Accountants: the Second Coming? Keep an eye on innovation at the periphery

A very interesting piece from Ed Reyes in the Gazette wondering if Richard Susskind is right to predict accountants will provide serious competition in legal services in the near-future.  Ed ends by saying this, “Are the accountants coming? In some areas, they probably are. But the window they had to revolutionise the legal sector has surely passed.” I am not at all sure.

I’ve read Richard Susskind’s new book too.  I’m speaking at a launch event next week so I won’t rehearse my full thoughts here.  I do agree this is one of the stand out predictions but I think Ed is wrong to underestimate the potential for change.  Accountancy firms would be unwise to set up law firms or law and accounting firms and seek to compete with large firms head on, but that (to my mind) is not how innovation is likely to work.

What is more likely to happen is Accountancy firms will work their law related niches and build on those.  Approaches that they develop in their niche fields may then persuade them and their clients that there is merit in expanding.  Who knows where this will lead?

Accountancy firms are ahead of the curve on things like risk analysis and big data for instance.  This week the FT covered Ernst and Young’s compliance analytics, which can trawl emails for signs of compliance and ethics problems.   Law firms don’t yet grasp what this has really got to do with them, or when they do, how they can turn those issues into serious business opportunities.  The level of investment and the range of skills involved in such projects may also be beyond what is normal for most if not all law firms.  Yet I suspect it is not a million miles away from the kind of thing e-discovery systems do.

The way in which costs analytics is leveraging the role of inhouse counsel is one signal of change which is likely to lead to a quite different approach to lawyering and will spread beyond its current sphere of influence.  Currently it leads to the questioning of costs.  The approach may well morph (is already morphing) into a questioning of value.  It should be a warning for lawyers as to how innovation starts at the periphery and, where successful, moves towards the centre stage.

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