fivehundred magazine > Interview with... > Gunther Schumacher: The learning process – helping law firms embrace new ideas

Gunther Schumacher: The learning process – helping law firms embrace new ideas

Venable’s chief revenue officer says true innovation is more than a buzzword, it is in the service of a purpose, while marketing should not be confused with advertising

Please give us some background on your career to date and how you came to join Venable?

I spent the majority of my career in advertising and marketing services – originally as a writer, then in client services, and finally in management. The red thread throughout my career has been around creativity, technology, and transformation. I had known Stu Ingis, Venable’s chairman, for several years through an industry association, the DMA. I was on the Board and the Executive Committee, he was the General Counsel. We got to talk about the changes in the legal industry and how they mirror a lot of the changes I have seen and worked through in other professional services industries, including advertising. It seemed like an interesting challenge to me to switch industries and we both felt that it was a good fit. So here I am.

What was your initial perception of the legal world? Is it as ‘stuffy’ as some outsider may perceive?

I must say that I don’t find the legal industry (at least at the level Venable is operating) stuffy at all. Lawyers are incredibly smart, creative and they like to debate. My academic background is Philosophy and I have found many kindred spirits when it comes to the love of a good argument and the Socratic method.

How do you see the nature of your role across revenue management, marketing and product development, and client relationships?

I have come to realise that there is no clear industry standard in the legal world for business development, marketing, and practice management. Each firm seems to have their own version. Sometimes BD and PM are bundled together, sometimes BD and marketing, and so forth. After a couple months learning ‘legal’ and Venable, we agreed on a unifying strategic framework, which has since helped us to integrate our efforts and our departments and agree on one common mission statement. In essence, the CRO (chief revenue office) is all about helping with the Client Experience Journey – making us an ‘irresistible choice’ to pick and a ‘delightful’ partner to work with. All the tactical activities will be aligned with this and measured against KPIs that flow from the Client Experience Journey. Leading this transformation towards a more client-focused, integrated, and outcome-oriented set of activities is the primary focus of my role.

Do law firms really understand marketing and innovation?

The short answer is ‘no’. The more considered answer is ‘they are learning’. A lot of people (not just in the legal world) confuse marketing with advertising and advertising with TV or print ads or internet banners. On the innovation side, law firms are by nature conservative and resistant to change. There is also a false sense of security in something that has worked well for many decades. But I can see how all of this is changing. There is an understanding that the world is in rapid transformation mode and that law firms will increasingly be affected by that. My hire into Venable is an unusual and quite brave move. To me it is proof that at least one AmLaw 100 firm is taking another look at marketing and is ready to innovate.

How would you define your firm’s culture?

Venable is very much a people culture (just like my previous firm, Ogilvy, by the way), which is why I like it so much. There is a lot of respect and room for the individual and their uniqueness, needs, and ideas. Despite our size, Venable is neither very hierarchic, nor very bureaucratic. What holds the firm together is a set of shared values and beliefs (like client centricity and team). Like any organisation that is truly people focused, diversity is an integral part of this fabric.

What’s the main change you’ve made in the firm in the past few years that will benefit clients?

Remember, I’ve only been here for nine months… but I mentioned the Client Experience Journey as a strategic framework, which has already proven itself to be an integrating force. The other thing I would mention is agile work methods. I have done a lot of work in the digital/technology/software space in the past and am a firm believer in agile – client-centric, highly collaborative, cross-disciplinary work that is focused on continuous improvement. We have started an ‘Applied Insights Lab’ at Venable this summer under the leadership of a freshly minted scrum master. This new way of working (new for a law firm) is like a breath of fresh air and the results are better and faster.

What have been the biggest challenges of the recent merger with Fitzpatrick, and what benefits has it brought to clients and staff?

In any merger, the two biggest challenges are always the shared value proposition and the ‘evolving’ culture. As far as the former goes, Venable Fitzpatrick is a no-brainer, because the areas of experience are purely complementary and of huge value for our clients. As far as the culture goes – Venable and Fitzpatrick had very compatible cultures in the past and you can see that when you put a dozen legacy Venable and a dozen legacy Fitzpatrick people in a room. You’ll be hard pressed to figure out who’s from where. By the way, Venable’s decision to double-down on IP was one of the ‘clinchers’ for my decision to join. Venable already had a superb IP capability, but with the addition of Fitzpatrick we are moving into a more significant leadership position. I believe that the need for extraordinary IP lawyers will dramatically increase in the future.

