Streams, Waves, and Flat Seas: What Strategy Is Really About for Law Firms

Strategy triggers very different reactions within law firms.

Many partners see it as a secondary issue, something that can be discussed from time to time, when there is nothing else to do. Some even view it as pointless talk, an unnecessary distraction, a waste of time not worth their attention.

At the other end of the spectrum, some take strategy very seriously and strive to give their firm a carefully thought-through strategic direction. For them, this exercise is essential.

To move beyond what may seem like an irresolvable debate, let us start from a simple observation: whether we like it or not, whether we think about it or not, the firm’s positioning in the market is the single most decisive factor of its success.

Strategy is therefore never an end in itself. What matters is the reality of the positioning. The time devoted to strategy is justified only to the extent that it effectively strengthens the firm’s positioning. Therefore, before talking about strategy, we need to explore the notion of positioning.

Let us use a maritime metaphor and distinguish three situations.

Streams

The ocean is crossed by powerful, steady currents. Think of the Gulf Stream. The legal market is no different: certain industries and clients have a constant, or at least regular, need for legal advice.

Firms that manage to position themselves favourably on such a current capture a significant share of this flow, without the need for sustained effort. Day after day, month after month, year after year, matters keep landing on their desks. From a strategic perspective, this is the ideal situation.

Waves

A wave represents a sharp increase in the flow of work, significant but limited in time. A new regulation requires the implementation of new legal frameworks; a crisis calls for massive mobilisation; a technological innovation requires contractual adjustments, and so on.

For the firm, this results in major fluctuations in activity. Those that benefit from waves are able to anticipate them, prepare for them, absorb the peak workload, and manage the downturn calmly while waiting for the next wave. Other firms, by contrast, handle waves poorly: they fail to see them coming or see them too late, miss them altogether, lack the resources to absorb the additional work, or are seriously weakened when the wave recedes.

Flat Seas

Finally, a firm may find itself in flat seas, almost at a standstill. It is disconnected from any current and surfing no wave. At best, there is a bit of chop, some swell, and the distant echo of the waves created by large ships passing on the horizon: the occasional matter here and there, and the crumbs left behind by firms that control the currents and the waves.

A firm in flat seas is underutilised. There are few, if any, new clients and new matters. The firm barely survives but does not grow. Morale is low. Business development becomes a daily concern, consuming a great deal of energy for results that are uncertain and often disappointing. Repeated good intentions and action plans change nothing, because the problem is not a lack of effort or competence, but weak positioning. Doubt and anxiety set in, gradually eroding confidence in the future.

When Strategy Truly Matters

“Doing strategy” or “having a strategic plan” are not the issue. What really matters is being well positioned with respect to currents and waves, so as to have first pick of the flow of work they generate.

Strategy can thus be defined as the art of positioning the firm favourably in the legal market (or a segment of it): placing it at the heart of the currents and enabling it to ride the waves. If the firm already benefits from such a favourable position, strategy becomes the art of maintaining and keeping it up to date.

Strategic work necessarily starts with an objective assessment: What is the objective reality of your positioning? Are you on a current (or several)? Are you able to anticipate and absorb waves? Or are you stuck in flat seas? This diagnosis is only the first step of the strategic journey.