Legal departments are markedly shifting legal work away from Am Law 100 and Am Law Second Hundred firms towards more cost-effective alternatives. This trend is not new. It began during the financial crisis of 2007-2008. Still, the relative increase in transactional work over the past decade partly concealed its extent. With M&A activity experiencing a sharp decrease over the last two years, this trend is now fully coming to light.
The shift in market power from law firms to clients denotes a significant transition from a sellers’ to a buyers’ market for legal services. This transformation is the key finding of a recent legal market report by Thomson Reuters and the Center on Ethics and the Legal Profession at Georgetown Law. The report suggests a potential ‘false sense of security’ within big law firms despite their clients’ steady departure for midsized firms.
Amid this ongoing market shift, it is becoming increasingly clear that large law firms need to pay closer attention to client preferences and reassess their service offerings and pricing structures. By doing so, they might just be able to leverage their robust experience and resources to retain their clients and remain competitive in this changing market.
Further details on this development can be found in the intriguing discussion on the topic at Law.com.