When the urge to converge of law departments goads the urge to merge of law firms

As law departments put out to bid portfolios of legal services that can reach tens of millions of dollars, larger law firms – with the capacity, reach, infrastructure, and capital to handle boatloads of work – will be the odds on favorites to be chosen. Convergence efforts by clients, therefore, will justify mergers of firms. (See my post of May 1, 2005 on the dark side of partnering.)

What else? Conflicts of interest policies on both sides will need to soften (See my posts in 2005 of April 2 on merger conflicts, May 30 on conflicts policies, Aug. 5 about Foster-Wheeler using a single firm, and Oct. 23 on the frequency of disabling conflicts.).

Overhead costs will climb as law firms expand, and possibly be passed through to the law departments so intent on reducing costs (See my post of Oct. 23, 2005 about size correlating with overhead costs.).

Challenges within law firms of managing consistency and quality control will crop up more frequently. Satisfaction levels of law departments will fluctuate more.

We may see more break-offs of partner groups, either out of dissatisfaction with the large, corporate-style firm or because outside the huge firm they can pursue the work they want (See my post of Oct. 4, 2005 on law departments urging partners to leave.)

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