Large law firms have faced their share of challenges in recent years.

But while the challenges and opportunities may be similar across firms, how they respond – and consequently, the rewards and downturns – have been far from similar across the market.

On the surface, the latest Peer Monitor report shows a large law market that currently is treading water at best: demand is basically flat so far this year, rate growth may have peaked somewhat in the near-term, and productivity continues to drop.

But a closer look reveals that beneath the relatively benign surface, some noticeable churning in the market is occurring. Most notably, the very top of the market, particularly the Am Law 100 firms, is showing signs of renewed strength. It is the only market segment with growing demand this year, and it has stronger rate growth than competing segments.

This is largely attributable to recent strength in Am Law 100 litigation and corporate practices.

However, if recent years have shown anything, it’s that the large law market is increasingly fluid.

Firm size is only one factor influencing market dynamics. Firm strategies are a significant factor in firm performance – both on a standalone and competitive basis. These strategies can be internal-facing (firm structure, hiring and compensation models, investment decisions on marketing, business development, etc.) and client-facing (rates, matter staffing, billing, etc.). Decisions in these areas can make a notable difference as firms grapple for market share in an overall market that is growing slowly at best.

We look forward to further exploring these factors and how they impact firm performance.

This post is written by Mike Abbott, vice president, Client Management and Global Thought Leadership with Thomson Reuters

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