Law Professor: Lack of Business Sense Dooms Many Firms

Posted on June 18, 2015 by Dan Christensen

A law professor returned to the San Francisco area where he had once practiced law 20 years earlier. He was shocked to find that only one-third of all the law firms he had known were still around, and he couldn’t help but wonder why.

The dot-com boom and bust had happened during his 20 year absence, so the public wasn’t too surprised by the sinking law firms, but many of the firms that went down were the biggest and most skilled. That fact was highly disturbing for anybody who actually worked as a lawyer in San Francisco at the time. So what happened?

Debt, profit share disputes, unnecessary geographic expansion, and unsustainable employment promises usually brought down these titans of the legal industry. This actually proved the professor’s theory that what really brought these firms down was not bad lawyering, but a lack of business know-how.

“The busted law firms boasted people with excellent pedigrees,” the professor said.” To be the best lawyer, or the best collection of lawyers, is not enough… It is necessary to be great businesspeople, too.”

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Source: http://www.huffingtonpost.com/frank-h-wu/why-law-firms-fail_b_6827410.html



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