What have you found is the best way to retain talented partners and associates?

In general, I have always found that people stay because they have a sense of ‘belonging’ and they leave if they don’t have that. This does not seem to be any different in a law firm. ‘Belonging’ requires shared purpose and values, recognition, development, team, and culture. Money is one part, but that always sorts itself out in the end.

What are your firm’s policies on diversity and inclusion?

Venable has a genuine passion about diversity – gender, racial, sexual preference, religion – because we believe in and celebrate people, their individuality and their talent. Our diversity numbers are equal to or better than the rest of the industry. But we are frustrated with our own success, restless, and focused on actual things we can do to improve. For example, 42% of our Board is made up of women and people of colour and of our four divisions, two are chaired by people of colour. We hope that in addition to increasing our hiring, we are building a pathway to success and leadership in our firm for all attorneys regardless of background. It reflects not only the strength of our diverse partners but also the importance of their role in management in mentoring and being models.

What does innovation mean to you? How can law firms best encourage innovation in all its forms?

‘Innovation’ is a game card in today’s buzzword bingo, just like ‘data’ or ‘transformation’. I believe that innovation is most powerful when it is balanced with something that offers continuity and direction – like ‘purpose’ or ‘culture’. Take IBM for example, arguably one of the most innovative companies in the world and a former client of mine at Ogilvy. Their core value proposition has not changed for over 100 years: ‘leveraging data and technology to make the world work better’. But the ways they have been doing this, and the solutions they have developed, have been so innovative that for decades they produced more patents every year than any other organisation in the world. IBM Watson is a true AI solution that is being used today in areas as wide-ranging as crime prevention and cancer cure. I’d call that true innovation, but in the service of a purpose and a value proposition that has a rich history. I think law firms can learn a lot from this.

Is technology changing the way you interact with your clients, and the services you can provide them?

Yes, most definitely. Technology is changing the world and the legal industry is no exception. I believe that a lot more of the basic services will be automated and that LPM systems will increasingly help manage the work, make it more predictable and reduce risk. Having said that, I do not think that technology will revolutionise the legal industry the way it has revolutionised manufacturing for a variety of reasons. One of them being that a great lawyer is as much about intuition and judgement as he/she is about experience and skill. That softer side is something very difficult to handle for any machine. At least today and for the foreseeable future. Ask Siri or Alexa.

What have been the main changes in the way you charge for your work in recent years? What percentage of work is charged out with alternatives to the billable hour?

I would put ‘alternative fee arrangements’ in the same buzzword bingo as ‘innovation’. Some clients are really looking for more discounts, but AFAs definitely come into play for almost every single RFP or other form of proposal. I believe that the future of AFA is in an alternate service delivery model that gives both sides a chance to succeed. One by getting a better deal. The other by an innovative way of doing the work while preserving margins (if not revenues).

Differentiation is critical to buyers of legal services – how do you stand apart from the rest of the market?

An excellent question, something I have been thinking about (and working on) since I started. I believe there are a few things that make Venable special:

  • We are relentlessly focused on our client needs and strive to deliver the legal solution they need, not just a set of legal tasks they asked for.
  • We have a strong sense of culture and values and are unwilling to sacrifice those for mere size or revenue growth.
  • We believe great lawyers deserve a certain ‘freedom to practice’ which will give them a chance to fulfil their dream of practicing law and our clients the best knowhow applied to their needs.
  • For an AmLaw 100 firm we are surprisingly affordable (not sure that I am even allowed to say that…).

What do you think are the top three things most clients want and why?

I am just beginning to meet with our clients/GCs, but what I hear is:

  • Excellent and relevant legal expertise.
  • An understanding of their business and their broader needs.
  • A willingness to find terms that offer value for money and a shared risk in the relative investment/cost.
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