in technology so you can deliver services at a lower cost? Should you focus on cultivating key client relationships through networking events and client meetings? Should you just quote a lower price or a fixed fee arrangement in your pitch?
Then you want to consider how you're managing your law firm. If the economic climate is uncertain and clients are less active, you should consider your business model. You could take a defensive stance by investing in countercyclical practice areas, reducing hires and partner promotions, and focus on retaining employees. Lower costs mean you can stay profitable at times when other law firms are struggling.
Or you could play the long game. You could expand internationally - through mergers or opening up offices - to hedge against a slowdown in certain economies. You could use debt to fund your activities in the hope that once the economy picks up, profits will rise sharply.
