puzzle pieces fitting together

Strategic Alliances: Alternative to Hiring Full-Time Associates

As smaller law firms are taking a more conservative approach to hiring full-time attorneys, a new staffing trend has emerged that allows small and boutique firms to accept cases they otherwise may not be able to take due to lack of manpower or expertise. Rather than hiring an attorney to assist with the case–one that may be laid off once the case is concluded–firms are now joining forces, or forming strategic alliances, with sole-practitioners or lawyers from other similar-sized firms. This allows them to grow and shrink as necessary without going through the expensive, time-consuming, and morale-reducing process of hiring and firing associates or even partner-level attorneys.

The potential benefits of strategic alliances between small law firms was recently discussed in a Daily Journal article entitled, “Smaller litigation shops teaming up more, hiring less” (March 11, 2015).

Consolidation among these firms, the dynamics of big law and the countercyclical nature of the practices compared to the economy have created a deeper, if more dispersed pool of available talent over time.

The combination of these market factors has also given sole practitioners and small boutiques with litigation chops more opportunities to work on big cases without having to give up their autonomy, although many of these cases require deeper benches, leading to more collaboration.

The Daily Journal article makes a compelling case for the increased use of strategic alliances among law firms, especially boutique firms that serve institutional clients. Entering into such alliances will require lawyers to transform their mindset. Specifically, they will need to move away from seeing similar law firms as potential collaborators rather than exclusively as competitors. Lawyers don’t have a great track record of collaborating with colleagues in their own firms, let alone with potential competitors. Law firms are therefore unlikely to use strategic alliances as much as they could or should.