TLOMA Today

Is it February already? I am writing this on the day after Wiarton Willie has predicted an early spring. After the dumping of snow that we got last week, I hope that his prediction comes true.

This Is my last President’s message. Later this month, I will be handing over the reins to the next TLOMA president: Ava Isaacson, the Director of Team Development at SHERRARD KUZZ LLP.

It has been an honour for me to serve as the President of TLOMA. I wish to thank the members of the TLOMA Board for their commitment and dedication throughout the year. A special thank you of the members who will be leaving the Board and a welcome to those who will be joining the Board. Thanks go to Pat Carrano, Farzad Boreyri and Michelle Bilboe who are leaving the Board after our handover meeting of February 26, 2026. Joining the Board are Anthony Belmonte as Vice-president, Parminder Gill as Treasurer and Amanda Hinsperger, Conference Committee Chair. A resounding note of appreciation goes out to our Administration Team: Karen, Courtenay and Risy.

I hope that you appreciate your TLOMA membership as much as I appreciate mine. If you know me, you have heard me say many times: “TLOMA is my lifeline”. It is the most valuable resource that we have to support us in our roles as Law Office Managers. Make the most of your membership: participate in events, contribute to the forums, attend the annual conference. You won’t regret it.

As the calendar turns toward March 31, 2026, law firm partners across Ontario are facing a new regulatory reality. While the Law Society of Ontario (LSO) Annual Report has always been a standard administrative hurdle, this year is different. For the first time, every lawyer and paralegal in private practice must confirm they have a Client Contingency Plan that meets strict new minimum requirements under By-Law 7.1.

This isn't just a "check the box" exercise. It is a fundamental shift in how the LSO views a firm’s professional responsibility to its clients in the digital age. If your firm hasn't modernized its IT infrastructure to support this mandate, you aren't just facing an administrative error you are facing a significant compliance risk.

The Shift from "Succession" to "Digital Continuity"

Historically, "contingency planning" was a euphemism for succession planning what happens if a sole practitioner retires or passes away. However, the 2026 mandate acknowledges a more modern threat: Digital Absence.

What happens if your firm is hit by a ransomware attack that locks every file for three weeks? What happens if a key partner is suddenly incapacitated and the only person with the admin credentials to the trust account is unavailable? The LSO’s new requirements are designed to ensure that the "professional business" of a firm can be preserved, carried on, or wound up without harming client interests, regardless of the cause of the disruption.

The Four Pillars of a Compliant 2026 Contingency Plan

To meet the LSO’s minimum requirements, your plan must be functional, documented, and reviewed annually. From an IT perspective, there are four critical gaps most Toronto firms currently have:

1. The "Administrative Key" Problem (By-Law 7.1, Section 3)

The Law Society now specifically requires that your plan includes the "means to access computers, email, accounting, and other electronic records." Many firms rely on "informal" password management sticky notes, shared spreadsheets, or the memory of a single office manager. Under the new mandate, this is non-compliant. Firms need a secure, encrypted Credential Vault that allows an appointed Plan Administrator (who must also be a licensee) to gain immediate access to critical systems during an emergency.

2. Immutable Access to Trust Accounts

The LSO is, above all, a protector of the public interest specifically, client funds. Your contingency plan must provide the administrator with details of and access to all trust accounts and accounting records. If your accounting data is stored on a local server that hasn't been backed up to an immutable cloud environment (backups that cannot be changed or deleted), a single hardware failure or cyberattack could make you non-compliant with the LSO's requirement to maintain access to financial records.

3. Virtual Verification and "Authentication" (The 2024/25 Carryover)

While the contingency plan is the "new" news, it works in tandem with the virtual verification rules that became mandatory in 2024. If your plan includes working remotely or virtually in an emergency, you must use technology that authenticates government-issued ID. Simply looking at a license over a video call is no longer sufficient. Your IT stack must include biometric or technological ID validation to meet the "baseline competence" the LSO expects in 2026.

