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The Singapore Law Gazette

Your Business Continuity Plan is Implemented – What’s Next?

The COVID-19 pandemic is a crisis unlike any other we have experienced in recent memory. It ravaged with such intensity that all businesses were forced to implement business continuity plans (BCP) with unprecedented speed.

After the initial shock of scrambling to cope with this unexpected serious pandemic, law firms are now in unchartered waters. How the crisis will play out is still being studied and debated. Currently, the consensus among medical and economic experts is that the crisis is unlikely to blow over soon. Governments around the world, including Singapore1National Development Minister Lawrence Wong warned of “marathon battle against coronavirus” and “to expect more challenges ahead” as Singapore “was not yet out of the woods” on 4 May 2020 in a statement delivered in Parliament., are bracing for a long battle.

This article discusses how law practices can assess the pandemic’s impact on Practice Management, Human Resources (HR), Business Development and IT/Operations and take steps to build resilience and mitigate new and emerging risks.

The pandemic is all about uncertainty. There is no precedent or blueprint on how to manage the social and economic fallout. The charting of any course to navigate this crisis needs to be guided by an understanding of the unique characteristics of COVID-19.

The Unique Nature of COVID-19

COVID-19 is a lethal coronavirus that has spread like wildfire around the world. Because it is a novel strain, there is currently no effective vaccine and medical experts cannot predict how it will behave as it infects the world population.

It has led to governments around the world responding with policy decisions that radically change the way we work and live. This has in turn caused the world economy to go into a tailspin with other grave psychological and social consequences.

The impact of COVID-19 will be extensive. After more than three months since Singapore’s first known case, the medical community is still trying to understand COVID-19 and its effects, which are constantly evolving and fluid.

Consequently, social and economic measures are often in a state of flux because they need to be updated frequently to sync with emerging new medical findings.

While there are optimistic epidemiological and mathematical models on when the virus will peak, much depends on prevailing unknowns about the virus and on what people and authorities do. Changing seasons could affect viral transmissions, as could degree of immunity attained by individuals, which could be permanent or temporary. An infection may appear to be under control today but a new cluster may surface the next.

The World Health Organization (WHO) has urged countries lifting lockdowns to proceed with caution and to be prepared to restore the restrictions if the virus re-surfaces.2WHO statements on 1 and 7 May 2020 (Straits Times 8 May 2020 “WHO warns against rushed end to lockdowns”). Infectious disease experts have also warned it will be difficult for the world to contain the pandemic because the virus will be at various stages of spread and infection in different countries.

The Three Phases of the Crisis

Phase 1. Business continuity

This is the triage stage and BCP measures are focussed on the health and safety of employees and minimising business disruption. As at the date of this article, Singapore is transitioning between Phase 1 and Phase 2.

Phase 2. Building resilience

This is a phase when initial panic of the pandemic would have faded, with infections levelling off and governments cautiously unwinding lockdown measures and border controls. Most business activities will proceed with hesitation as there will be concern over new virus outbreaks which will inevitably be accompanied by the restoration of economic and social restrictions.

This is the time to explore innovation, strengthen relationships and assess how best to be positioned for Phase 3. Analyse market demand by practice and industry3Business Times 6 May 2020 “Singapore law firms tighten purse strings, adapt to changes in demand”. and offer creative ideas to help clients meet their business challenges. Senior management should take affirmative action to engage with partners and employees.

Phase 3. Recovery

When it is officially recognised that the virus is under control and an effective vaccine is available, full economic activities will resume. Investments and process improvements made during Phase 2 will be apparent in this phase.

Beyond BCP – Building Resilience

Practice Management

  • Continually assess the firm’s financial performance and cash flows using multiple scenarios. Communicate and manage the expectations of partners and the rest of the firm.
  • Take steps to realise all possible benefits from COVID-19 stimulus packages.
  • Work with practice leaders to monitor key performance indicators for demand, productivity and pricing under remote working conditions.
  • Ensure the appropriate partners are staying in contact with each of the firm’s top clients.
  • Ensure the quality of the legal services provided stays at least at pre-COVID-19 level, particularly response times.
  • Review experiences with remote working and which aspects can become permanent features of the law practice. Then take steps to institutionalise remote working into firm policies and procedures.
  • Assess market positioning and competitive landscape and consider developing unique and valuable virtual services to clients and prospects.
  • Assess viability of major cost-saving operational concepts such as reduced office space needs (based on a segment of the firm working remotely) and whether the firm could benefit from a rethink of real estate footprint.
  • Begin expectations management around likely outcomes for the year, particularly with key partners.
  • Deliver carefully crafted message on how COVID-19 related productivity declines will be considered and evaluated. Provide comfort around job security wherever warranted.
  • Assess whether there is a need for a different talent model for example, “lawyers on demand” model for specific matters or tasks.

