Combat accountancy threat through partnerships

A new survey has found that only 50 per cent of Australian and New Zealand law firms are planning to increase collaboration with other professional services firms over the next three years.

According to ALPMA president Andrew Barnes, the threat of infiltration of non-legal firms on the legal market isn’t just a big firm problem.  With so many non-legal firms now offering legal services, law firms that form collaborative relationships have a significant strategic advantage.

“Multi-disciplinary partnerships will not disappear from our landscape,” said Barnes.

“Firms failing to consider such relationships are also failing to realise how easy it is to start a greenfield law office, let alone as an add on to an established and well regarded professional services firm, possibly even with common clients.

“The challenge will therefore be in preserving referral workflows on one hand and not losing core work to a competitor who is a one stop shop on the other.”
Barnes added that with so many options for legal services, full service law firms may eventually become a thing of the past.

A strategic plan is the starting point, said Barnes.

“In the small-mid market any strategic relationship is likely to grow from an existing personal relationship so the ability to leverage this is crucial,” he said.
The report also found that less than 10 per cent of firms were planning to merge with another firm, although Barnes pointed out that it’s unlikely that many firms would volunteer that they are a takeover target, with a much higher 18 per cent responding that they had planned acquisitions.

The mergers and acquisitions number combined therefore makes up a whopping one in four firms seeking to join with another firm as their three year strategy.

“I would hope that the 3 in 4 firms who are not thinking along the merger path are doing so because they are determined to challenge convention and work differently, collaboratively so as to grow and prosper,” Barnes said.