Playing the big business game: Innovation in the regions

New entrants, more savvy consumers, market-disrupting technology, and constantly having to adapt to the ever-changing legal landscape, with its increased regulation, is a challenge every legal business, regardless of size or geographical location, knows all too well.

Speaking at the Westminster Policy Forum on innovation in the legal services market, the chief executive of the Legal Services Board (LSB), Richard Moriarty, said innovation was key to encouraging new ways of delivering both current and fresh products and services in the legal market from new and existing legal service providers. 

‘I appreciate there may be some areas in our legal services sector where innovation is more likely to take hold, and sooner, than others,’ he added. ‘But that’s not to say all organisations can’t find some new ways of offering services.’ 

However, one practitioner’s definition of innovation does not necessarily correspond with the rest of the marketplace or the consumer. Inspiration can, though, be taken from a number of regional firms who have changed the way they practise to get clients, both old and new, through the front door.

PAYG divorce 

Fidler & Pepper’s recently launched pay-as-you-go (PAYG) divorce service is the perfect example of ?a simple yet highly effective way of enhancing customer service. In essence, the Nottinghamshire-based firm created a method of spreading the cost of a divorce claim. 

‘You pay online, with a credit card or debit card, as you want,’ explains Fidler & Pepper’s managing partner, Mark Slade. ‘You get a text reminder the day before each payment is due; a text reminder the day after it was due; and, if you haven’t paid seven days later, we’re just going to let you know: “No problem. We’re going to put your case on hold until you’re ready to start paying again”.’ 

Filder & Pepper introduced the non-confrontational approach to fees due to reforms to the civil justice system. ‘The government, in its infinite wisdom, decided to withdraw legal aid for divorce, and it meant a lot of clients in our area just couldn’t afford to get divorced,’ remarks Slade. 

‘They may be living apart for a couple of years but just couldn’t afford to tie the divorce up. [Divorce] is about £1,000, no one has got that lying around. But spreading it out over the years made it easy to do, like PayPal.’ 

Slade says the implementation of PAYG divorce was an instant success with clients: ‘It’s actually letting people come forward that may have put it off in the past, or because they just couldn’t afford it. More people are taking it up than I expected. ?If you are paying it over ten months, it’s an incentive, as there is a £100 coming out per month rather than £1,000.’  

Pingit payments

Sticking with a payment theme, Breeze & Wyles of Hertfordshire has taken advantage of Barclays’s Pingit mobile payment system for its conveyancing clients.

The firm now generates a QR (quick response) code, linked to its case management system and incorporating the file system, accounts, fee to pay, and the firm’s bank details, which is automatically embedded on a completion statement and sent by email to the client.  

‘We wanted to be strengthening innovation with our banking clients,’ explains Murray Fraser, the firm’s chief operating officer. ‘Basically, instead of the client having to go to the bank and write a cheque, they just get a phone, point it at the statement, it automatically gives them all the details and they just press pay.’  

Client take-up of the firm’s app is modest at roughly 20 per cent, the majority of whom are involved in remortgaging, yet Fraser expects ?the service will expand as more banks copy Barclays’s app.

‘People are interested, even if they don’t use it or know they don’t have Pingit,’ assures Fraser. ‘There is a definite interest in people using technology and, as the demographic of consumers changes, I think there will be more people wanting to pay by easier methods.’  

Fee calculator

Yorkshire’s largest residential conveyancing firm, Beaumont Legal, recently launched an online commercial property quote calculator to allow businesses to gain fee estimates any time, day ?or night – an option previously only available to residential customers.

‘Despite the fact that many law firms say they offer fixed fees, they still require people to call or email for a quote, rather than putting their prices online,’ says Roy Cusworth, senior partner and head of commercial law at the firm. ‘This can be especially challenging for small business owners, who want their commercial legal service to be ?the same as when they buy or sell their home, even though cases can be much more complex.’

The service was developed by one of the firm’s commercial solicitors, Andrew Darnton, who joined Beaumont having previously worked with national retailers, local businesses, and private investors. 

‘I was keen to be part of a team that challenges the way legal services are offered without compromising the traditional values and standards clients expect,’ Darnton comments. ‘The new calculator is ideal for SMEs who are looking to get an understanding of legal fees for their business without any obligation.’

‘Our success in residential conveyancing ?was always based around our innovative and transparent approach, so replicating this for our commercial platform was a logical next step,’ adds Cusworth. ‘We believe this will be a real benefit for SMEs all over the UK who can now get an estimate of their legal fee in seconds. While it’s difficult to show every cost online because of the many ways ?a commercial deal can vary, we’re trying to show potential customers as much as we can.’

