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Technology is key to delivering innovative legal services, says Appleby chair

Offshore law firm will be aligning KM with technology to give clients greater value

20 July 2015

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By Manju Manglani, Editor (@ManjuManglani)

Offshore law firm Appleby is selling its fiduciary business for an undisclosed sum to focus on legal services.

The management buyout (MBO), which is backed by private equity firm Bridgepoint, forms part of a strategic focus on providing clients greater value, according to global chair Francis Woo

"Clients are requiring a much greater alignment between the delivery of value and their strategy and a lot of the law firms on the onshore side have started to adapt," she told Managing Partner.

"Things are happening so rapidly that we really need to better align ourselves with client needs."

Changes in client demands have resulted in the firm taking a fresh look at its market offering and how it can deliver innovative services.

"And that means delivering value through the use of both knowledge management and technology, looking at other ways and means in which we can work with clients, and then really looking at the delivery of products and the differences between more bespoke products versus more commoditised areas," she said.

"I think there does need to be a much tighter relationship between KM and technology, without disclosing to you exactly what those plans are - I think those will need to be in development."

Citing how Uber has changed the way that people around the world travel, Woo suggested that law firms will also need to use technology to drive change in the legal market.

She confirmed that, as part of Appleby's new business strategy, it is considering setting up a new business unit for commoditised legal work.

"That's certainly a possibility that we've been exploring for some time and I think we can take examples from the onshore legal world," she said.

"I think a lot of clients are viewing legal services in a very tiered approach in that they can identify and differentiate which aspects they require that are more bespoke services, as opposed to more commoditised work, so equally we need to adapt ourselves to that."

Appleby will also be looking at new areas in which it can partner with clients to ensure compliance with evolving regulatory developments.

"So that involves a lot of investment by the law firm in order to ramp ourselves up," she commented.

"Historically, law firms have been very traditional and more conservative and slow to adapt. But I think that, going forward, they really do need to operate more like businesses, like a lot of the management consulting firms, like the Big Four accounting firms, in terms of adapting to what clients want, as opposed to keeping operating in the manner that they have been."

In June 2015, offshore firm Ogier announced a new brand identity in line with its new focus on the law following the management buy-out of its fiduciary services decision in 2014.

Asked if the Appleby's decision to sell its fiduciary business was, in part, influenced by Ogier's actions, Woo said: "Not entirely, but I think that was a factor in it."

"I think when we surveyed the market, certainly Ogier was in the fray, as was the example by Walkers, but equally, I think more importantly, it was the consolidation that was happening in the fiduciary business side by a lot of the global players, their movements and the resources they had at their disposal to invest in that market."

In May 2015, Walkers announced that it would be relaunching its fiduciary business after selling it to Intertrust in mid-2012 to focus on the law. The offshore firm said the new business was needed to meet "consistent client demand" for registered office, corporate and company secretarial services.

Woo believes the sale of Appleby's fiduciary business (for an undisclosed sum) will enable both sides of the business to receive the level of investment they need to remain competitive.

"We continued to want the law firm side to be very strong and to keep pace with legal developments, which would require investment, and equally we saw how quickly the fiduciary side was developing and how that that would require further investment," she said.

"So we felt the time was right for us - otherwise, at some point, the gulf would start to become so wide for us on the fiduciary side that we would start to lose we felt our leadership position and competitive advantage."

The hope is that both sides of the business will be able to grow without hampering each other.

"The MBO and the PE backing will really allow the fiduciary side of the business to flourish and to maximise their strategy going full tilt without being hampered by the law firm side," she said.

On the law firm side, there will be significant reinvestment by the partners and owners of the business.

"That will allow them to go full tilt in terms of addressing the competitive demands to ensure that not only do we remain competitive but that we are at forefront of that," said Woo.

Appleby's group managing partner, Michael O'Connell, will continue to lead the law firm post-completion.

Farah Ballands, partner and global group head of fiduciary, will become chief executive of the independent fiduciary business.

 

 

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