The low bar set by an insular, self-satisfied profession.
The legal profession is stymied by an innovation crisis. We lack the bold ideas, new models, and financial commitments necessary to address our acute dilemmas and deficiencies in law firm efficiency, client satisfaction, legal education, law student indebtedness, racial injustice, lack of diversity in law firms and courtrooms, attorneys’ mental health, access to justice, gender bias, legal services delivery systems, sentencing disparities, civil justice expense and delays, bail reform, and mass incarceration. Each of these problems requires a level of innovation that has evaded the legal profession for decades.
In this post, I hope to accelerate our understanding of legal innovation by discussing these five questions:
- Where do attorney innovators come from?
- Are law firms innovative?
- What does innovation look like?
- What is not innovation?
- Why don’t we innovate?
As discussed below, the legal profession suffers from a paucity of innovators, a tendency to package minor changes as major innovations, confusion about the origins and elements of innovation, and cultural and personal traits that inhibit or outright quash innovation. To become innovators, we have to look at successful, innovative organizations and adopt their philosophy that innovation is everyone’s responsibility and should permeate every decision about people, processes, policies, and priorities.
1. Where do attorney innovators come from?
While the current technological revolution is transforming nearly every aspect of social interactions and business practices, only one percent of undergraduates cite “ability to work with or develop cutting edge technology” as a factor in considering a law degree. Only three percent of undergraduates consider “opportunities to be original and creative/innovative” as a reason to consider law school. See Association of American Law Schools, Beyond the Bachelor’s: Undergraduate perspectives on graduate and professional degrees at 42 (2018). No other graduate or professional school has been this successful in persuading candidates that their interests in technology, innovation, and creativity are unwelcome and likely to be thwarted.
The perception that the legal profession is hostile to technological advancements and innovative thinking has discouraged generations of inventive undergraduates from applying to law school. If a tiny percentage of inventive undergraduates sets aside their apprehensions and applies to law school, believing that opportunities for new technology and innovation might exist in law, the law school admissions process often imposes another barrier to entry. Inventive students present profiles that may not match conventional law school admissions criteria, and it is difficult to find a law school that expressly considers innovation, creativity, and technological proficiency among the factors secondary in importance after LSAT scores and undergraduate GPAs.
Given undergraduates’ general perception that the legal profession does not provide opportunities for technological advances and novel thinking, and law school admission practices that emphasize conventional achievements and skills, law firms and legal departments hiring attorneys are left with a tiny pool of potential innovators. And they may not be interested in hiring potential innovators anyway. Legal employers generally place a low priority on technology and innovation, as indicated by the Institute for the Advancement of the American Legal System’s (IAALS) survey of 24,000 lawyers: “Three of the four Technology and Innovation foundations were classified as necessary in the short term by one-quarter or less of respondents.” IAALS, Foundations for practice: The whole lawyer and the character quotient, at 24 (2016).
Consistent with the profession’s depreciation of innovation, Harvard Law School’s Office of Public Interest Advising has identified 90 likely interview questions, and only one question specifically addresses creativity. No specific reference to innovation or technology appears in the other 89 questions. While innovative companies are asking job candidates, “Tell me about a time when you invented something,” many law firms are still asking them, “Tell me about a complex legal issue you worked on.”
If an aspiring innovator survives the law school admissions and law firm recruiting processes, she will find it difficult to innovate as an associate attorney. In the initial years of practice, as Scott Westfahl, Director of Harvard Law School Executive Education, notes, attorneys are confronted with the harsh reality that “they need to focus most of their attention on building technical legal skills because they did not learn them in law school.” Westfahl, “Learning to lead: perspective on bridging the lawyer leadership gap,” in Leadership for Lawyers, at 80 (Gardner & Normand-Hochman, eds. 2019). They are at “a significant disadvantage,” Westfahl states, because the need to acquire core technical skills “crowds out” the development of other professional skills. “It’s hard to catch up,” he adds, “especially when you do not know what you do not know.”
