Lawyers Who Don’t Create Serve at Their Peril

Former hedge fund manager and author Andy Kessler takes aim at jobs at risk from technology in an op-ed piece in today’s Wall Street Journal. And he manages to find lawyers in the crosshairs. Since CEOs and CFOs read the WSJ, you should, too.

Mr. Kessler’s main distinction in the new economy is between creators and servers. It’s no surprise you don’t want to be in the latter, but that’s where he squarely places lawyers:

Servers, on the other hand, service these creators (and other servers) by building homes, providing food, offering legal advice, and working at the Department of Motor Vehicles. Many servers will be replaced by machines, by computers and by changes in how business operates.

Ouch. He had to lump us in with the DMV.

Not content with the generic “servers” tag, Mr. Kessler further sharpens his pencil. The sub-category that snares lawyers: sponges:

Sponges are those who earned their jobs by passing a test meant to limit supply. According to this newspaper, 23% of U.S. workers now need a state license. The Series 7 exam is required for stock brokers. Cosmetologists, real estate brokers, doctors and lawyers all need government certification. All this does is legally bar others from doing the same job, so existing workers can charge more and sponge off the rest of us.

Rather overbroad, to be sure. I hope most lawyers can provide more value than a make-up artist, but who knows these days?

Mr. Kessler then shows that he knows something about the legal field, probably from litigation in his hedge fund days:

But eDiscovery is the hottest thing right now in corporate legal departments. The software scans documents and looks for important keywords and phrases, displacing lawyers and paralegals who charge hundreds of dollars per hour to read the often millions of litigation documents. Lawyers, understandably, hate eDiscovery.

I know more than one GC who would dispute that eDiscovery necessarily entails lower costs.

Mr. Kessler has seen a lot of technology-driven trends before others, and his writings, while sometimes controversial, are always thought-provoking. More of them are available at his blog here, which has links to his books. (His new book is “Eat People: And Other Unapologetic Rules for Game-Changing Entrepreneurs.”)

Lawyers can be creators. In the current model of delivering legal services, many aren’t. Yet most law firms want to price servers the same as creators. Many agree what is happening with that.

But if Mr. Kessler really thinks that technology is a relentless driver of change, he’s probably never tried selling legal technology solutions to law firms or legal departments. Ask someone who has, preferably over a drink that you have provided.

And while I obviously believe change is here for the law, I think it’s coming to legal technology as well. It might bring new meaning to the term client/server.

More on that next week.

(Can you spot the lawyers? What was once left may now be right.)

Would you like a memo with that?