4. The "Successor Licensee" Connectivity

Partners and associates must confirm that their firm has a plan for scenarios where no members of the firm are able to carry on the business. This requires a secure, external "Digital Continuity Kit" that can be handed to an outside licensee. This kit must include client lists, file locations (open and closed), and will indices—all while maintaining strict solicitor-client privilege.

The Hidden Risk: Cyber Insurance and Professional Indemnity

In 2026, the link between LSO compliance and insurance eligibility has never been tighter. Major insurers like CLIA and LawPRO have updated their 2025-2026 policies to reflect minimum cybersecurity standards, including Multi-Factor Authentication (MFA) and active endpoint monitoring.

If you claim on your LSO Annual Report that you have a "compliant contingency plan," but your IT systems lack MFA or a tested disaster recovery protocol, you are creating a "coverage gap." In the event of a claim, an insurer may argue that your failure to meet LSO’s baseline technical requirements constitutes a breach of policy conditions.

Is Your Firm Ready for March 31?

The Law Society has a statutory duty to ensure the competence of its members. In 2026, that competence is inextricably linked to your technology. A contingency plan on paper is worth nothing if the data it refers to is inaccessible, unencrypted, or unverified.

We help Toronto law firms bridge the gap between "legal intent" and "technical execution." We don't just provide IT support; we provide the compliance framework that keeps your firm operational and audit-ready.

Free LSO Compliance Audit for Law Firms

Don't wait until the March deadline to discover your contingency plan is technically impossible to execute. Contact Group 4 Networks today for a 15-Minute Digital Continuity Audit. We will review your credential management, backup immutability, and remote access protocols to ensure you can file your 2025 Annual Report with total peace of mind.

A few months ago, I had the privilege of speaking at the TLOMA Conference, where I connected with so many smart, committed, operationally-minded professionals who are powerfully shaping the future of law firm management.

We talked about something I see in nearly every firm I work with, regardless of size, structure, or location:

Law firm strategic plans fail.

They don’t fail because they lack great ideas or incoming commitment.

They fail because those ideas don’t turn into action.

That’s the Strategy Gap—the space between the plan on paper and meaningful progress in applying the strategy. It’s where even the most inspired vision can stall out. And too often, it does.

Strategy Is Only as Strong as Its Follow-Through

We’ve all seen it: the energized leadership retreat, the beautiful spiral-bound plan, the ambitious goals.

And then—months go by.

The plan fades into the background.

Day-to-day work takes over.

It’s not that the strategy was flawed.

It's that it wasn’t built to survive the reality of firm life.

Most plans fall into one of two traps:

• Too high-level—all vision and values, with no path to implementation.
• Too tactical—just a to-do list in a tuxedo, disconnected from any bigger picture.

Neither approach creates momentum. And without momentum, even the best ideas stall.

Know :: Be :: Do :: A Simpler, Smarter Way to Plan

At SGI, we help firms bridge the strategy gap using a framework we call Know :: Be :: Do:

• Know what matters most: your direction, your priorities, your real goals
• Be the kind of team and culture that can deliver: this is your identity shift
• Do the focused actions that move the needle—not everything, just the right things

Think of it like a GPS:

• Know is the destination
• Be is the vehicle
• Do is the turn-by-turn

It’s not just a planning tool—it’s a mindset for strategic execution.

What a Great Strategy Looks Like

A strong strategy doesn’t just inspire—it directs.

At the top of any plan should be your vision and values. That’s your why.

But to activate that why, you need to translate it into a strategic objective—a clear, measurable goal.

From there, define the initiative that will move that objective forward.

And finally, map out the activities—the concrete, doable actions your team can execute.

Here’s what that looks like in action:

Vague Objective:

“Improve our referral network.”

Sounds nice—but what does it mean? Who owns it? How do we measure success?

Clear Strategic Objective:

• Strategic Objective: Grow our referral base by 25% in two years
• Initiative: Deepen relationships with accountant referral partners
• Activities: Schedule three outreach meetings. Create a pitch deck. Host one roundtable.

That’s a plan people can do. That’s how you move from idea to implementation.

Five Fixes for a Strategy Gap That Change Everything

So what does it actually take to bring a strategic plan to life?

