Who? Me Innovate?!

Aric Press, always worth reading, writes in this month's American Lawyer about potential challenges to the Rosy Scenario common wisdom of leaders of the AmLaw 200.   He reports:  "So is there anything to worry about for the future of the large and grand law firms? Really only two things: their clients and their lawyers. That's all."

On the client side, he delineates the challenges as follows:

• "First, is there enough demand to sustain all the law firms...
• "Second, as clients grow ever more sophisticated, will they continue to put up with service that is not as attentive as it should be...
• " Third, clients have put more demands on firms to work with teams of lawyers who are more balanced by gender and race [and it's not clear how firms can respond].
• " Fourth, will clients support the global firm model?"

And on the firm/lawyer side, the challenges primarily have to do with the war for talent, leadership, the Baby Boom/Gen X-Y transition, and the tension between being "revenue machines" and professionalism.

Aric also cites, while discounting, the odds of a major "exogenous" disruption such as the passage of Clementi-style reforms here in the US, or a major merger between a Western and a Chinese firm—two eventualities to which I would assign far higher odds, at least if your timeframe is a decade or so.

Fascinating, but all woolly speculation until it hits home? 

I think not. 

The pressures on our profession, and our industry (for it is indeed both), to innovate have never been greater.  Increasingly, "the way it's always been done" is not a satisfactory strategy or approach.   We have had distant early warnings of this for well over a decade, and if you doubt that—or even if you don't—I invite you to read The New York Times' coverage of Lord, Day, & Lord's closing its doors in 1994 (with the pithy headline/diagnosis:   "Oldest Law Firm is Courtly, Loyal, and Defunct"). 

The problem is that we've never been much good at innovation.  And now we have no choice.  As it turns out, corporate America doesn't have a stellar reputation for innovation either, which has made it the subject of study at—where else?—Harvard Business School.  Indeed one of the 25 most-read articles of 2006 on HBS's "Working Knowledge" site was "Lessons Not Learned About Innovation," featuring renowned Prof. Rosabeth Moss Kanter. 

What lessons are "not" learned?  Mistakes of the past are repeated, to begin with, including these basic no-no's:

• burying the innovation team under bureaucracy
• conversely, treating them as super-stars more valuable than the rank and file doing the dirty work of pulling in revenue and satisfying clients
• choosing people to "lead" the team who can't communicate and can't relate, and
• sounding the trumpet for innovation but then shooting down every actual proposal brought forward.

More interesting is what does work at fostering innovation, and I'm pleased to report that Prof. Kanter's very first recommendation is to "look for small innovations, not just blockbusters," as this has long been one of my themes when asked to discuss innovation or creativity.  Indeed, one of chief lessons of Clayton Christensen's classic, The Innovator's Dilemma, is that small creations with, initially, minimal functionality, can grow up into the category-killers that slay the incumbents.   The other problem with swinging for the fences is that, sad to report, it's typically beyond we mere mortals' ability to envision the entire business ecosystem needed to let an innovation truly flourish and, locked in to current assumptions, we either clone what we're familiar with or suffer a complete meltdown of vision.  An example?  Ken Olsen, co-founder of Digital Equipment Corporation, famously said in 1977 that "there is no reason for any individual to have a computer in his home."

Another message is to keep lines of communication actively and vigorously open, between the innovation teams and the people who are keeping the trains running on time.  You can only imagine the types of resentful, self-defeating behavior that could be engendered by treating the new team as presumptive keepers of the keys to the future.

Perhaps the most helpful piece I'm aware of in terms of getting a handle on innovation is also from "Working Knowledge," Why Managing Innovation is Like Theater, which also argues for "exploration, adjustment, and improvisation."   This is particularly true of the type of work lawyers do:

"knowledge work, which adds value in large part because of its capacity for innovation, can and often should be structured as artists structure their work. Managers should look to collaborative artists rather than to more traditional management models if they want to create economic value in this new century."

Fine, but how do artists "structure their work?" Essentially, through cheap and rapid iteration, a/k/a practice. Rather than trying to get it right the first time, focus on keeping the cost of re-doing it low. The flow is:

• try
• learn
• reconfigure

This essentially substitutes experience for analysis, which is going to make the lawyers in the audience extremely uncomfortable at first blush.  All I can say is, "try it, it works." 

So:  We are being called upon to innovate as never before, something which:  (a)  We have a lousy track record of;   (b) We tend to instinctively recoil from; (c) Requires us to substitute experience for analysis, and substitute experimentation for perfection.

But really, we have no choice.  So we may as well try to be good at it.