“Innovation doesn’t magically happen”: Why Reed Smith’s innovation hours programme should be applauded

Legal IT Insider speaks to innovation hub manager Alex Smith and London managing partner Andrew Jenkinson about Reed Smith’s innovation hours programme, which recognises up to 50 innovation hours towards billable-hour targets for fee earners.

“Innovation takes time, it doesn’t just magically happen,” Reed Smith’s London-based innovation hub manager Alex Smith tells us, commenting on the announcement that the global law firm will in 2018 recognise up to 50 innovation hours towards billable-hour targets for fee earners.

The move follows a successful pilot in 2017, which saw seventeen lawyers dedicate 364 innovation hours to six selected projects. London managing partner Andrew Jenkinson tells us that the firm hasn’t calculated any impact of the programme on its bottom line, commenting: “This is more holistic than that. What it’s really about is improving the quality of our services and our output and making sure it’s top drawer, which is incumbent on all law firms. If you get it right, you’ll be more attractive to clients and win better work and better deals, it’s not a binary thing.

“It’s about enabling the talented people to direct their talent and resources to producing the best quality output; a kind of ‘build it and they will come’ approach. It’s also about attracting and retaining the right talent.”

The pilot ran from January to December 2017, at the start of which lawyers across the firm (see the list of participants below) were invited by chief knowledge officer Lucy Dillon and Smith to submit their ideas.

From 30 idea submissions, six were selected due to a combination of criteria, including creativity, client focus, efficiency, alignment with the firm’s strategy and cultural change.

“One person or a group of people – we’re interested in projects – look at an idea or problem or more specifically start to think about a client problem and we give them time to think and solve it,” says Smith.

Time to think sounds fairly enviable in any world and Smith adds: “Within law firms the issue is around time and this issue is about giving people time and connecting them at Reed Smith with people who can help solve things with a light framework around that.

“We’re creating a solution which involves thinking through the problem, having time to discuss it, and coming down to the best approach whether short or long time. Giving people time leads to better conclusions.”

Innovation initiatives are becoming the norm in Big Law but this one – connected as it is to still hugely precious billable hours (let’s not get distracted by the fact that firms are still wedded to billable hours) – has teeth. It both gives permission to and incentivises lawyers from across the firm and at different levels to engage, which means, among other things, that lawyers who would otherwise leave to set up legal tech startups (we meet them regularly) are less likely to do so.

While there is no doubt a place for arm’s length innovation committees, here the lawyers who experience client problems first hand have a direct channel to help solve them and the value of that should not be underestimated.

Smith says: “You’ve got to engage the people who know their client and practice groups. I can run a session on what’s a good idea, but they are the ones who know how things work now and how they can be improved.”

Before we get too gun-ho and start painting a picture of people running around maverickly innovating all over the place, Smith is keen to stress that there is very clear process in place to not only bring to light different ideas but bring together diverse teams of people and put in place deliverables and what success looks like.

In 2017, among the pilot projects was Reed Smith’s successfully launched Breach RespondeRS app. The app was developed by lawyers in Reed Smith’s IP, tech & data group collaborating with members of the firm’s knowledge management, IT, practice innovation and business development teams. Others included document automation and working on a blockchain project, including a response on behalf of the U.S. Chamber of Digital Commerce to the EU’s ‘Opinion on Blockchain’, as well as a blockchain whitepaper (Keri Larsen, co-head of the FinTech team said: “Due to the firm recognising innovation hours towards billable targets, we were able to recruit top-talent lawyers to contribute to these projects, while also increasing their exposure to new tech.”)

Going forward, five projects with direct client involvement or impact will be selected for a fast-track 12-week programme.

Legal consultants Janders Dean are working with Reed Smith on projects that are about client cocreation, where the client is embedded in the project. “They are trying to build a real framework for that,” says Smith.

As Baz Luhrmann might say if he ever had cause to turn his mind to legal technology, trying to meaningfully measure and compare innovation initiatives right now can be as effective as trying to solve an algebra equation by chewing bubble gum. But this programme stands head and shoulders above many and should be applauded.

The lawyers involved in the pilot included:

Carolyn Chia, legal consultant, Energy & Natural Resources, Resource Law LLC, Singapore

Gerard DiFiore, partner, Global Corporate Group, New York

Terrence Fairfield, associate, Global Corporate Group, New York

Elizabeth Farrell, partner, Energy & Natural Resources, London

Matthew Gorman, partner, Energy & Natural Resources, Singapore

Pino Juliana, associate, Energy & Natural Resources, London

Kari Larsen, counsel, Energy & Natural Resources, New York

Gerald Licnachan, counsel, Energy & Natural Resources, Singapore

Angela Lu, associate, Global Corporate Group, New York

Alexandra Lucas, associate, Complex Litigation, Chicago

Mark Melodia, partner, IP, Tech & Data, New York

Marilyn Mollet, associate, Complex Litigation, Pittsburgh

Tania Teng, associate, Shipping, Resource Law LLC, Singapore

Philip Thomas, partner, IP, Tech & Data, London

Roberta Torian, partner, Financial Industry Group, Philadelphia

Anne-Marie Trachmann, associate, Energy & Natural Resources, London

Kate Whelen, associate, Energy & Natural Resources, London