Once you know where you want to go, it’s not about doing more—it’s about doing what matters, with intention and structure. These five shifts can make all the difference between a plan that collects dust and one that drives your firm forward.

1. Create Buy-In

A strategic plan only works if people believe in it—and see themselves in it.

That’s why we always encourage firms to involve people from all levels and roles in the planning process. When the plan is shaped by more than just leadership, it becomes a shared commitment, not a top-down directive. It feels like our plan—not their plan. And that distinction changes everything.

2. Break It Down

Most firms enter the planning process with a long list of goals. Too long.

The key isn’t to ignore those ambitions—it’s to prioritize ruthlessly. Capture everything, but focus only on the 3 or 4 strategic priorities that will really move the needle over the next 1–3 years. Then, inside each priority, break it down again—until each piece is clear, actionable, and manageable.

This approach preserves your big ideas while cutting through the fog. It protects your focus, your energy, and your capacity to actually execute.

3. Build Accountability

Every piece of the plan needs an owner. No passengers.

And not just for the overall goals. Every objective, initiative, and activity should have a name beside it—a person who’s accountable for making sure it moves. They’re not doing all the work, but they’re the one who ensures the work is getting done.

Accountability doesn’t mean micromanagement. It means clarity. And clarity fuels momentum.

4. Use a Living Tool

Plans don’t live in binders. They live in systems people use.

Whether it’s a simple spreadsheet or a project management platform, your strategy needs to live somewhere visible and accessible. And it needs to become part of how you operate—not just a document you revisit once a year.

This means making the plan a standing item in meetings—weekly, monthly, quarterly, and annually. Check in. Track progress. Reconnect with the “why.” Touch the plan every day.

When the plan becomes part of your firm’s rhythm, strategy becomes habit.

5. Calibrate—Don’t Recreate

Every plan needs to evolve.

Markets shift. Priorities change. Internal dynamics move. That doesn’t mean you throw the plan out and start from scratch. It means you adapt intelligently.

Adjust your objectives. Reorder your initiatives. Revise timelines or activities. But keep the plan alive. Keep it moving.

What Now?

Whether you have a beautiful plan gathering dust or no formal plan at all, you can start now.

Get clear on what your firm needs to Know, Be, and Do—right now. Bring those conversations back to your leadership table. And don’t wait for a perfect plan. Start with a real one.

Because here’s the truth: you don’t need to be the managing partner to drive strategic conversations.

Some of the most powerful influence comes from operational leaders—those who understand how work really gets done.

And the firm can’t afford to keep strategy theoretical.

Start the Right Conversations

Here are a few questions that spark meaningful, strategic dialogue—whether or not your firm currently has a plan:

• What pain points are we brushing past?
• Who’s missing from this conversation?
• What assumptions are we still clinging to?
• And if we do have a plan—is it still serving the business we’re actually running today?

These aren’t just planning questions.

They’re culture questions.

They’re leadership questions.

You’re the Bridge

Strategy becomes real when someone decides to act.

Why not make it you.

You don’t need a title.
You don't need permission. 

You just need clarity, conviction, and a starting point.

Because you’re the bridge between the idea of strategy—and the reality of implementation.

The Negotiation is Just the Beginning: Why Law Firms Still Overspend on "Killer" Contracts

For the modern law office manager, a signed contract often feels like a finish line. You’ve spent weeks — perhaps months — negotiating over legal research database rates, vetting managed IT service providers, and securing deep discounts on VoIP systems. When the ink dries, it’s natural to feel that you’ve successfully sealed the door on budget overruns.

However, as expense optimization consultants, we have seen even the sharpest legal minds leave substantial money on the table. The uncomfortable truth is this: A well-negotiated price is only a small part of the battle. Without meticulous, ongoing monitoring, the savings you won at the table rarely make it to your bank account.

