Q&A: Richard Wood - "We really frown on anyone who starts to say, 'This patch of work or this client is mine', as opposed to 'ours' "

In this Q&A, Gilchrist Connell managing principal Richard Wood discusses the challenges of running multiple offices across the country and why a firm policy on recruitment has helped the culture of the business.

As a firm that specialises in insurance law services, how is business?

“We’re going pretty well at the moment. We formed a view when we started in 2008 that if you wanted to specialise in our field, which is insurance law and defendant-side litigation, you really needed to be able to offer some of the bigger clients a multi-site, multi-product presence. So when we left our old firm (Thomson Playford) we started with offices in Adelaide and Sydney and we figured we needed to get a bigger presence around the country. That led us to open other offices, not just for growth’s sake but to be able to offer a viable business to our staff and give our clients what they wanted.”

You opened an office in Perth in 2011, in Melbourne in 2014 and in Brisbane just weeks ago. Is that bigger presence paying off?

“Well, we’ve been embarking on a deliberate strategy in that regard because that’s what we think the insurers have been saying they want – not all insurers, but certainly some of the larger ones. That has translated into a reasonably successful outcome for us and, in seven years, we have been able to pretty much triple our revenue and size. They’re not the only marks of success, but we are continuing to grow and we see further opportunities in what is a fairly competitive sector of the market.”

What makes the insurance law market different to some others?

“We are in a sector that is more or less immune from economic cycles. When the economy is booming, insurance firms are seen as the poor relations with their charge-out rates, but in the downtimes they’re seen as the goose with the golden egg because they are still chugging through the same amount of work if they’re any good. So our strategy has been a workable one for us and has delivered what we wanted, and more importantly it seems to have delivered what the insurers in the market want if their utilisation of us is any guide.”

So you have some in-built market protections?

“When we went out on our own, we elected to stick to the knitting – to maintain the specialisation in what we knew. We’re not exposed to all sectors of the market, but of course we are very exposed to the one we’re in. We formed a view that this was viable and that we should stick to that specialisation.”

Opening new offices around the country can be a challenge. How have you fared?

“There are always challenges. When we started there were four equity partners and seven partners in total that left the old firm with maybe 28 or 29 lawyers. But we were battle-hardened with the experience we had coming out of our old firm, so we were pretty tight and close. A law firm of that sort is very easy to run because all your critical decisions can be made on the back of an envelope or with a five-minute phone meeting because there’s a real element of trust. Of course, when you expand the firm it’s very difficult to keep that camaraderie or common goal, so you need to be very careful about the people you bring in … (With new lawyers) we are very careful to explain how we do business and how we want to do business. There are a lot of people we have looked at over the distance that have had quite nice practices, but we didn’t think we’d be comfortable (with them) in our organisation so we didn’t progress those discussions. We only really have one rule and that’s a no-idiots rule. So you’ve got to be the same sort of person as we are with the same sorts of goals and the same client focus and the same attitudes around developing your staff and how you treat your people. That’s what really drives our business and enables us to offer what we think is good service to some fairly sophisticated consumers of legal services.”

On the Gilchrist Connell website, you speak about the importance of a “unity of approach” by senior lawyers. Why is that so crucial?

“We’ve got a lot of senior lawyers in the firm who come from a lot of different backgrounds. A lot of firms have different approaches to how they reward their staff, including their partners or directors, and some of those models measure people in such a way as to create silos and competition within the firm. We formed the very strong view that there is enough competition externally without looking for competition internally with regard to who is doing what work and who is marking their own patch, if you like. So we have set up our systems internally to make sure that everything possible is done to mitigate against people protecting a patch of work or protecting a particular client. Now, of course, clients will want to deal with certain individuals in some cases, so the client gets what they want, but we are as serious as we can get in relation to making sure that we approach everything in a co-ordinated way and in a way that promotes the unity of the firm and the common direction of the firm. That’s everything from rewards systems to how we deal with people to how our teams internally are set up. We really frown on anyone who starts to say, ‘This patch of work or this client is mine’, as opposed to ours. All our partners are in furious agreement about that.”

What are your biggest management challenges?

“For a firm like ours that operates in a market where perhaps rates are lower than in some other sectors, maintaining viability is always a challenge because clients want better value – more for less. We have to deliver a top-tier result for a client in a way which still allows us to maintain viability. That’s a constant challenge, and a lot of firms in a lot of sectors are going to be dealing with that challenge. The other consistent management challenge is making sure you have the right people and retaining them because if you get that right then the rest of the business is pretty easy.”

Are there any new tests on the horizon?

“The new challenges involve technology and how you deliver your work and integrate new technology into your business. That’s a constant in the insurance law sector because our clients have wanted that (to be addressed) for a long time.”

So in a sense your hand has been forced to adopt technology solutions. Is that right?

“Yes, and it keeps you up with the Joneses in terms of some of the insurance providers and perhaps puts you a little ahead of the game in relation to some of the competitors who are trying to get into the market. But we are a five-site, 65-lawyer firm as we stand at the moment. If we were 65 lawyers at the one site it would be a very easy business to run, but we’re not. So you need to have systems in place that allow you to be flexible and work from anywhere and to allow your staff to work flexibly and to enable your staff to do work wherever they are required within their field of specialty. All our systems have been designed for that and we weren’t hampered with any legacy systems when we opened seven years ago. We could start anew and stay agile.”

As managing principal, do you bring any specific management philosophies to the role?

“Not really. I take the view that law firms are fairly easy businesses to run provided you are honest and truthful with the people you’re working with. We tend not to hide a lot. My experience is that most people in an organisation can find things out if they want to, so you might as well tell them up front what you are doing. The only other philosophy I have is that I don’t work particularly well to rules or to people telling me what to do, and I make the assumption that other people don’t as well. While we have the rules and policies and procedures we need, and which regulation and law prescribes that we must have, we really try not to run our business based upon those but to let people show their initiative and let people know what the target is that we are aiming at and allow them to use their own initiative to achieve that.”

What does the future hold for Gilchrist Connell?

“We still have some growth to do in some of the sites we are in. We said when we started when we had a turnover of about $6 million that we never really wanted to get bigger than $25 million turnover. That was an arbitrary figure and it was really based on the fact that we’d come out of a firm that had a level of bureaucracy and management that we didn’t want to replicate. There is, of course, a size when a business will need to bring in some layer of expertise to just run itself and we’re still exploring what that size might be. We will do what we need to do to continue to thrive as a business and to offer our clients what they require and to offer our people career choices. So common sense dictates that there must be some continued growth in the business, but we have no real desire to take over the world. Our immediate growth strategy is to consolidate the new offices we’ve opened in the past 15 months and to maintain the rage in the other three.”