Bringing non-lawyer management professionals into law firm partnerships could give many practices the shake-up they need, a leading management consultant said this week.

Former Clifford Chance managing partner Tony Williams, founder of consultancy Jomati, said professional finance directors would be able to 'drill down' into law firms to weed out unprofitable areas.


He said: 'It is surprising how departments that are thought to be profitable are not, and how much cross-subsidising goes on in a major firm. Good finance directors are much more likely to be able to drill down and look at the profitability of individual practice groups and clients... It should lead to a lot of firms deciding there are areas of work they should be getting out of.'


Mr Williams said the proposals in the government's White Paper on the future of legal services, which will allow lawyers to go into partnership with non-lawyers, would go some way to attracting top managers into solicitors' firms. He said: 'Giving other professionals the formal status of partner in a firm will encourage more good-quality professionals to give law a chance. I am not sure it will be a massive pull, because most other professionals realise how dysfunctional we are.'


He added that he had spoken to a number of private equity houses that were 'seriously looking' at buying a solicitors' practice, in the light of the proposals to allow outside ownership of law firms. He said: 'Law firms can be attractive to private equity houses. There is a reasonably predictable cash flow, [and] the management is relatively poor - which means there is scope to improve. But [investors] do not tend to like people businesses, because people can walk out.'


Mr Williams said some partners saw the proposals as an opportunity to sell the firm: 'They remember the estate agents in the late 1980s, when the banks bought them up for £1 million a branch - and sold them back again [a few years] later - for about a pound. The chances of that happening again are pretty slim.


'If you want to sell up, it is very important to look at your firm as others see it. Firms that never closed a practice area they should have done, or never asked that partner to go, will not be attractive to a buyer. And when they are bought, the buyer will pay less - and kick the hell out of the firm on day one.'