The Hidden "Leakage" in Legal Operations

The legal industry spends billions annually, and a significant portion of that is unnecessary overspending. In a high-stakes environment where every "soft hour" is accounted for, law firms often default to long-standing vendors or skim over lengthy monthly invoices. This neglect creates "leakage" in three primary areas:

• The Unmonitored Price Creep: Even with fixed-rate contracts, vendors frequently introduce incremental costs or will backload their fees to recover the discounts they offered upfront. Without active oversight, these adjustments compound, neutralizing your hard-won negotiations.
• The Renewal Trap: Almost every major vendor — from telecom to waste disposal — utilizes automatic renewal clauses. Missing a 30, 60, or 90-day termination window strips your leverage, locking the firm into non-competitive rates for another multi-year term - or face hefty early termination fees.
• Unrecognized Billing Errors: It is not unusual for vendors to make errors in their own favor. These are often small enough to be missed by a busy administrative team but large enough to cost a firm tens-of-thousands of dollars over a fiscal year.

A 3-Step Strategy for Vigilant Cost Management

To transition from a "sign-and-forget" mindset to a "watchdog" approach, law firms should implement the following framework:

1. Execute a Baseline Audit

Before looking forward, always look back. A "deep dive" into existing service agreements to understand what you’re paying for ensures current billing perfectly aligns with your needs. This process often reveals months, or even years, of compounded misalignment.

2. Shift to Dynamic Cost Optimization

Market rates for technology, cloud storage, and telecom shift by the minute. Rather than waiting years for a renewal, firms should treat cost management as an evolving process. By continuously benchmarking usage against current market rates, you can adjust tiers and pricing mid-contract to ensure you always occupy the most competitive bracket.

3. Implement a Continuous Auditing Model

The most effective safeguard is a persistent watchdog approach where every invoice is vetted against contractual obligations. This creates a zero-risk environment where errors are caught in near real-time and renewal windows are flagged months in advance.

The Strategic Shift: Outsourcing the "Deep Dive"

We understand that Law Office Managers are pressed for time. Combing through office supply bills, Merchant fees or telecom line items requires hours you don’t always have.

Outsourcing these cost-saving solutions to experts is more than a financial decision; it’s a strategic one. Utilizing a third party to manage vendor relationships allows your firm to maintain professional goodwill with providers while ensuring you are never overcharged. By making cost optimization a permanent part of your operations, you ensure your firm isn't just winning negotiations but actually realizing the profits.

AI has moved from concept to expectation far faster than most legal teams anticipated. Not long ago, AI in law was still framed as experimental. Today, leadership teams are asking how quickly it can improve efficiency, reduce costs, and create measurable value.

Yet many firms are discovering a widening gap between AI ambition and AI readiness. That gap is rarely about technology. It is almost always about data quality, governance, and security.

Insight: The Starting Point for AI Readiness

AI depends on understanding what data exists, where it lives, how it is structured, and whether it is relevant. Many legal teams still operate with limited visibility across shared drives, legacy systems, and historical matters. AI cannot compensate for missing, duplicated, or poorly organized information. Weak input leads directly to unreliable output.

Establishing insight means gaining clarity across the data landscape and understanding patterns, relationships, and risks within it. Without that foundation, AI tools are forced to operate in the dark.

Govern: Turning Data into Context

Governance provides the structure that allows AI to function effectively. It is not just a compliance exercise; it supplies the context machine learning models need to interpret information correctly. Classification, retention, version control, and consistent lifecycle practices reduce noise and prevent AI from learning from inaccurate or outdated material.

Governance removes the chaos that undermines performance. It also creates consistency, which is essential when AI is expected to scale across matters, teams, and practice areas.

Protect: Where Trust Is Built

Protection is central to whether AI can be used with confidence. Legal teams manage some of the most sensitive information in any industry. Without strong controls—role-based access, secure repositories, defensible disposal, and privacy frameworks—AI tools can magnify existing weaknesses.

No firm wants AI surfacing documents that should have been deleted years ago or exposing information that violates client confidentiality. Protection ensures AI operates within clear boundaries and remains defensible, both legally and reputationally.

This is where the narrative around security has changed. Security is no longer a blocker to progress. It is the precondition for innovation.

