Littler asked a different question: which part of the work could be delivered differently?

Littler asked a different question: which part of the work could be delivered differently?

One of Littler Mendelson’s largest clients demanded a 20% reduction in its legal spend within a month. The usual response in such circumstances is familiar: negotiate a discount, adjust the team, absorb the impact on margins and move forward.

Littler asked a different question: which part of the work could be delivered differently?

The result was Littler CaseSmart, a platform that unbundled the employment claims management process, redesigned it through proprietary technology and a different staffing model, and delivered it to the client at a structurally lower cost.

The client’s legal spend fell by between 20% and 50%, while Littler’s revenues from that practice area nearly doubled, because profitability no longer depended on hourly rates but on process efficiency.

Four years later, once the platform had demonstrated its potential, the firm’s leadership made a decision that few managing partners have the courage to make. They asked Scott Forman, one of the firm’s leading rainmakers, to stop billing clients and devote all of his time to leading LCS.

Tom Bender explained the rationale with striking clarity: “Continuing to reduce rates is like eating ourselves one finger at a time.”

The signal that Littler recognised was not simply an isolated demand from a difficult client.

Nor is that signal exclusive to large firms. In a boutique practice or a mid-sized firm, it appears under different names, but it is there nonetheless. It is the client who, for the first time, asks whether there is a more efficient way of doing something, or the matter that previously went unquestioned but now prompts conversations about the value it truly delivers.

They are exactly the same signal, only with a less immediate sense of urgency, which makes them easier to ignore.

At your firm, does pressure on fees trigger conversations about price or about the business model?

Marc Gericó
Global managing partner, Gericó Associates