Welcome to this Deloitte Insight report which looks into the future of the talent landscape in law firms.

While the legal profession has undergone significant change in recent decades, over the next ten years, we expect to see profound reforms across the profession. Law firms will need to transform the way they think about how they attract, develop, retain and change talent in order to succeed. We expect the more radical changes to take place as 2025 approaches, but firms must prepare their business and talent strategies now to position themselves effectively relative to their competition and the challenges that lie ahead.

This report considers the future of talent in the legal sector based on past trends, an extensive review of literature, discussions with experts and an assessment of potential scenarios. It also helps firms identify what talent strategies may be most relevant and suitable for them. Law firms need to assess their current and future capabilities and aspirations to identify their talent priorities.

We would like to thank everyone who contributed to this research. We hope you find our insights thought-provoking and useful, are keen to debate further and welcome your feedback.

Executive summary

This report examines the future of talent in law firms in the UK over the next decade. It considers how law firms might change, to respond to challenges that are transforming the sector, focusing on what this could mean for future talent in the profession.

Transformation by 2025

Over the past decade, the legal profession in the UK has evolved to respond to changes in the labour force, client demands, technological innovations and broader policy developments. These factors have already altered the way many firms operate. Leading firms are preparing their businesses for further change.

The transformation of the profession is likely to be profound due to the quickening pace of technological developments, shifts in workforce demographics and the need to offer clients more value for money. Indeed, by around 2020, we expect a tipping point for individual firms which will impact the competitive landscape and the role of talent in law firms. Businesses must prepare effectively now so they are not left behind by the end of the decade.

Strategic choices will impact talent

Firms will need to make strategic choices based on how they will operate in the new environment. At the broadest level, this could be to change or continue in the same business segments and/or geographies. This report considers talent outcomes for a range of scenarios based on potential business strategies for the future.

There is no one best strategic option; choices will depend on the aspiration of the firm. Identification of the most appropriate business strategy should be based on the assumptions around future demand, a business risk review and prioritisation of areas in which to invest. This will need to reflect both clients' future needs and other external factors such as technology, globalisation and regulation. However, the strategic choices made will impact the number, type and mix of people required within law firms, affecting how firms should access, attract and develop the best candidates. The talent strategy should be closely linked to and developed in conjunction with the business strategy.

Adapting to a new talent model

Even firms that opt for the status quo – offering the same services and operating in the same geographical markets – will require a review of their talent strategy. Aspirations for radical business outcomes and strategic choices will require more significant change to attract and develop talent.

Strategy and human resources leaders will need to take innovative approaches to staffing in future to adapt to the transformation of the profession. Firms will want to continue to demonstrate that they can offer clients the best products, price and service. However, prioritising what to focus on will help to achieve a better return on investment. With this in mind, firms should develop talent that is dedicated to their relevant strategy.

We expect three 'talent pools' to form the structure of front-office employees within the future law firm:

  • Partners and leaders – to embed the most appropriate culture in the law firm.
  • Traditional, permanent staff – primarily fee- earning lawyers who firms should attract, retain and develop in the conventional way.
  • Non-traditional and transient employees – including project managers, sales executives, dealmakers, data and technology experts as well as lawyers. Access to these employees may be through partnership arrangements or contactor models. These staff will also require alternative incentives and training structures.

Mid-sized firms will need a focused talent strategy as they compete with large firms, that have scale to invest and innovate, and smaller firms that are agile and less restricted by fixed costs. Pressure on mid-sized firms will intensify as merger and acquisition activity continues and the market sees more new entrants.

We believe that the most successful law firms will be those that are agile enough to flex resources in order to meet client needs at an efficient price. They will need access to lawyers who have a broader skill set and are not just technically   competent lawyers.

Download - Developing Legal Talent - Stepping Into The Future Law Firm

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