When Security Enables Innovation

Modern AI demands higher levels of data maturity than previous generations of technology. Secure environments reduce clutter, remove unnecessary data, and lower the risk of bias or exposure in AI outputs. Clear access controls ensure AI tools know exactly what they can and cannot touch, increasing both trust and reliability.

Defensible disposal eliminates ROT data that causes unpredictable results. Structured classification helps AI identify matter types, relationships, and risk patterns. Privacy controls ensure sensitive data is handled appropriately during training and use. Together, these practices directly improve output quality.

Security also drives operational benefits. Smaller, better-managed repositories reduce storage, backup, and eDiscovery costs. Fewer legacy systems mean fewer vulnerabilities. Faster, more accurate data retrieval improves matter management and productivity. These gains create the capacity—financial and organizational—to adopt AI responsibly.

Client Trust and Competitive Credibility

Clients now expect firms to use AI with care. They want assurance that their confidential information remains protected, even as new tools are introduced. Firms that demonstrate strong governance, security, and oversight gain credibility and confidence in the market.

Security teams and innovation teams are converging. What once felt like background operational work now forms the engine for AI-driven efficiency, insight, and differentiation.

From Aspiration to Advantage

Only after insight, governance, and protection are in place can firms fully use their data for AI-driven outcomes—supporting drafting, identifying risk patterns, streamlining workflows, and delivering deeper insight. Many firms rush to this stage, but the advantage comes from doing the groundwork first.

AI does not fail because the technology is flawed. It fails because the data environment is not ready. Firms that invest in strong data quality, governance, and security move from AI aspiration to sustained advantage. Those that do not will continue to face inconsistent results, user skepticism and increased risk.

The lesson is clear: innovation moves faster—and goes further—when the foundation is strong.

The legal workplace is no longer defined by precedent alone.

As law firms move beyond the reactive shifts of the early hybrid era, office design has entered a more intentional and strategic phase. What began as short-term adaptation is now a long-term rethinking of how space supports legal work, firm culture, client trust, and competitive advantage.

In 2026 and beyond, law offices are no longer passive containers for desks and private offices. They are purpose-built ecosystems—designed to attract top talent, enable high-value legal work, and reinforce a firm’s identity in an increasingly digital and competitive marketplace.

This article examines the key forces shaping the future of law office design and explores how forward-looking firms are planning spaces that will remain relevant well into the next decade.

Hybrid Work Has Matured—Now the Office Must Earn Its Purpose

Hybrid work is no longer an experiment. It is the operating reality of modern law firms.

By 2026, most firms have moved past debates about whether hybrid work “works” and are instead focused on optimizing it. Office attendance patterns are predictable: mid-week peaks, lighter Fridays, and intentional in-office days centered on collaboration, mentoring, and client engagement.

As a result, firms are abandoning rigid, fully assigned layouts in favor of:

• Hoteling and neighborhood-based seating
• Shared team zones
• Flexible touchdown spaces

This shift is not about reducing desks alone. It is about reallocating square footage toward activities that cannot be replicated remotely. Meeting rooms, collaboration areas, and client-facing spaces continue to expand, while underutilized individual workstations shrink.

The most successful firms are no longer mandating attendance, they are designing offices that make presence worthwhile. In 2026 and beyond, the question is no longer “How often should people come in?” but “What happens here that cannot happen anywhere else?”

Designing for Uncertainty: The Rise of Adaptive, Future-Ready Law Offices

If the last few years have taught firms anything, it is that static office planning is a liability.

Leading law firms are now designing for adaptability—often referred to as planning for “Day Three.” This approach assumes that work patterns, technology, and staffing models will continue to evolve, and that spaces must be able to evolve with them.

Key strategies shaping future-ready legal workplaces include:

• Modular wall systems and movable partitions
• Reconfigurable meeting and training rooms
• Multi-functional common areas that shift use throughout the day

Rather than over-customizing for a single moment in time, firms are adopting standardized components that allow personalization through finishes, branding, and artwork. This balances flexibility, cost control, and long-term ROI.

