Every legal innovatorearly adopter and change agent shares a common, unifying desire: To speed up the pace of innovation within their organization.

This statement is true whether the context is a law firm, legal department, government agency, bar association, or law school. Over the years, I have commiserated with them all. Although they don’t know it, their disappointment is rooted in the fact that organizations are much harder to influence than individuals. See foundational posts 007 and 008 (discussing complexity and challenges of successful organizational adoption). For better or worse, organizations are everywhere within the legal ecosystem. Thus, it would be extremely useful to understand what levers to pull that can make them more innovative.

Post 015 is part of Legal Evolution’s foundational series on diffusion theory.  Readers seeking to influence innovation within the legal industry will be more successful if they obtain and apply this background knowledge. Care has been taken to make this information non-technical and accessible.

Rogers Organizational Innovativeness Model

The model above, drawn from Everett Rogers’ Diffusion of Innovations Ch. 10 (5th ed. 2003), summarizes several factors that positively or negatively affect an organization’s level of innovativeness.  The model aggregates the results of numerous empirical studies that utilize multivariate regression analysis. However, just like the “rate of adoption” model discussed in Post 008, Rogers conveys the key findings using words rather than numbers. This is because, as an applied researcher, Rogers wants his analysis to be understood and used by a smart lay audience. See Post 001 (explaining difference between applied and academic research).

To illustrate, a multivariate regression model has some number of “independent” variables that predict some outcome we care about. We call that outcome the “dependent” variable. In the graphic above, the left side lists several independent variables while the right side contains a single dependent variable.  Thus, it can be said that the level of organizational innovativeness depends upon the values of several specific independent variables. In very practical terms, the model tells us what categories of change we should focus on to increase innovativeness within our organizations. And, by implication, it tells us what not to do.  It is very hard to overstate how useful this is. In the early days of any innovation, Rogers’ models (above and in Post 008) are both map and compass. It is just plain foolish not to learn how to use them.

That said, to have a fair chance of success, readers need additional background knowledge on the challenges of organizational innovativeness.  Thus, I am breaking this topic into three parts. Part I (Post 015) reviews the reasons why organizations tend to become bottlenecks for innovations that are crucial to their long-term survival. Part II (Post 016) discusses a very counterintuitive fact — that organizational innovativeness is strongly correlated with size, even in law firms. With this background information in place, Part III (Post 017) dives into the details of Rogers’ innovativeness model (above) with special emphasis on how it applies to legal service organizations.

Brief Review of Diffusion Theory

Innovators and early adopters are very interested in speeding up the rate of adoption of innovations. Everett Rogers’ rate of adoption model in Post 008 sets forth many factors that positively or negatively influence this outcome. The model groups these factors into five distinct categories: (I) Perceived Attributes of Innovation, (II) Type of Innovation-Decision, (III) Quantity and Quality of Communication Channels, (IV) Nature of Social System, and (V) Efforts of Change Agents.

As noted in earlier foundational posts, the first category, “Perceived Attributes of Innovation,” contains the most biggest levers for change. This is because the five attributes identified in the research — higher relative advantage, lower complexity, greater compatibility, use of pilot trials, and increased observability for prospective adopters — explain the majority of variation in rate adoption.  With sufficient quantities of time, money and effort, innovators, early adopters and change agents can alter these factors in the right direction. See Post 008 (urging those favoring innovation to “focus your attention on these five factors”); Post 011 (explaining “slow innovations” based solely on these five factors).

Yet, for those of us working in the legal industry, “Type of Innovation-Decision” is equally important. This is because Type of Innovation-Decision is essentially distinguishing between individual and organizational adopters. And the latter are (a) much more common and economically influential within the legal industry, and (b) more likely to result in adoption failure, particularly in the absence of significant planning and intervention.

Innovation in Organizations

As noted in Post 008, there are three types of innovation adoption decisions: (1) optional, (2) collective, (3) authority.  If the adoption decision is optional, it’s akin to market forces: individuals are free to take it or leave it (think Smartphone, Uber, or wearables). In contrast, when an organization is the adopter, either collective or authority adoption decisions apply.

