With COVID-19 situation getting beyond control, businesses across sectors irrespective of their sizes have been deeply impacted and are triggering an economic downturn. With economic hiccups, legal systems will be affected too and hence, law firms must prepare to embrace the new normal. As the government will try to bring more effective public health schemes and revive our economy, the law firms must be prepared to operate under a more flexible and dynamic policy regime with government interventions.
The last couple of months have actually brought a stand-still in legal operations with limited court functioning; postponement of scheduled hearings; drop in legal queries, client retainers and budgets; payments being withheld and recoveries dropping attributing to negative cash flows (with costs being sustained). The situation is definitely not encouraging and to top it all, leading to low morale and more stress.
The previous global economic downturns have taught us that the local players have not been deeply affected as compared to firms with presence in global markets. Additionally, the litigation, restructuring, Insurance and regulatory practice areas were thought to be money spinners for firms as compared to transactional practices. However, it was learnt that owing to slew of regulatory and financial reforms, the transactional practices did see an upsurge with increased demand for legal services. Despite increased write-offs, excessive discounts and delayed settlements, Law Firms did manage to sail with a definite pricing strategy and a more focused recovery plan.
These are certainly the testing times however, not all sectors have been equally impacted. The COVID-19 crisis has deeply affected the Services sector (Hospitality, Lifestyle, Travel & Tourism, Entertainment, Education, Urban Transport among others). While sectors like FMCG, Real Estate may have experienced a muted demand; sectors such as Healthcare, Medical Supplies, Food Retail, In-home entertainment, Insurance are experiencing a sharp increase in demand.
The opportunities will still be out there. However, with an all-time high competition, increasing operational costs and clients negotiating for better commercial arrangements circumventing the COVID-19 challenge will require law firms to be more definite, accountable and effective with their deliveries and pricing. This in turn, will call for observing efficiencies in controlling costs and utilizing resources more judiciously and hence, technology will play a pivotal role.
Embracing the technology to create a more productive work environment will be the key to success. Monitoring work, analysing progress and communicating effectively to the clients will bring a complete paradigm shift. Innovation, Efficiency and Financial Prudence will be the key drivers for client and employee engagement to ensure a mutually beneficial relationship.
www.grandmasters.in | 8 Years & Counting
www.rcls.in | 8 Years & Counting
www.itlegalsummit.com | 8 Years & Counting
www.bfls.in | 8 Years & Counting
www.maels.in | 8 Years & Counting
www.plcs.co.in | 8 Years & Counting
Copyright © 2020 Lex Witness - India's 1st Magazine on Legal & Corporate Affairs Rights of Admission Reserved
