The Perfect Storm to Ask for More Budget

The economic landscape is littered with layoffs, disruptions like dockworker strikes, aircraft manufacturers strikes, geo-political risks, and catastrophic storms. Add in a whole new set of trade policies and sanctions and you have a lot of questions. And — law firm leaders have gone optimistic.

In light of all this, internationally recognized consultant Patrick J. McKenna and I queried more than 250 law firm leaders about the obstacles to growth — and why you should be asking for those budget increases now.

Rare Unanimous Agreement

Absolutely no law firm leader expects the economy to be an obstacle to growth in 2025. You read correctly. Zero. No one. It is a rare occasion when all law firm leaders see the same thing — especially about growth.

These law firm leaders are feeling optimistic and are moving into an investment mindset. They are investing in:

• • Lateral partners
  • Technology
  • Building out existing practices
  • Positioning for new high-rate/high-value practices
  • Training in soft skills
  • Talent retention

All this says it is time to ask for your budget increase while the investment mindset permeates leadership thinking.

Grab the momentum of the day and mood of the market — which is uniformly good. Be sure to make your request an impassioned plea — dispassionate requests are routinely ignored in any economic environment.

It is naïve to think and ignore what could be irrational exuberance. But all new BTI research (see links below) suggests 2025 will be a robust year.

But — the law firm world is not without its obstacles to 2025 growth. These include:

Rates

Rates keep skyrocketing to the point where a few law firm leaders are pinching themselves. But others worry their orbital rates will get them thrown out of the game — or force corporate counsel budgets to a breaking point. In short — it will stunt growth.

The partners skilled at sharing their strategies, staffing and approach — and updating clients about changes in approach — have less of a problem with rates than all the others.

Wrong Markets

These law firm leaders express concern about lacking presence in key practices. They see the opportunity but don’t see enough resources to capture the opportunity.

This is an opportunity for the under-recognized rising stars to shine through. Every firm has them — and if they remain underrecognized they will be the first to leave. Finding them and putting them in front of clients can overcome 2 obstacles.

Wrong Clients

These law firm leaders see too many clients with limited needs. They see the growth in the high end of the market. The leaders don’t see their clients having those needs.

BTI research shows at least 72% of clients face complex legal needs. There is a better than even chance the prized work is sitting in the client base. If not — success likely lies in bringing in a lateral group, or a merger.

Client Turnover

Client turnover has been growing. Fewer clients want to stick around. These clients cite diluted client service, lack of engagement, and cookie-cutter approaches. In addition, both law firms and corporate legal departments are experiencing increasing turnover — leaving relations to whither as partners leave/retire or new corporate counsel take the reins.

The antidote for high client turnover lies in business development professionals supporting relationships, excellent client service, and client feedback at scale. These strategies embed law firms in client’s inner workings — creating relationships beyond the matter at hand.

The Inflection Point

This isn’t just optimism. This is a strategic watershed moment for the legal industry. When unanimous agreement occurs among law firm leaders — especially about growth — it’s time to pay attention.

The message is clear: 2025 isn’t about surviving. It’s about positioning, investing, and transforming.