HR

  • Continue to ensure that all essential staff who are required to be in any office are protected and are following all guidelines relating to COVID-19. 
  • Keep firm leadership one step ahead of developing situations (in relation to COVID-19 guidelines) so that approval for specific actions can be obtained from management quickly.
  • Rethink lateral and other hiring strategies.
    • Create formal virtual processes for screening, onboarding, and integration of employees.
    • Rethink staffing needs based on changes in demand patterns for various practices.  Assess where current personnel can be cross-purposed.
  • Formulate a formal summary report to management on the firm’s culture and how the lawyers and staff handled the transition to working virtually.
  • Get performance reviews back on schedule and update the evaluation to include the ability to work and contribute remotely.
  • Work with management to develop communications strategy around any messaging needed in association with year-end bonus, salary and promotion decisions impacted by COVID-19 events.
  • Rethink performance criteria and develop new metrics to evaluate contributions in the new normal business model.

Finance

  • Support management’s key task to continually assess the firm’s financial performance and cash flows using multiple scenarios.
    • Regularly provide management with updated budgets and scenarios including a worst-case assessment.
    • Ensure client concessions are done thoughtfully so the firm does not get stuck with a permanent below-market discount.
  • Assess profitability of the firm should it continue to operate virtually even when the offices are open and make the appropriate recommendation(s) to management.
  • Review the performance of practices with respective practice leaders to evaluate trends over time (i.e., pre-virtual, early virtual, later virtual, at the onset of recovery):
    • take any immediate corrective measures; and
    • draw up medium to long term plans that focus on rates, productivity/staffing needs in relation to current and projected demand, realization, client payment timelines and team profitability and make appropriate recommendations(s) to management.
  • Examine the firm’s capital base and the related impact on the firm’s profitability during the major pay-back periods.
  •  

Marketing/Business Development

  • Ensure the firm stays visible and produces the appropriate market messaging around the pandemic, including the firm’s unique position in serving the needs of the market.
  • Assist partners with staying connected to the clients by proposing strategies that differentiate the firm’s content marketing from the deluge of COVID-19 related materials generated by law firms.
  • Instead of developing marketing or thought leadership materials on every topic, think of ways to provide clients with targeted and insightful marketing collaterals.
  • Work with management to budget for key client visits, when practical to execute.
  • Consider how to re-allocate marketing budgets previously allocated for client-facing events to other virtual activities.
  • Work with partners to assess the strength of client relationships to determine the following:
    • Likely demand for the remainder of 2020 and all of 2021.
    • New or rapidly developing areas of client service that did not exist prior to the pandemic.
    • Declining areas of client service that were strong prior to the pandemic.
    • Prospective clients based on partners hear in the market.
    • Recommend action steps and related budgetary requirements.

IT and Operations

  • Continue to ensure that remote working technology works optimally without further significant investments.
  • Continue to work with HR to ensure that all essential staff who are required to be in any office are protected and are following all guidelines relating to COVID-19.
  • Remind management of any leases due to expire within two years.
  • Start to formulate recommendations to management on any major adjustments or recommended investments in the technology platform and remote working environment.
  • Carefully coordinate the re-opening of offices with management and the partners.
  • Assess the benefits and risks associated with outsourcing any non-core support services that are still maintained by the firm.

Tomorrow’s Law Firms

Embracing Legal Technology is Not That Difficult

The coronavirus pandemic has turbocharged the transformation of the legal industry, especially in its adoption of technology. In a matter of weeks, law firms and even courts4Straits Times 25 April 2020 “Courts to hear only essential, urgent cases till June 1” reported that Chief Justice Menon gave an update on the number of court hearings that have been conducted in the past weeks using remote technology such as Zoom. In the week of 20 April 2020, there were 23 trials at the Family Court, 33 hearings at the Youth Court, 17 pre-trial conferences, 28 plead-guilty mentions and 99 other mentions at the State Courts. The Supreme Court has fixed 19 remote hearings and on 23 April 2020, the Court of Appeal delivered judgement via Zoom. The Court of Appeal also scheduled two remote hearings in the week of 27 April 2020. were able to move away from entrenched methods of operations and practices with astonishing speed, ease and acceptance.

