Whilst the last five years or so have finally seen some big changes in the legal industry across the globe with many top tier US and UK firms, in particular, starting to globalise, the profession is still hugely fragmented compared to others such as accounting.
At the same time the Big Four accounting firms have struggled to generate organic growth in tougher economic conditions and are looking for growth through diversification into additional services such as legal. Not a surprising approach - strong brands and blue chip client bases to leverage from. They tried before pre-Enron but this time is different. And the law firms seem to be just burying their heads in the sand as their industry gets taken over by stealth.
This article in The Economist articulates well how this is playing out...
CONSULTING has its Big Three; accounting the Big Four; and executive search a Big Five. But there is no corresponding clutch of dominant law firms. None has amassed as much as 0.5% of an industry with global revenues of around $650 billion a year. Even the biggest law firms may be anachronistically inefficient. They are run by lawyers, not professional managers, insist on charging by the “billable hour” rather than by results and use little technology more advanced than e-mail. Nonetheless, most big law firms have continued to be highly profitable. In recent years, clients have begun to rebel against the billable hour, and at being charged senior lawyers’ rates for work done by juniors. Some have started sending basic legal paperwork to cheap, offshore processing centres. Only now is a serious threat to the law firms’ cosy existence emerging.