denotes premium content | Oct 16 2008 Managing Partner archive
Volume 6 Issue 2
Risk management has been an area easily overlooked in the annals of law-firm management. The solicitor’s indemnity fund (SIF) provided firms with the security of knowing that they would be covered, but with the demise of the SIF and the advent of an open-market insurance regime, firms are facing a more perilous path in ensuring they are adequately covered against all eventualities.
The dangers of neglecting risk management are obvious but there are still many firms that fail to meet the obligations. Frank Maher, head of professional indemnity at Weightman Vizards, knows of several situations where firms have neglected to fulfil the current insurance obligations and, as he says in his article in this issue, some are paying the price with bills of as much as £500,000.
Law firms need to acquaint themselves with the potential problems of the new insurance regime: the dangers of non-disclosure, complex successor-practice provisions and insurance-notification requirements. Evidence to date suggests that many firms are failing to appreciate the new demands of the marketplace or they’re not absorbing them into the business strategy of the firm. Some firms, however, realising the importance of an effective risk-management strategy, have recruited a dedicated risk manager or partner who can focus their time on the many aspects of this complex area.
John Verry, a risk manager at Charles Russell, and Chris Andrews, a risk partner at Clifford Chance, both represent this change among law firms that are conscious of risk management’s growing importance. Their articles highlight their experiences, the challenges of the role and the reasons why they are becoming such integral members of the legal team. These specific strategies for managing risk bode well for the future, but the resounding conclusion of this issue is that all such steps are worthless unless made as part of a risk-aware culture. Cultivating an environment where every staff member understands and adheres to the firm’s risk-management strategy is a real challenge but neglecting to do so could be catastrophic for the firm’s financial future. Hopefully, this month’s articles will provide some helpful guidelines in tackling the inherent difficulties of the task.
Away from risk management, this month’s technology section focuses on portals, a particularly hot topic for law firms at the moment. As the technology Q&A illustrates, firms are at different levels in their portal implementation, some having just launched their service, while others are down to their third or fourth-generation models. Their experiences are, however, surprisingly similar, perhaps reflecting the extent to which law firms are now learning from the successes and failures of those that have gone before. On this note, Ark Group will be holding its first dedicated legal portal event at the end of this month (18-19 June) and I hope we can look forward to seeing you there.
Caroline Poynton
Editor
Features
Practical steps to an effective risk-management strategy
Law firms may take a varied view of risk from a wide perspective, including risks to the firm’s reputation to a narrow regulatory approach to managing specific claims. Whatever the approach, all firms must now adopt some kind of risk-management strategy if they are to survive the potentially damaging claims of the current environment. Chris Andrews, a risk partner at Clifford Chance, explains his role and the practical steps firms can take to ensure they are covered against every eventuality.
Risk management: A bird’s-eye view
John Verry, who joined Charles Russell as a risk manager in January of this year, reflects a growing trend to recruit dedicated risk-management professionals who can apply their expertise and involve the entire firm in the risk-management process. In this article, he explains why firms, faced with a changing insurance regime, cannot afford to be laissez-faire when it comes to risk management.
Understanding the perils of the professional-indemnity partner
Failing to meet the complex requirements for professional indemnity can be catastrophic for law firms. Successfully managing the process might be the final responsibility of a particular partner but, as Frank Maher, national head of professional indemnity at Weightman Vizards, explains, it is a duty that must involve the co-operation and understanding of the entire firm.
Legal technology: Opportunities, implementation, strategy
Technology Q&A: Portal power
Many firms are now looking at the business benefits of developing a portal. Effective implementation, however, requires a clear strategy, a balance of internal with external needs and a commitment to the content-migration process. Caroline Poynton talks to IT directors Janet Day, of Berwin Leighton Paisner, and Ian McFiggans, of Lovells, about their experiences.
A brief history of Pathfinder – AS&K’s new enterprise portal
Appleby Spurling & Kempe (AS&K) recently launched its Pathfinder portal. Christopher Maiden, Pathfinder’s project manager, offers some insights into the often-neglected soft side of its development.
Management and performance reporting: How well do you know your firm?
Management reports are essential to gaining and disseminating important information about a law firm, including its people, processes and profitability. For those firms that do it well, the rewards include better management, reduced risk and ultimately, increased profitability. Justin North, a consultant at Baker Robbins & Co, explains the risks of inadequate performance reporting and how firms can use their existing systems to get it right.
There but for the grace... Lessons learnt from the Clifford Chance memo
Associates at the New York office of Clifford Chance wrote a memo at the end of 2002 that was subsequently reported in the international press. The repercussions were significant for such a well regarded firm, but the lessons are relevant to every law firm that could easily find itself in a similar position. Gerald Riskin, a principal at Edge International and a former managing partner, uses the memo as a basis for a two-part article on the good, the bad and the ugly of law-firm management.
Regulars
Drafting in the British reserve
In January 2001, US firm Reed Smith and UK firm Warner Cranston completed merger negotiations and began trading as Reed Smith Warner Cranston (since January 2003, it has been branded Reed Smith). Tim Foster played a pivotal role in the run up to merger and has continued to stamp his mark as UK managing partner. Caroline Poynton talks to the man at the centre of Reed Smith's international expansion.
