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Law360 (August 14, 2019, 1:40 PM EDT)

According to Elliott Portnoy, global CEO of Dentons, the 6-year-old international megafirm never set out to be the largest in the world by headcount, but it’s worked out pretty well and there is no intention of slowing down.

Elliott Portnoy, Dentons global CEO

“We’re continuing to grow in 2019,” he told Law360. “Continuing to innovate in some pretty exciting ways. Continuing to scale our efforts in ways that we think will continue to redound to the firm’s and our clients’ advantage.”

Portnoy spoke to Law360 recently about the rapid growth of the firm, its unique approach to integrating and managing new practices and the future of the legal profession. This interview has been edited for clarity of length.

Any conversation about Dentons has to begin with its growth. What’s the strategy animating that growth, and do you expect it to ever change?

In short, the strategy is unlikely to change. But we didn’t set out 10 years ago to be a law firm of 10,000 lawyers. At the time, I had the privilege of leading the firm that was then Sonnenschein Nath & Rosenthal, a firm of great history, values and people. But 10 years ago Sonnenschein, which was an outstanding firm, was becoming more and more indistinguishable from other firms and in danger of losing key clients and talent. So we embarked on a strategy to differentiate our firm in the marketplace. As a byproduct of that strategy [we have grown] in ways that no other law firm in history has ever achieved. Starting with the roughly 500 lawyers that we had back then, we now have over 10,000 attorneys practicing in 176 offices in 79 countries. And the punchline is the strategy is working. And so we’re doubling down on that strategy. We’re staying true to it.

Even a firm with only a few hundred lawyers with offices spread across the U.S. will face challenges as far as maintaining cohesion and a shared culture. How do you it across the entire world with this many attorneys?

It starts, I think, with having a very clear agreement in your strategy. So that as you grow, the pieces of the firm that are coming together each time create a new firm where there’s very strong alignment on what the firm is, and how we’re going to do business. I would suggest that today with our 176 offices that we are more aligned as a global law firm than we were 10 years ago, when we were only doing business in one country, albeit in a number of different markets in that country.

When we grow, as we’ve continued to do in 2019, we’ve never gotten a vote of our partners of less than 96%. And that’s for every transaction that we vote on to have a combination around the world.

I’ll give you a quick example. The latest combination that we announced was with an elite law firm in Zimbabwe, and many law firms would take the position that that’s in a distant place, and only the partners in the Africa region should vote on that. We do it quite differently. When we made the decision just a few weeks ago to combine with this elite firm in Zimbabwe, every partner around the world was given access to a secure partner information site to learn about the firm, and all partners voted on it. So whether it’s a significant combination in an existing market, like the U.S. or Canada or the U.K., or instead a new market in an existing region, whether in Africa or Latin America, everyone votes on it. And the result is everyone has a stake in the success of that particular part of the business, and it helps with the cohesion we require to deliver on the client proposition.

When you approach these localized firms, what’s the pitch to them? Why should they want or need to become a part of Dentons?

It’s really the same whether it’s Hawaii or Malaysia or Zimbabwe or Peru. These are outstanding firms that, in their own markets, are the elite choice for litigation, transactional, regulatory and other work. But they are trapped by geography and their clients increasingly need work to be done not just in that particular place. The clients are increasingly skinnying down the number of firms with whom they work, through formal panel processes, procurement approaches or other efforts. And they want to have one firm or a handful of firms that they can turn to, and with a single relationship partner get seamless service in all of the places that I’ve just described. As a result, if you’ve got that great relationship in one of those places with a client who says, “I love the work you’ve done for me for a decade. I trust you. But we need a firm that can meet our needs not just here, but every place that I’ve described.”

The Hawaiian law firm or Malaysian law firm or Zimbabwean law firm may well lose the client that they’ve long represented. By joining together with Dentons, they’re able to continue to operate as they always have, providing the highest quality service in their local jurisdiction, but get the benefits of the global reach and be able to provide that integrated and seamless service all around the world.

It’s obviously a little more complicated than just following the clients, as there are advantages, like access to technology and innovation and account mobility and diversity and other things. But the core pitch is increasingly clients want that integrated global service and if you can’t follow your clients where you need them, you may lose the clients or the talent.

It’s a familiar story that when a large firm absorbs a small one, there can be friction around dictating higher billing rates and possibly losing some talent and clients as a result. How do you counter that?

As a starting point, we adopted 10 years ago, this concept of polycentricity, where in each part of the firm, there is a degree of “home rule.” There is no central dictate around billing rates or pricing. We don’t have a top-down approach to how certain elements of the way the law is practiced is carried out in our 176 offices. So we’re able to successfully combine law firms, and avoid the trend that you’ve described, because as a polycentric firm, we don’t dictate terms from the center. There is no single Dentons way. We don’t have a headquarters; we don’t have a flag that flies over the firm. And while we provide the integrated service that the clients want, when a firm joins us in Zimbabwe or in Colombia or in Australia, we don’t require them to change their rates, to change their pricing, or to fundamentally alter what they’ve always done for their long-standing clients. And that’s very different from other law firms that, as a condition of becoming a partner in the firm or part of the firm, you agree to much more of a command-and-control, centralized, top-down approach, where prices, rates and partnership standards are set from the center. That’s just not something Dentons has ever done, and that’s one of the distinguishing characteristics of the law firm’s success.

U.S. law firms don’t seem very concerned about competition from the Big Four right now, but given that you have such a large international presence, I’m wondering how you’re dealing with it.

First, let me say I’m delighted that the competitors in the U.S. believe the Big Four will not eat into their business. They’re wrong, but I hope they will continue believing it. Unless you’ve had your head in the sand, you’ve missed the reality that the Big Four, who are at once our clients and friends, are also one of the greatest competitors we face — not just globally but here in the U.S. The Big Four, through their investments in technology, in legal talent, in key practice and service lines, are already competing and they’re not just competing with “low-value, high-volume” work. If you look closely at what the Big Four have been doing, they are moving very swiftly up the value chain and while they may not compete head-to-head in the U.S. today as they do elsewhere around the world, it is already the case that those law firms who believe the Big Four shouldn’t keep them up at night are losing talent and business to them even if they don’t know it.

So what is Dentons doing to compete?

Increasingly, we are building more of a business solutions capability that is very much like what the Big Four do. Our clients come to us and they have a problem that needs to be solved. Sometimes that problem requires a legal services solution, but sometimes they need business consulting or advisory services. And in every region of our firm, we’re building those advisory and consulting capabilities, so we’re able to be not just a leading law firm, but actually a leading business solutions provider.

How do you think lawyers are going to need to adapt?

I think in two principal ways. First, they’re going to need to harness technology to be able to deliver service all the way up the value chain. This isn’t just the highly commoditized work that is done. Increasingly, the available tools are incredibly sophisticated, and the lawyer who is unable to use those tools will be at a distinct disadvantage.

The second skill set that I believe the lawyer of the future is going to need is one around resilience and mindfulness. Lawyers in our firm and every other large law firm are under incredible stress, whether it’s substance abuse, family pressures, mental health issues. And we’ve got to find ways to help each of our lawyers and our business services professionals maximize their potential and help them build greater resilience and happiness within the law firm. Traditionally, that’s not been a skill set people have focused on the same way. We want the lawyer of the future to have the skill, the ability and the knowledge to be much better at adjusting to others, motivating others, working in teams and understanding how to work in a very different environment.