In that sense, legal education stifles innovation because it does not provide the threshold skills necessary for the practice of law. When only three percent of surveyed students cite “practical skills” as the most important skill developed in law school, we can’t expect new attorneys to innovate; they are struggling to meet basic performance requirements. See Gallup & AccessLex Institute, Examining Value, Measuring Engagement at 14 (2018). Since law schools are not preoccupied with teaching technical skills, we might expect that they are developing a few students’ innovation and creativity skills. But Gallup reports that “0%” of students identify “creativity” as the most important skill developed in law school. Id. at 14.
As attorneys advance from associate to partner, they learn that law firm incentive structures do not emphasize innovation, creativity, and technological advances. In fact, those factors do not appear on surveys identifying the key factors in partner compensation. See Major, Lindsey & Africa. Partner Compensation Survey at 40 (2018). When asked to identify qualitative and quantitative factors that should be given greater weight in partner compensation, partners do not mention innovation, creativity, or technological advances. Id. (reporting changes partners would like to see in their compensation systems). A lack of creativity, innovation, or technological proficiency, moreover, is not cited by partners as a barrier to making partner. Id. at p. 48.
2. Are law firms innovative?
Since the legal profession does not seem to attract, promote or retain many innovators, it has to magnify the relatively few innovations it produces and characterize modest changes as innovations.
Stephen Poor, Chair Emeritus of Seyfarth Shaw, advises, “Never underestimate the resistance to change from lawyers. Even more likely, never underestimate the ability of lawyers to describe virtual status quo efforts as revolutionary change.” J. Stephen Poor, “Re-Engineering the Business of Law,” New York Times, May 7, 2020.
Poor’s concerns about this tendency to package nominal changes as innovation sensations are amplified by Mary Shen O’Carroll, the director of Google’s legal operations. O’Carroll sees law firms as making “small incremental changes in the face of big disruptive changes.” While clients “are demanding efficient, new legal service delivery models,” she explains, their outside counsel “is largely offering symbolic, superficial innovation.” Victoria Hudges, “Google’s Mary Shen O’Carroll: Some firms don’t realize they can be replaced,” American Lawyer, Feb. 28, 2020. Many law firms, in short, may be confusing minor changes and improvements with innovation. They set the bar too low and congratulate themselves on hurdling it too quickly.
The consequences of law firms’ low expectations and high self-satisfaction are disturbing and suggest that most firms are unprepared to meet clients’ demands and expectations. The 2020 Wolters Kluwer Future Ready Lawyer Survey is revealing:
- 76% of lawyers believe their law firms or legal departments will be impacted by “the increasing importance of legal technology.” But only 28% think their organizations are very prepared to address it.
- 73% of lawyers acknowledge a growing demand for “improved efficiency/ productivity.” But only 28% believe they are very prepared to meet this demand.
- 71% of legal departments report that, in choosing a law firm, “uses technology to deliver the best service possible” is an important attribute. But only 29% report that this attribute describes their current firms very well.
Examining ten major trends that will have the greatest impact on law firms and legal departments over the next three years, the Wolters Kluwer survey concludes, “there is an alarming gap between overall market trends and readiness to address them. Fewer than one-third of respondents report their organization is very prepared to address any of these issues.” Wolters Kluwer at 6.
When asked to describe their law firms’ progress in “improving the efficiency of delivering legal services,” most law firms report “no real action,” “ad hoc efforts,” or “still working on a plan.” Altman Weil, Law Firms in Transition 2020 at 37. Seventy percent of law firm leaders cite “partners resist most change efforts” as the leading reason they are not changing their legal services delivery model. The percentage of law firm leaders citing “partners resist most change efforts” has increased steadily during the last six years, from 44% in 2015 to 70% in 2020. Id. at 13.
Similarly, BTI Consulting Group’s recent survey indicates that law firms’ innovation efforts are decreasing: “Fewer law firms are showing clients innovation around improving the client experience – top legal decision-makers point to 14.6% fewer firms than last year.” BTI Consulting Group, “Fewer Firms Improving the Client Experience,” The Mad Clientist, May 22, 2019.
