“It’s not my grandfather’s law firm anymore,” a law firm partner recently joked to Karl Schieneman, managing director of Legal Network.
Legal Network had just helped that firm — whose identity it cannot disclose — staff a short-term project and obtain space fully equipped with computers and a high-speed modem, a capacity the firm didn’t have. It did so in a matter of days.
Until recently, Legal Network has primarily been a provider of temporary lawyers, helping law firms manage and staff short-term projects. It’s been a sorely needed service as a sluggish economy has law firms fighting to keep overhead low by keeping permanent employees at a minimum.
But now Legal Network, which was formed in 1995, is branching into a whole new area, launching a consulting practice to help firms manage their own businesses more effectively.
Schieneman believes the time is ripe for such a service as fluctuations in the economy, advances in technology and increased competition for clients have all conspired to force lawyers to think like business people. It’s a role they’re not trained for and one many are uncomfortable taking on.
“Lawyers are not taught business or management principles in law school,” said Jim Jarrell, who was just brought in to head Legal Network’s new consulting practice.
“Lawyers are generally not encouraged to develop business knowledge,” he said. “This lack of exposure has definite consequences. Law firms often miss opportunities to build and maintain their client base by failing to fully understand business processes.”
Formerly general counsel of Columbia Gas Transmission Corp., Jarrell had revamped that company’s legal department, saving it more than 12 percent in legal costs by, among other things, carefully selecting outside law firms, choosing those that operated most efficiently.
Jarrell also streamlined the company’s in-house legal department, involving his legal staff in the company’s business so that lawyers were not seen as impediments to business, but rather as active participants in the shaping and building of the business.
This is the crux of Legal Network’s consulting service: to teach lawyers that they need to understand the intricacies of their clients’ businesses. The consulting practice also will help law firms operate more efficiently, helping them maximize profits and generally operate in a way that will give them a much-needed edge in an increasingly competitive legal marketplace.
“Clients will, given the choice, choose firms that demonstrate an understanding of business,” said Schieneman, 37, a University of Pittsburgh Law School graduate who also holds a master’s degree in industrial relations from Carnegie Mellon University.
As consultants, Legal Network won’t be just foisting a business model on law firms but will be working within a law firm’s corporate culture.
“A distinguishing feature of our consulting division,” Schieneman said, “will be to offer focused and specific advice for regional clients as opposed to leveraging similar solutions to a large number of customers.”
Even when its business primarily was legal staffing, Legal Network enjoyed a first-rate reputation in the Pittsburgh legal community, representing 23 of the city’s top 25 law firms.
“Legal Network has a very innovative approach to the problem of obtaining lawyers for particular projects,” said Fred Egler Jr. , president of the Allegheny County Bar Association, which has endorsed Legal Network as a provider of temporary legal help.
“They understand economics,” he said, “and the difference between throwing large numbers of people at a project as opposed to structuring a project in a way that benefits the client and the lawyers.”
Even before it formally launched its consulting practice, Legal Network had already begun advising law firms on economic matters. Among other things, Legal Network developed software known as StaffRite, a program that enables law firms to measure the economics of using temporary workers vs. hiring additional permanent staff.
“It ties into my CMU geek-side that has been a bit undernourished,” Schieneman jokes.
Legal Network knows how to manage its own business: It’s been ranked No. 204 on the Inc. 500, a list of fast-growing companies compiled by Inc. magazine that ranks firms that are “notable as exemplars of financial fitness in a fitful economy.”
While many companies are laying off personnel or filing for bankruptcy, Legal Network is thriving.
“If we closed our doors today,” Schieneman jokes, “we’d still have had our best year ever.”