The large law firm may be becoming more competitive.  Firms in the highest-performing segment of the market may be pulling back towards market averages, as their performance gap over the rest of the market has narrowed somewhat.  That’s among the findings of The Dynamic Law Firms Study: A 2017 Year-End Update from the Thomson Reuters Legal Executive Institute.

The new report updates last year’s study, which identified two groups of large law firms through Peer Monitor data: Dynamic and Static – representing the highest- and lowest-performing quartile of firms during the 2014-2016 period.

Looking at the same groups of firms from the previous study, the updated report found that the profitability advantage of the Dynamic firms narrowed slightly in 2017, as Static firms may be adopting some of the best practices from the Dynamic firms. The Dynamic firms’ advantage in average profit margins compared with the Static firms shrank from about four-and-a-half percentage points to three percentage points.