What do lawyers and Pakistani factory workers have in common? More than you think. Especially when it comes to innovation. Research out of Columbia University looked at how innovation spreads in a seemingly simple area, manufacturing of soccer balls. The researchers discovered that the Chinese have come up with a far more efficient way to cut out the fake leather used to make soccer balls. This basic design improvement increases profits by 12% in firms that followed the newer process for cutting out the hexagons and pentagons for soccer balls.
There was no doubt, the new process was clearly more efficient and would make firms more money. To help spread this innovation to the factories in Pakistan, the researchers provided very specific instructions on this simple change that would make factories more money. Over 100 factories were given the new design and information. A year later, only six had actually implemented the change. Why was the number so low?
The factories were all in favor of this clear improvement in the process, but the factory workers were highly resistant. Factory workers in Siakot, Pakistan are paid for each piece they cut out, and learning a new process meant that they would have to slow down in the short term and so they resisted the decrease in pay. It seems very shortsighted by the factory workers, but the truth is that the goals of the bosses weren’t in line with the workers. The six firms that were successful in making the switch were willing to give bonuses to the workers willing to learn the new process or had some other incentive that made this a win-win situation.
What does this have to do with lawyers and law firms? For over two decades law firms have had major innovations available to the firms in the form of systems for project management that would drastically reduce the cost of litigation and increase the effectiveness, yet the majority of law firms still haven’t adopted these practices. In more recent years, new customer relationships management (CRM) software exponentially increases the value of the combined networks of law firms, yet most lawyers either don’t share their contacts or are unwilling to take the time to learn the power of the tool. Take a look at Linkedin and other social media. These tools were thought to be a game-changer for law firms, finally, every member of the firm could do something to advance business development, but at most firms, the true participation of lawyers actively sharing using social media is less than 5%.
What do all three of these examples have in common? Most firms are preaching the benefits of these practices, but almost none are tying compensation to their use.
The message from law firms to lawyers sounds a little like this:
“Please use all these new innovations, but we will only reward you for doing things the old way.”
Law firms are filled with factory workers that instead of getting paid by the piece are getting paid by the hour. Where is the motivation to provide better service, more efficiently, at a lower cost? It isn’t there, and until firms provide a carrot in the form of compensation, lawyers will keep cranking out the hours. Innovation isn’t easy, but law firms the make it a priority can find a way to make more money and provide superior service to their clients. That should be all the incentive firms need.
Here is a Youtube video explaining the process: https://www.youtube.com/watch?v=PHgY9YGicz8
Adrian Dayton is an internationally recognized speaker on Linkedin and social media for the legal profession. He is also the founder of the software company Clearview Social that helps firms amplify their influence through Linkedin. You can find out more at http://Clearviewsocial.com