Centralised compliance

Not all innovation, however, involves investment in developing fancy software, as FBC Manby Bowdler would attest. The practice implemented an internal team that collaborated across the firm to create costs savings and improvements to compliance management, for which they won LawNet’s Team of the Year award. 

The LSB’s and Solicitors Regulation Authority’s (SRA) recently released ‘Innovation in legal services’ report cited regulation as both the biggest enabler of innovation and the biggest barrier. It is, therefore, understandable that the West Midlands-based outfit took the decision to create a centralised compliance unit to ensure it was complying with all its regulatory obligations. 

The five-strong team opens new client matters and deals with day-to-day inceptions and conflict checking. In addition, the firm employs two compliance assistants who focus on workflow development and process mapping.

The changes have been led by a concept the firm calls ‘intelligent delivery’, which has been embedded throughout the business. 

‘We saw that files were always opened by secretaries,’ explains Lyn Coughlan, the firm’s audit and compliance manager, ‘[including] AML checks and client verification process. With the increased requirement of the SRA to ensure we were doing this properly, we actually realised these checks weren’t being done properly.’  

When FBC first broached the subject of centralising compliance, other LawNet firms expressed scepticism, believing fee earners would be resistant to change. But, contrary to such fears, FBC found its fee earners felt receptive to the change after a thorough ‘process mapping’ exercise, which followed a client’s files from the point of entry through all checks to opening a file. 

‘They have the confidence the checks are being done properly, they’re not exposed to any risk now because we look at everything thoroughly and do all the checks on the database that we need to,’ adds Coughlan. 

This new approach has driven efficiencies across the firm, embedded a culture of compliance within the business, and made fee earners work more profitably.  

‘That portion of time a fee earner or support staff member spent at the beginning of a matter going through the client compliance process, which has now been taken over by the compliance team, is allowing more time to add value to the work being done. The process is something we’re adding onto every area of the business,’ says FBC’s marketing manager, Laura Jones.   

Going niche

Many firms are grappling with whether to ?scale back on the services they can offer clients. ?For Matthew Arnold & Baldwin the decision to reshape its practice to solely focus on three sectors – banking and finance, life sciences and healthcare, and technology, media and telecommunications – is one that has paid dividends over the last ?two years.  

 ‘We’ve recognised we need to be different, that we need to be focused to make a difference in the law,’ observes head of corporate, Richard Phillips. 

‘There are too many firms which are not and are getting into a situation where they are not really known for anything, or they become flabby or less price competitive. They become organisations that don’t really know where they are going, and we wanted to avoid that.’

Phillips admits his firm’s strategy may not sound particularly innovative, but it does add credibility for clients: ‘We decided to scale down on what our message is and really focus on core sector groups. We went down initially to a number that was far too many and saw how those panned out over ?12 months and then cut down to three.’

Surprisingly, there has been no reduction in headcount, despite the business’s new direction. ‘It hasn’t meant we’ve gotten rid of people, rather we’ve incentivised them to be more focused on what they are doing and what they are pushing,’ Phillips adds.  

The firm’s geographical location has also ?given it a surprising advantage over City rivals: ‘Twenty years ago people laughed if you worked in Watford,’ confesses Phillips. ‘But, they have suddenly realised life is a bit more savvy than ?that. We’ve always seemed very close to London... ?Now we seem more competitive. We have less overheads here than in London.’

Words of warning

There are, of course, a whole host of firms trying to revolutionise the legal services market, but what words of advice, encouragement, or warning can the above reformers give on the importance of innovating within the sector?

‘You have got to embrace new technology. You have got to be prepared to keep changing until you get it right. And then you will have to change again because everything else has changed,’ says Filder & Pepper’s managing partner. ‘The only constant thing is change. The only way of surviving is to create an agile company that can adapt.’

Slade opines that very little innovation now comes from the City elite because incumbent forces never tend to innovate: ‘You used to look at the big City firms and view them as something you were envious of, but we really don’t see it at all now. If we come up with an idea, we can have a new product out within a couple of months, without it going to committees.’

Breeze and Wyles’s Fraser adds: ‘Since the Legal Services Act, people have been convinced nothing is happening very fast. There are plenty of big businesses out there, like retail businesses, starting to compete, and you are going to have to play the game with them. 

‘When the likes of Slater and Gordon start buying up conveyancing practices, or when LegalZoom comes in from the US, there is going to be a lot of competition. It’s going to be whoever can do the work efficiently, and in a consumer-friendly way, that’s going to remain in business.’ SJ

Solicitors Journal @JvdLD john.vanderluit@solicitorsjournal.co.uk

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