3. What does innovation look like? (CUGS)
Innovation is associated with creativity, originality, uniqueness, and singularity. The distinguishing feature of innovation, in popular depictions, is novelty, but innovations do not move from conception to large-scale adoption unless novelty is accompanied by usability, gratification, and survivability.
Sustainable innovations are not only novel concepts; they also must be practical, desirable, and durable. Tesla automobiles, for instance, satisfy multiple objective and subjective needs of their owners apart from their competitive advantages in battery technology.
To present a concrete model of what constitutes innovation, and to assist law firms and departments in identifying genuine innovation, I have identified some key elements (concept, usability, gratification, and survivability) in the table below. As the table indicates, innovation is not incremental or derivative change but usually requires novel concepts, exceptional usability, memorable gratification, and long-term survivability.
CUGS (Concept, Usability, Gratification, Survivability) Innovation Model
|Originality (creativity, novelty, singularity, distinctiveness, imaginativeness)||User-centric (ease, speed, confidence, comfort)||Sensation (pleasure, security, enjoyment, health)||Practicality (durability, reliability, results-orientation)|
|Boldness (scope, vision, transformativeness, comprehensiveness)||Effectiveness (functional, advantageous, superior, utilitarian)||Acceptance (likeness, affiliation, conformity, tribalism)||Accessibility (affordability, availability, controllability, manipulability)|
|Divergence (fluency, flexibility, associativeness)||Replicability (scalability, modularity, adaptiveness, multiplicity)||Signal (identity, affluence, prestige, symbolism, status, egotism, position)||Transparency (demonstrable, measurable, provable)|
|Integration (multi-disciplinary, centripetal, exhaustive, inclusive)||Non-iatrogenic (safe, innocuous, undamaging, benignness)|
|Elegance (simplicity, clarity, vividness, incisiveness, precision)||Stickiness (concrete, credible, endearing)|
|Source: Randall Kiser, DecisionSet|
We can pose the following questions relative to each element of innovation to determine whether an idea, service, or product is innovative or merely an incremental or derivative change,
- Originality. Is it original – creative, different, imaginative, novel, and distinct?
- Boldness. Is it bold – does it identify and solve a major problem, reflect a comprehensive understanding of the problem, and address all of the problem’s dimensions? Does it take on what Jim Collins calls a “Big Hairy Audacious Goal (BHAG)”?
- Divergence. Does it reflect divergent thinking – fluency (volume of responses), flexibility (ideas that differ from each other), and associativeness (the capacity to see connections between seemingly unrelated thoughts and items). See Mihaly Csikszentmihalyi, Creativity at 368-370 (1996).
- Integration. Does it integrate research, theories, observations, and ideas from all possibly relevant domains and all possibly helpful authorities and affected parties? Does it display centripetal (unifying) thinking?
- Elegance. Is it clear, vivid, simple, incisive, and complete – or as Einstein said, “as simple as possible but not simpler”? Cf. Post 125 (using Einstein quote to describe Delta Model).
- User-centric. Is it designed for users’ benefit, ease, comfort, and productivity and easily implemented by them?
- Effectiveness. Is it easily testable, does it fully comprehend users’ purposes, can it consistently meet users’ requirements, and is it superior to other services and products?
- Replicability. Is it easily and economically replicable, scalable, or modifiable in multiple contexts where it could be useful?
- Sensation. Do users enjoy or perceive a benefit in using, implementing, and being identified with it? Do users derive utilitarian, emotional, and symbolic gratification from using it?
- Acceptance. Does it facilitate or expedite users’ acceptance by peers or other persons or groups important to users? Does it enhance users’ affiliation with a person or organization and assure that person or organization that they share common goals, beliefs, and preferences?
- Signal. Does it have symbolic value and contribute to users’ self-construction and self-verification? Does it harmonize with users’ projection of their status, affluence, prestige, and position?
- Practicality. Is it durable and reliable, and does it consistently provide the results users wants and only the results users desire?
- Accessibility. Do users perceive it to be accessible – affordable, available on user’s timetables, controllable, and manipulable?
- Transparency. Are the benefits demonstrable – clearly evident or provable to users, stakeholders, critics, and opinion-makers?