This has indeed cast a positive light on the legal profession, often associated with being inward looking, risk averse, relying mainly on precedents, and outdated in how it operates and delivers legal services.

How the legal profession dealt with the coronavirus pandemic has demonstrated its agility and responsiveness to clients and practice and ability to make quick decisions even when working remotely.

Past crises such as the Asian financial crisis in 1997, the dot.com bubble burst in the early 2000s, the global financial crisis in 2007/08 and even SARS did not result in any fundamental systemic change to law firm operating models. Law firms responded with the typical cautious belt tightening, batten down hatches and expectation to return to “business as usual”.

It is interesting to note how the unique circumstances unleashed by the pandemic accelerated the legal profession’s ability to swiftly harness the potential of underutilised technology tools and embrace alternative work arrangements that they have long resisted.

It has always been an uphill task for law firms to get lawyers to convert from tried and tested methods to new ones, making the pace of actual innovation slower.

Law firms should continue the momentum of embracing new ways of working to explore ways to sustain innovations that have been adopted during the crisis. An example would be the use of communications technology tools which have proven that remote meetings are just as effective as in person meetings at a fraction of the cost and inconvenience.

Working Remotely is Okay and it Mitigates Risk

Law firms in general have put in place fundamental information technology tools that enable people to work remotely. The pandemic “normalised” working from home (WFH) when it forced a shift to a totally remote workforce in law practices.

WFH has shown that most lawyers do know how to operate remote working tools and can deliver legal services effectively and quickly, without physical office face time. This is an important risk mitigating measure since it ensures business continuity.

Remote working has highlighted many inefficiencies in law firm operations, resulting in many fixes on the fly by law firms. Some of these quick fix solutions may actually be used as solutions for future innovation and efficiency.

Now is the time to review collaboration and data integration tools and WFH protocols. It is the time to explore ways to improve remote working so that processes can be improved to allow people working remotely to operate as teams and at the firm’s quality standards.

WFH allows people to balance work and life although issues with trying to get work done in kitchens, either in total isolation or surrounded by family members cannot be discounted.

Perhaps WFH could be used as a catalyst to reflect on how to manage the well-being of lawyers and the challenges of client pressures.

Press the Reset Button

Will we get past this and go back to business as usual?

Or will we finally get to a stage of “new normal” with a legal industry that taps on the potential of technology with new legal service models and processes that endorses flexible work arrangements, promotes work life balance and a culture that is less hierarchical, less corporate and more informal?

My personal wish is for the latter and we consign how law firms operated in the first two months of 2020 and before to nostalgia.

* Statistics and information given in this article are accurate at time of publication.

Endnotes   [ + ]

1.National Development Minister Lawrence Wong warned of “marathon battle against coronavirus” and “to expect more challenges ahead” as Singapore “was not yet out of the woods” on 4 May 2020 in a statement delivered in Parliament.
2.WHO statements on 1 and 7 May 2020 (Straits Times 8 May 2020 “WHO warns against rushed end to lockdowns”).
3.Business Times 6 May 2020 “Singapore law firms tighten purse strings, adapt to changes in demand”.
4.Straits Times 25 April 2020 “Courts to hear only essential, urgent cases till June 1” reported that Chief Justice Menon gave an update on the number of court hearings that have been conducted in the past weeks using remote technology such as Zoom. In the week of 20 April 2020, there were 23 trials at the Family Court, 33 hearings at the Youth Court, 17 pre-trial conferences, 28 plead-guilty mentions and 99 other mentions at the State Courts. The Supreme Court has fixed 19 remote hearings and on 23 April 2020, the Court of Appeal delivered judgement via Zoom. The Court of Appeal also scheduled two remote hearings in the week of 27 April 2020.

Angeline has been in the legal profession for 30 years. She practised corporate law before her current specialisation in risk and knowledge management, where she was department head for two leading law firms.