Part 1 of this three-part post described software engineer-turned-attorney Jason Barnwell’s introduction — two months into his first law job after graduating from USC Law School — to the legal profession’s idea of “productivity”.
As the junior lawyer on a deal team, he offered to automate the process of creating and collating the shareholder consents necessary to close an M&A transaction by “some basic scripting”. As he put it in an article published earlier this week: “I was still an adequate software engineer back then”.
My guess is that his skills were in fact more than “adequate” — with four years of software engineering experience in the Bay Area — and a mechanical engineering degree from MIT.
Anyway, Jason Barnwell reasoned that reducing the individual bodies required for this paper shuffling from six down to one would be a good thing. Ditto the fact that the five team members thus freed up would be able to, “focus on other aspects of the transaction rather than walking laps in an ozone filled copy room”.
He was rebuffed — without explanation. Pressing for an explanation he was again rebuffed. Undeterred, Mr. Barnwell resolved to “revisit this for the next M&A deal”.
He remained undeterred until six weeks later:
“I saw the itemized bill for the transaction … There was a line item for my contribution. My hours worked multiplied by my billable rate. My client paid a lot for me to make copies“.
The legal profession matter-of-factly defines “productivity” as the number of hours an attorney billed the client and then got paid for.
See my blog post from last year: “Another Reason Business People Need to Manage their Attorneys: The Legal Industry’s Definition of ‘Productivity’ Drives Unnecessary Work”. As recently as two weeks ago, in their 2019 Report on the State of the Legal Market, Georgetown Law School and Thomson Reuters Peer Monitor repeated the same definition of “productivity”: “Hours worked per month, per lawyer”.
Meanwhile, for the business owner, general manager — or software engineer — “productivity” continues to mean units of output divided by units of input.
Jason Barnwell’s encounter with the legal profession’s definition of “productivity” prompted a change for him:
“We respond to the incentives we are offered … On a personal level, my intrinsic incentives were not aligned with the traditional and accepted law firm construct. I had to find a place to practice that rewarded efficiency.
“That saddened me because my firm was wonderful. I enjoyed our colleagues, our clients, and our work. Brilliant practitioners taught me. They showed me how to sharpen my lawyer knife … They cannot know my gratitude for their investment in me. But I could not un-see the value misalignment, and I saw no path to changing the system from within. I joined Microsoft’s legal department because I believed I could build my practice in a way that aligned with how I want to deliver value.
Two observations about Mr. Barnwell’s move from the law firm environment to Microsoft’s law department.
First, he correctly concluded that, “I saw no path to changing the system from within”. Law firms — for the most part — are not driving efficiencies by adopting technology (see this past post here). And — for the most part — they’re holding on tight to the billable hour as the basis for charging their clients (see past post here).
Second, by going to work for the Microsoft legal department Jason Barnwell not only chose to join a leading law department — but one that’s renown for innovation.
Notably, Microsoft announced in August 2017 that it was aiming to move 90 percent of legal work done by its law firms to “alternative fee arrangements” — a phrase that refers to a charge that’s not based on hours billed by an attorney.
A blockbuster announcement to a legal industry still largely governed by the billable hour. In so doing Microsoft joined a tiny group of leading companies that have made this choice (e.g., BASF, GlaxoSmithKline).
In an article he published earlier this week, Jason Barnwell offered insights into what it means for a lawyer to work for an organization that values the more conventional definition of “productivity” over the definition that still holds for most of the legal profession.
We consider those insights in Part 3