- Non-iatrogenic. Will it deliver its benefits without causing observable or latent harm to users, their organizations, and society?
- Stickiness. Is it sticky – simple, unexpected, concrete, credible, emotional, and driven by stories? Chip Heath & Dan Heath, Made to Stick (2007).
As you consider these elements of innovation and the questions that flesh them out, how many recent changes in law firms, legal departments, law schools, and civil and criminal justice systems come to mind? How many of those recent changes display more than half of the elements of genuine innovation? How many attorneys, judges, policy analysts, court administrators, and law professors come to mind as innovators?
4. What is not innovation?
We can advance our efforts to become innovators by candidly acknowledging that much of what we call innovation in law is minor change or improvement, not genuine innovation.
To become innovators, we need to dramatically expand our objectives, assume broader responsibilities, and redefine our capabilities. We can start this process with cautionary advice from Eric Schmidt, the former CEO of Google:
If your customers are asking for it, you are not being innovative when you give them what they want; you are just being responsive. That’s a good thing, but it’s not innovative. … For something to be innovative, it needs to be new, surprising, and radically useful.
Eric Schmidt & Jonathan Rosenberg, How Google Works at183 (2016). By this measure, law firms may be making some progress toward being responsive to clients but many are not being innovative.
Even when they are upgrading technology, law firms are rarely being innovative. David Cunningham, Winston & Strawn’s Chief Information Officer, notes that other industries were collecting “near real-time information” years ago: “When you step outside of legal, you realize we have a 15-year immaturity gap.” Describing his new system to digitally share diversity data between clients and law firms, he states, “This isn’t really innovation. It is trying to catch up with other industries for both law firms and legal departments.” Roy Strom, “Clients Track Diversity But Law Firms Miss the Message,” Bloomberg Law, Feb. 27, 2020.
When asked to identify their recent innovations, many firms point to pricing. But outside of law, pricing improvements are by-products of innovation and are not considered stand-alone innovations. Innovations disrupt pricing structures because they typically lower costs, improve quality, and increase choices by changing systems, methods, materials, products, and technologies. The innovation dog wags the pricing tail, and if the pricing tail is trying to revive the innovation dog, it might be sick.
When an industry’s innovation efforts are focused on pricing, as has occurred in the U.S. airline industry, it frequently signals that innovation has stalled. Pricing, specifically “dynamic pricing,” gets a lot of attention in U.S. airlines because very little has changed in that industry other than the number and size of seats being squeezed into a fuselage. If pricing has become the most innovative enterprise at law firms, we are abandoning our larger responsibilities to clients, courts, society, and the latest generation of attorneys—44% of whom attended law school to “help others/contribute to society.” Gallup & AccessLex Institute, Examining Value, Measuring Engagement at 10 (2018).
5. Why don’t we innovate?
The persistent lack of legal innovation results from multiple shortcomings in how students are selected for admission to law schools; how law schools educate students; how law firms and legal departments recruit and select candidates; and how law firms and legal departments orient, develop, animate, and compensate attorneys. The lack of innovation is rooted in a fundamental, albeit flawed, concept of what an attorney is, what attorneys are accountable for, and what constitutes achievement in the legal profession.
Correcting our mistakes, deficiencies, oversights, and misconceptions – if this occurs at all – will take many years. But in the meantime, we can identify some of the attitudes and practices that impede innovation and start to overcome them now. To facilitate this process, I outline four impediments below. Since they are largely attitudinal and philosophical, they are amenable to rapid adjustments given a motivation to innovate.
Legal analysis is precedent-based, and this perspective gives attorneys the false confidence to drive forward while focused on the rear-view mirror. Retrospective thinking that would cause severe accidents in other professions and occupations is often seen as prudential when displayed by attorneys. Although innovative thinking is perforce forward-looking, conventional legal thinking is backward-looking, continually searching for direction from old statutes, cases, and authorities that already have proven to be unhelpful in deterring malevolent behavior or resolving a conflict.
