Over the years, all countries in the CEE region have drawn best-practice models from the West, particularly in legal, economic, and business terms. In a number of CEE countries, offices of international law firms opened in response to the needs of their global clients and market opportunities. These firms played a significant role and introduced their know-how to the legal market. Parallel to this, strong local players emerged in each of these countries, changing the competitive environment and challenging the international ones. Over the last few years, you can see a revision of the need to maintain a presence in the region by some international law firms, most notably Magic Circle and White Shoe firms.
I see this change in the competitive environment as an opportunity rather than a threat. In my opinion, it will continue and international entities will operate in our region through their co-operating firms rather than having physical offices. Those international law firms that will be present, will focus on mid-market, sometimes having ALSP (Alternative Legal Services Provider) divisions as part of their offering. I think what clients will look for is a complex product – from advising on the more voluminous, less complex matters, to the high-end advisory, transactional, regulatory, or international arbitration projects. They will appreciate having a one-stop-shop so that they don’t have to manage a group of 20 or 40 providers, but rely on one trusted external advisory organization that will be able to help with various legal challenges whilst also being able to provide business services at the same time. For example, managing a portfolio of 500 leases, or handling a very complicated transaction or litigation project.
We see this as a game-changer. I think in five or ten years we will have isolated cases of a financially integrated Magic Circle or White Shoe law firm in CEE. It certainly won’t be the norm as it was 20 years ago, and this market will be divided between international players operating mainly in the mid-cap sector, which we are, and the local entities that are growing in strength.
Furthermore, the pandemic has proven that a very important quality in business is flexibility – the ability to adapt to changes quickly. It was a circumstance that no one had anticipated or expected, but it disrupted economic life profoundly and the private lives of everyone. The market is already very competitive and, in my opinion, it will become even more so. I believe that a law business should be built by establishing lasting and long-term relationships with clients. Only in this way, is the business able to grow properly for the benefit of clients and us as trusted advisers. By getting to know our clients’ businesses better, we significantly increase the effectiveness of our cooperation, which the client also benefits from in financial terms.
Finally, my years of leadership have taught me that managing people is one of the keys to success. Leadership is about understanding that everyone is different and has individual needs, challenges, and problems. You have to deal with everyone as an individual and manage them with empathy, whilst also trying to step into that person’s shoes to understand how they feel. We have more than 120 people in Poland, each and every one of whom is different. Therefore, you cannot look at people only through the prism of how you function yourself. I have certainly gone some way, as a leader, in this respect, sometimes learning from my own mistakes. I keep this in mind all the time and continue on this path. Values like Diversity & Inclusion or ESG are becoming increasingly important for all lawyers and clients. This trend will absolutely continue. People working together want to believe that they share not only business but also values.
The legal market has seen several changes in CEE and it’s clear that more changes are ahead. Whilst we have been playing catch-up with Western Europe and the United States, these differences will diminish over time.
By Michal Pawlowski, Country Managing Partner (Poland), DWF