Collective is the most problematic decision type, as a collective adoption decision requires some level of group consensus (think law firm partnership or law school faculty).  Authority adoption decisions are, in theory, easier because a single authority can decide (think CEO or GC). But successful implementation still depends upon overcoming the opposition of the laggards and late majority. See Post 007 (defining adopter types).  Indeed, “massive passive resistance” (MPR) awaits the executive who underinvests in team buy-in. See Post 008 (defining MPR and discussing its pervasiveness in corporate legal departments).

In summary, if you work in the legal industry and want to bring about beneficial change, your success largely depends upon your ability to work with, or within, organizations.  This is because good ideas, unsheltered by a well-informed sponsor, are no match for the strong anti-change headwinds created by organizational decision making. This is a structural feature of the industry that consistently impedes organizational innovation, albeit innovation is never foreclosed — not unless you and others give up. For this ultramarathon journey, Rogers’ models are essential survival tools.

That said, an important caveat is in order.  The predictive power of Rogers’ organizational innovativeness model is much lower than the Post 008 rate of adoption model.  One of the main reasons for the lower predictive power is that factors that make an organization more likely to innovate are simultaneously factors that tend to undermine successful implementation.  Specifically, the likelihood of an organization deciding to adopt an innovation is positively correlated with (i) lower centralization of authority, (ii) higher complexity of work, and (iii) less formalization of procedures. Yet, these three attributes are negatively correlated with successful implementation.

Obviously, very few organizations have the level of self-awareness necessary to make appropriate mid-stream adjustments.  Instead, leaders try to power through obstacles with a one-size-fits-all management approach. In legal organizations in particular, when an innovation fails, we place the blame on lawyers’ contentious, skeptical, autonomy-loving nature. This is a bogus uninformed analysis.  Fortunately, this pathetic cycle can be broken through careful planning and leadership.

Initiation versus Implementation

Below is a graphic that summarizes the five stages of an innovation adoption process in an organization. Notice that the adoption decision is made only after a period of agenda-setting (Stage #1) and matching (Stage #2). Thereafter, the painstaking work of implementation begins.

Note also that the model above essentially assumes that the innovation process is managed by an existing bureaucracy, ostensibly just one of many managerial duties.  The process begins with “Initiation,” which consists of “all of the information gathering, conceptualization, and planning for the adoption of the innovation, leading up to the decision to adopt” (pp. 420-21). After the leadership makes the adoption decision, the organization commences the “Implementation” phase. This consists of “all the events, actions, and decisions involved in putting the innovation to use” (p. 421).  When the innovation is so integrated in the organization that it becomes routinized, it “loses its identity” as something new. In essence, the innovation has merged into the status quo.

As noted above, several organizational attributes that support successful initiation become sources of weakness during implementation. This should be very humbling to legal innovators and early adopters who likely excel at initiation but are prone to underestimate the hardships and complexities of successful implementation. This tendency is explicitly discussed in the Silicon Valley classic Crossing the Chasm by Jeffrey MooreMoore’s solution is simple: when the time comes, replace the innovator/early adopter management team with more mainstream operators whose skill set is execution rather than ideation. For the opposite situation — when an organization is very good at setting and following procedures but struggles to innovate — Rogers suggests a skunkworks as a potential solution.

Unfortunately, there is good reason to believe that law firms, the longstanding cornerstone of the legal industry, reflect the worst of both worlds. The partnership structure hinders both successful initiation and implementation, not to mention making a timely adoption decision. Cf. Bruce MacEwen, Tomorrowland: Scenarios for Law Firms Beyond the Horizon (2017) (discussing at length the business liabilities of governing a law firm as a partnership; suggesting that the partnership model will become a source of numerous law firm failures). Yet, this is less a reason for hopelessness than cause for careful study and preparation, at least among those who intend to stay in the industry beyond the short to medium-term.  Society has many hard problems. This one belongs to lawyers.

There is more to unpack in Parts II (016) and III (017), which I’ll post shortly.

What’s next? See Innovation in Organizations, Part II (016)