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Q&A: Trevor Edmond – "If we all do the right thing, then we won't need 800 policies and procedures"
In this Q&A, Wallmans Lawyers managing partner Trevor Edmond discusses the state of the legal services market in Adelaide; why psychometric testing has been crucial for the firm’s recruitment strategy; and what challenges are around the corner.
How are conditions for law firms in the Adelaide market?
“Slightly better than they were several months ago. Last financial year, ‘flat’ would be as good as you could have described the market. It’s a very mature market and legislative changes, which have shut down more and more representative work in courts, have had an impact on litigators. On the commercial side, transactions also slowed down. The combination of the federal election and some uncertainty around the state and where it’s going has meant that confidence isn’t sky high, which has affected what people are planning to do.”
So what does that mean for a multi-practice commercial law firm such as Wallmans, which has a history dating back to 1908 and staff numbers today of more than 80?
“Thankfully, we see that Adelaide still has a place for a mid-market firm. We are one of the larger firms that are solely South Australian and a diversity of practice has given us a level of insulation. I’m not saying that times haven’t been tough, but to some degree spreading the load across a number of sectors has allowed us to weather the storm reasonably well. It has led to a position at the end of the last financial year where growth, and therefore growth in profitability, was not phenomenal after having had some significant growth a couple of years earlier. But there is still a level of optimism within our firm about the future and we are looking internally and externally about where we can grow.”
A few years ago the influx of major international firms into Australia raised fears about the ongoing strength of state-based firms. Are those concerns settling down now?
“The reality is that the introduction of international firms into the Australian market didn’t and still doesn’t have an immediate impact in South Australia. We don’t have the offices of King & Wood Mallesons, Ashurst and Norton Rose here and it’s unlikely that that’s going to occur. Sailing under that radar means we haven’t had that direct competition.
“Where the issue arises, however, is that some of the ‘other’ firms have decided that they need to be national to either differentiate themselves or to compete. So, for example, the highly publicised introduction of HWL Ebsworth into the South Australian market, and how it has been looking to increase market share in certain areas, has been one of the biggest changes here. Then there are a number of firms that have emanated from South Australia and spread out to become national firms – the likes of Thomson Greer, Piper Alderman and, in insurance, Gilchrist Connell. So while we have not had the immediate impact of those larger international firms, there has been an interesting knock-on effect in the South Australian market.”
How do you respond to such competition?
“You’ve got to constantly keep your relationships going. We are probably as parochial as the Victorians. A lot of the work in Adelaide is built on relationships and that was part of the issue when one or two firms did try a while ago to move into the Adelaide market. It’s very hard to come into this market cold without having people who have built relationships. It’s about constantly working and developing your relationships to maintain or increase market share. You also probably have to be a little bit smarter and look to laterally hire individuals to move in and augment areas for your firm. Our focus has always been on those people who have relationships, as opposed to someone who may be technically brilliant but who is not necessarily a marketer.”
So despite all the discussion in the legal sector about disruption and technology, the old model built around relationships is still relevant. Is that right?
“To a degree. A lot of the belt-and-braces work, a lot of the repeat work, can now be done anywhere in Australia. If a client needs a trust deed, they can set it up anywhere. But what firms must do is develop relationships to be able to get in front of people to talk about why they may need that document, or more importantly why that document is necessary in the greater scheme of things. As changes occur and as we head towards some level of commoditisation, relationships – as old-fashioned as some people may think they are – are actually more important.”
Along with 10 other Wallmans lawyers, you made the Best Lawyers in Australia list again this year. How do you balance your practice work with the role of managing partner?
“It’s difficult to get the balance right. Luckily, I have some very good younger members of the firm who have worked with me for a number of years. The Best Lawyers recognition for the past couple of years is probably more of a reflection of the good people I have working with me, but I just manage to get the kudos.
“There are times when one role will overtake the other, so it’s about having a degree of discipline in relation to those matters and trying to make sure you are spending the correct amount of time on both tasks. I don’t know that we are big enough to make the MP’s role a fulltime role, especially when we have a management structure that isn’t quite ‘set and forget’ but one which allows us to leave a lot of the tasks to our very good managers.”
What management philosophies do you bring to the firm?
