Kentucky Fried Lawyers, Anyone?

The magic of a franchise system is that someone brilliant develops a business system and then documents every step that must be taken to permit someone less capable to follow the system and replicate the results. So, wherever you go in North America, someone much less accomplished than Colonel Sanders can sell you a bucket of chicken that is just as tasty and unhealthy as the original.

Some law firms that I know of have developed great systems and processes for completing legal work. Much of the work to establish these systems was done back when firms were less obsessed with short-term profits and lawyers and staff members made the time to work on their business instead of in their business. These same lawyers and staff members insisted that everyone comply with these rules, which was great. However, they often did not explain to the newcomers why it was important that they do so or teach them all of the nuances of the systems, which is not so great.

If a law firm were a franchised business, all of these business processes would be found in a manual, and that manual would be updated every time an improvement in the system was developed. Every lawyer would run their practice strictly in accordance with the manual or they would be fired.

However, law firms tend not be run like other businesses.  So instead of the rules and the justifications for them being in a manual, many of them reside in the minds of senior lawyers and staff members.

So here is what is going to happen to these law firms. The lawyers and staff who developed the systems are going to eventually leave, retire or die. The institutional knowledge about the processes will be lost with them.

For example, consider something as simple as putting together a share structure for a corporation. The forms and systems have been developed and the senior clerk knows them inside and out. The lawyers rely on the senior clerk to know how to use the system and to supervise the junior clerks. The lawyers are busy, so they don’t bother checking things. Besides, some of them never had to do it themselves, so they don’t really know what to look for.

All of this works just fine until the senior clerk is not there anymore. The junior clerks do not understand the system in the depth that the senior clerk did. When the processes seem inconvenient, they just work around them. Eventually mistakes are made. Clients are lost. Claims are reported.

This type of thing happens when you work in your business to maximize short-term results instead of working on it to maximize long term results.

Perhaps I am wrong and law firms will invest in documenting their business processes at the expense of short-term profits so that as personnel leave, their replacements will have the benefit of all of their institutional knowledge. I think not, but then again, I can be a bit negative in my outlook based on nothing more than forty years of observing how lawyers operate.