Apr 2014

Guest blogger Dr Alannah Johnston, Research Fellow at Cardiff University, thinks that law firms need to simultaneously improve efficiencies by refining process and innovate to meet new challenges. She asks – can this be done?

When most of us think of ambidexterity we think of being able to use both our right hand and left hand with equal ease and dexterity. The metaphor of ambidexterity has been used in management and strategy research for the past 10 years or so, and has gained huge interest among business academics. It’s argued that successful firms need to be aligned and efficient in their management of today’s business demands while simultaneously adaptive to changes in the environment.

What are ambidextrous businesses?

Put simply, organisational ambidexterity refers to a business being able to simultaneously exploit its current capacities and markets, while also searching for new and more radical ideas. So innovation is both incremental, while at the same time allowing for new and possibly more challenging ideas and processes to emerge. Of great interest for management and strategy researchers is how to balance these two processes.

To be ambidextrous, organisations need to reconcile internal tensions and conflicting demands. On the one hand, the organisation seeks stability, refinement and efficiency, while on the other it seeks experimentation, variation and novelty. The problem is, how do organisations balance these two seemingly incompatible ideals? Most research seems to suggest it’s achieved through the organisation’s structure (e.g. develop an R&D team that focuses on the more radical ideas), its culture (divide groups up that focus on specific tasks but make sure everyone is working towards the same goal) or ‘good leadership’. In the time I’ve been researching ambidexterity, I would say it’s probably achieved through all of these things… and more. It’s the ‘and more’ I’m interested in!

Does this apply to law firms?

So, how does any of this apply to law firms? Well, since researching the legal sector and looking at the ways different firms have responded to the various environmental and legislative changes that have taken place, it seems very few are what I’d call ambidextrous. The most innovative responses I’ve seen so far are either creating a spin-off or particular division of the firm that processes high-volume legal services, and/or the firm branches out into other business areas such as management consulting. I certainly don’t want to denigrate these approaches as these types of business models have proved to be successful for these firms.

However, there are two issues at work here. Either business academics have come up with an idea that simply doesn’t translate to professional services (particularly the legal sector) and is more applicable to products (as the majority of research on ambidexterity focuses on, despite arguing that all organisations need to be ambidextrous in order to survive).

Or, law firms seem unable to combine incremental innovation alongside taking risks and exploratory endeavors. Yes, lawyers are a conservative bunch…or so we tend to believe. But does this really explain why there are such risk-averse business models in the legal sector? Is it purely because of the apprenticeship model in law firms? Can a law firm really operate ambidextrously and both exploit and explore?

And, if so, how might this be achieved?