Judge Richard Posner describes the dangers of precedent-based thinking: “Instead of the judge’s asking: here is a novel issue – how should it be resolved? – he asks: here is a novel issue – what resolution is dictated by existing legal materials, the product of decisions … made in the past, often long in the past? … It’s saying: let the past control the present and the future, or as Nietzsche put it sarcastically, ‘Let the dead bury the living.’” Richard Posner, Divergent Paths, at 76-77 (2016).
Large law firms are fixated on extrinsic motivation. They compete fiercely with each other – the “nuclear weapons club,” as consultant Bruce MacEwen describes it – to set higher levels of attorney compensation and new records for profits per partner (PPP). The American Lawyer’s annual announcement of law firm rankings by PPP, gross revenue per partner, and revenue per lawyer may be the gaudiest celebration of extrinsic motivation by any profession.
Unfortunately, extrinsic motivation and innovation don’t mix well. Research consistently confirms that extrinsic motivation (typically income, bonuses, tangible incentives, and visible status) is antithetical to innovation, while intrinsic motivation (an independent drive to fulfill a purpose and achieve a goal set for its own value or interest) promotes innovation.
For extrinsically motivated people, work is instrumental and “must lead to something else.” For intrinsically motivated people, work “is inherently interesting and challenging.” Randall Kiser, Soft Skills For The Effective Lawyer at 64 (2017). As innovator/entrepreneur Mark Ruiz explains, “even though I’m an entrepreneur, what drives me is not really the money. What really drives me is a deep sense of mission and purpose.” Jeff Dyer, Hal Gregersen, & Clayton Christensen. The Innovator’s DNA at 238 (2011).
In his incisive study of the American automobile industry’s decline and the ascent of Japanese automobile manufacturers, David Halberstam focuses on the legendary innovator W. Edwards Deming. Scorned by American automobile companies, Deming emerged as the key innovator in quality control systems for Japanese manufacturers. “He was for most of his career virtually unknown in America,” Halberstam writes, “a prophet without honor in his own land, but he was one of the most important figures of the second industrial revolution, that is, the challenge of East Asia to the West.” David Halberstam, The Reckoning at 312 (1986).
Like other effective innovators, Deming was immune to extrinsic motivation and was fueled by intrinsic motivation: “Deming’s passion was for making better products, or more accurately for creating a system that could make better products. It was not for making money. He clearly had little interest in material things. … The Japanese who trekked to see him were aware that he could have profited immensely in those days, selling himself and his services to Japanese companies. The subject just never seemed to come up.” (Halberstam, p. 312).
Who is the W. Edwards Deming of the legal profession?
Artificially low innovation in low-margin markets
In his seminal book, The Innovator’s Dilemma, the late Clayton Christensen explained how large, successful companies “were getting blindsided by newcomers offering products or services that may not have been as good, but were simpler, more convenient, and more affordable.” Warren Berger, A More Beautiful Question at 136 (2016). Breakthrough innovation, Christensen discovered, “was at the low end of the market.” But the large companies would not change their business model to make their products more affordable and accessible. They walked away from the opportunity to control the mass market because they preferred selling high-margin products to high-end customers rather than low-margin products to a mass market.
In the legal services industry, unlike the markets Christensen studied, there is no threat of innovation from low-end markets. The innovations that normally occur in the low end of a market do not exist in legal services because the small firms and solo practitioners serving this segment are barely surviving and frequently lack business and time management skills. See Clio, Legal Trends Report for 2017, 2018, and 2019. The economic asphyxiation of small firms and solo practitioners ensures that large law firms will continue to deliver high-margin services to high-end clients without facing competitive threats usually posed by low-end market innovation. Although large law firms have the resources to develop innovative products and services for the low-end market, the segment Bill Henderson calls “PeopleLaw,” they have little or no interest in that market. See Legal Market Landscape Report (State Bar of California 2018).
Large law firms could serve the middle and low-end markets and generate innovation by establishing and funding separate law firms (think Lexus/Toyota, Marriott Ritz Carlton/Marriott Fairfield Inn, Nordstrom/Nordstrom Rack), but this is an unlikely reputational risk. Until large law firms are required to provide legal services to low-income citizens in proportion to a law firm’s share of the U.S. legal market, consistent with their exclusive franchise rights and responsibilities, we will not see the innovations that normally emerge from low-end markets. The bifurcation of the U.S. legal market into the perennially overserved Organizational Clients and the chronically underserved PeopleLaw is an unacceptable externality in the U.S. economy, and it should be corrected by the actors who have benefited from the immensely profitable franchise enforced by state bar associations. See Daedelus, Winter 2019 (Access to Justice issue).