“First and foremost, it is to lead by example. You cannot ask others to do what you are not doing or being seen to do yourself. I adopt a hands-on approach in dealing with matters – sometimes I’m told by my fellow partners that I’m a bit too hands-on. You need to get the balance right between allowing others to be involved in decision-making processes, but having that obligation as managing partner to ensure that everybody is on the same page. In relation to visions and values, I would just love to have one statement or policy for the firm, which is ‘Do the right thing’. If we all do the right thing, then we won’t need 800 policies and procedures.”
Getting good lawyers to join firms can be tough in a competitive environment. What do lawyers want?
“They want an adequate level of remuneration for what they are doing and, at the higher level, for the risks they’re taking as a partner or as an owner. Getting the right people into a firm should not be an issue. What is a big issue for us, though, is the question of the philosophy of the firm and ensuring that the people we bring in do not change our culture and philosophy – rather, they are aligned to it.”
How can you ensure that alignment?
“At Wallmans, we do not take anybody on – whether it’s a potential new partner or a potential new solicitor – until they have gone through some psychometric testing which we organise. Everybody in this firm will go through that process to see if they fit with the philosophy of the firm, and more particularly that they will fit into their relevant work area. We didn’t do this previously and we’ve been burnt. Since adopting this approach and getting everybody to embrace the result, we are finding it a lot easier to ensure that people who need to work together do work together because they understand each other.”
So technical talent alone is not enough to score a job?
“No. Do you take someone on board because they are a brilliant fee earner and have talent, but who might be toxic to your culture? Thankfully, the decision we have taken is ‘no’. There are a number of people who have approached us who just don’t pass that first test. As the gatekeeper of that philosophy, if I indicate to partners that I have spoken to a potential recruit and they’re not acceptable, that’s accepted.
“We have also adopted arranging a final session during the recruitment process where all partners get to meet the potential new person. If you are going to be in this firm all the partners need to know who you are. I don’t want to have a position whereby I’ve just hired somebody who happens to be the next-door neighbour in a dispute with someone at our firm. It’s about having everybody singing from the same hymn book.”
The firm supports disadvantaged children, in particular, as part of its community programs. How do you make a difference?
“We decided a few years ago that rather than spending money on Christmas gifts, we would vote for a ‘charity of choice’ each year. What otherwise would be the dollar spend on client gifts and presents is now donated to a charity. We ask our people each year to suggest possible recipients. The board shortlists three charities and then the firm determines which one it wants to back. We want to give back to the community. We can be a little cocooned in terms of who we deal with through our work and clients and seeing what goes on in the community can be an eye-opener.”
About six years ago, Wallmans opted to move from Wakefield Street – where it was part of the city’s busy legal hub – to modern premises in King William Street offering proximity to the courts and greater parking and accessibility for the firm’s clients. How has this move to decentralise, a trend among some firms, panned out?
“The move to the new premises has been fantastic and it was driven by the fact that we were previously in a block of four or five buildings. It’s very hard to drive a one-firm attitude if people are in totally different buildings. The move slightly away from the CBD was also driven by client needs – to ensure that we had adequate facilities for clients to get to us and to allow interaction with clients and others in the community. It’s given us the ability to offer the use of our boardroom to a number of our clients, and a charity group has an awards night here. We want to allow others to use the facility. It’s allowed us to open up and look at how we can provide value-add and work with our clients.”
Your firm has a history dating back more than 100 years. What does the future hold?
“Historically, we have had a very strong plaintiff litigation practice. Across the board it seems that litigation is declining, so it will be interesting to see whether this trend persists and what that will mean as we to continue to bolster our corporate and commercial practice. The biggest challenge will be around the potential merger of accountancy and legal practices in Australia and how that will impact firms, particularly in the SME market, which is a fair part of the South Australian legal sector. It’s one of the biggest uncertainties that we have here in South Australia.”
Do you have any final messages for your peers?
“The profession is facing the most challenging period I’ve seen in more than 30 years of practice. But we should be excited by challenge and change rather than be scared of it or ignore it. Change is only going to get more rapid and greater for firms. For me, that’s exciting and makes me want to be part of it still. If you put your head in the sand, you leave something exposed to be kicked constantly.”