As the legal market consolidates, it should look to the cloud to make mergers more seamless
By joining forces, small law firms hope for access to more-lucrative deals and to retain existing clients. For larger firms, combinations offer ready-made regional offices or expanded practices. Building new practice areas within a firm is too costly these days, legal experts say. And hiring individual partners has had mixed results.... [however]
Law-firm combinations are complex, risky propositions. The costs of integrating new employees, real estate and computer systems might not offset hoped-for gains from increased billable hours, access to more business, or economies of scale. Alliances also can founder over how much partners are paid or which lawyers will hold the reins in the new firm. Partners peel off for greener pastures, sometimes taking clients with them, after a merger. Conflicts between clients can emerge when the rosters of two law firms are combined.
Law firms, big and small, are merging. The value in consolidation is primarily on the revenue side -- they're able to serve more clients, and serve their existing clients more comprehensively. However, mergers aren't without their costs. What only gets mentioned in WSJ's coverage of this phenomenon is the costs of combining information systems.
The plodding, proprietary document management systems used in law firms don't lend themselves to easy adoption and integration when two firms merge. This is yet another reason that firms should look to cloud-based solutions like Ridacto. There is no "integration" with cloud-based solutions, and firms don't have to worry about throwing away server banks or software licenses. Cloud solutions are light-weight, flexible, and cost-effective.