If large law firms become responsible for serving low-income markets in the same proportion as their market share, the scope, quality, and rapidity of innovation in low-end markets might be astonishing. This innovation, in turn, would generate competitive pressures that, Christensen confirmed, normally exist in competitive, non-franchise markets.
Legal innovator traits
In their extensive, eight-year study of major innovators, The Innovator’s DNA (2011), Jeff Dyer, Hal Gregersen, and Clayton Christensen identified five essential innovator traits:
- Associating. Innovators connect “wildly different ideas, objects, services, technologies, and disciplines to dish up new and unusual innovations.” They understand how seemingly unrelated things could have something to do with each other, and they recombine the ideas they collect in new ways, “allowing them to offer something new to the market.”
- Questioning. “Innovators treat the world as a question mark, rarely working on autopilot and constantly challenging the accuracy of their mental maps about the territory (whether products, services, processes, geographies, or business models).”
- Observing. Innovators observe how things work and are sensitized to what doesn’t work; they actively observe customers to understand how they work with products; they constantly look for surprises and anomalies; and they regularly visit new environments to discover what they are missing and have overlooked.
- Networking. Innovators do not network for resources or career progression, and they do not target people who are like them or people with power, positions, and influence. Instead, they network to expose themselves to new information and ideas, and they target “people who are not like them” and “experts and nonexperts with very different backgrounds and perspectives.”
- Experimenting. Innovators try new experiences; deconstruct and take products and processes apart; and test ideas with prototypes and pilot programs.
When we look at the current leaders in legal innovation, it’s not clear that their chromosomes form what Dyer, Gregersen, and Christensen call “the innovator’s DNA.”
Although we cannot be sure that legal innovators need to have the same personal traits and behaviors as the innovators in Dyer’s study, we should consider whether legal innovators would benefit from a re-configured skill set and a more ambitious vision. Legal innovators tend to be independent, conscientious, receptive to change, and willing to challenge conventional ideas and practices, but some may be excessively cautious, setting their expectations too low for the sake of achieving small wins. Some legal innovators, in addition, may have difficulties understanding how others interact with providers and services, and they may be ineffective in describing and convincing decision-makers of an innovation’s advantages and the speed at which technologies should be adopted.
Ten years from now we may conclude that some of the thought leaders we regard as innovators today were actually antecedents to innovation.
If we can be realistic with ourselves, we will recognize that the legal profession has not fulfilled all of its responsibilities as the exclusive provider of legal services in the United States.
Since we have been the exclusive providers for about 100 years, we have to accept responsibility for a legal system that is inaccessible to middle and low-income citizens, scores below many other industrialized countries in citizens’ trust and confidence, encounters difficulties in consistently satisfying its affluent clients, and resists pressures to change its business models. We cannot blame others for our shortcomings since we have controlled the practice of law through state bar organizations and have generally opposed reforms that would allow non-attorneys to provide some legal services and own interests in law firms. See, e.g., Sam Skolnik, “California Bar Swamped by Comments Opposing Ethics Rule Changes.” Bloomberg Law, Aug. 6, 2019.
Our fixation on control of legal services rather than responsibility for legal services has many repercussions, some detrimental to innovation specifically and others harmful to society generally. Small wonder then that most attorneys in the Millennial generation believe that “the law firm business model is fundamentally broken” and “partnership is much less desirable than it was a generation ago.” Major, Lindsey & Africa, 2019 Millennial Attorney Survey at 26-28. Innovation is the counter-weight to this new, powerful wave of Millennial attorneys’ distrust, skepticism, and disappointment. We can win back the confidence of attorneys, clients, and the public by demonstrating a commitment to innovation and showing that, as Dyer urges, “innovation is everyone’s job.”