In 2026+, the most valuable law office is not the most beautiful—it is the most adaptable.

Technology and AI Are Now Core Drivers of Space Planning

Technology is no longer layered onto the law office—it is shaping it from the ground up.

By 2026, legal technology spending has firmly established itself as one of the largest investment categories for firms, often rivaling real estate costs. This reality is fundamentally changing how offices are planned and used.

Modern law offices are designed around:

• AI-enabled room booking and utilization platforms
• High-performance video conferencing and hybrid meeting suites
• Cloud-based document management reducing physical storage
• Smart workplace analytics guiding long-term space decisions

As artificial intelligence continues to automate research, discovery, and administrative tasks, the spatial footprint of support functions is shrinking. That space is being reinvested into high-value activities—client collaboration, strategic thinking, and interdisciplinary teamwork.

In the next phase of law office design, technology does not simply support work; it dictates where and how work happens.

Hospitality-Inspired Design Is No Longer Optional

In an era of reduced in-office time, every visit carries more weight.

Law firms in 2026 are embracing hospitality-driven design not as a luxury, but as a strategic necessity. Offices are expected to feel intentional, welcoming, and aligned with the firm’s brand—much like a high-end hotel or private members’ club.

This approach is reflected in:

• Café-style hubs and informal lounges
• Warm, curated reception experiences
• Premium materials such as natural wood, stone, and textured finishes
• Client-facing spaces designed to convey trust, discretion, and quality

These environments signal professionalism and confidence while supporting informal connection—something increasingly rare in digital-first workflows.

The future law office understands that experience is part of service delivery.

The Private Office Is Evolving—Not Disappearing

Despite the rise of collaboration, privacy remains non-negotiable in legal practice.

In 2026 and beyond, private offices continue to play a critical role, but their design is becoming more equitable and flexible. Many firms are adopting uniform private office sizes across seniority levels, improving efficiency while reinforcing cultural alignment.

Key shifts include:

• Private offices designed for focus and confidentiality
• Improved acoustic performance across all spaces
• Reduced physical storage as digitization accelerates

These offices are no longer symbols of hierarchy alone—they are tools for deep work, sensitive conversations, and client trust. Importantly, they are being designed with future conversion in mind, allowing them to transition into meeting rooms or alternative uses as needs change.

Wellness and Human-Centered Design Are Strategic Imperatives

Attorney wellbeing is no longer a secondary consideration—it is a business issue.

Data continues to show that lawyers in the post-pandemic era spend less time working in isolation and significantly more time collaborating, learning, and mentoring. Law offices must support this behavioral shift without sacrificing focus.

Future-facing legal workplaces prioritize:

• Access to daylight and exterior views
• Ergonomic, height-adjustable furniture as a baseline
• Biophilic materials and calming color palettes
• Inclusive layouts that support varied work styles and neurodiversity

These design choices directly impact fatigue, engagement, retention, and long-term performance. In 2026+, the most competitive firms recognize that human-centered design is not about comfort—it is about sustainability of talent.

Sustainability and ESG Are Embedded, Not Added On

Environmental and social responsibility are now embedded into law firm real estate decisions.

Clients increasingly expect their legal partners to demonstrate alignment with ESG values, and offices are becoming visible expressions of that commitment. This includes:

• Energy-efficient buildings and systems
• Low-emission materials and finishes
• Furniture designed for durability and reconfiguration rather than replacement

Sustainable design is no longer a branding exercise—it is a risk management and reputation strategy.

The Law Office as a Cultural Anchor in a Hybrid World

Perhaps the most significant shift is philosophical.

In 2026 and beyond, the law office is no longer defined by how many people sit at desks each day. It is defined by what it represents.

High-performing firms are using their offices to:

• Reinforce mentorship and professional development
• Create shared rituals that strengthen culture
• Deliver exceptional, trust-building client experiences
• Visually express stability, expertise, and long-term commitment

The office has become a cultural anchor—a place people choose because it adds value to their work, their relationships, and their identity as legal professionals.

Designing for the Law Firm of the Future

The future of law office design is not about trends—it is about intention.

As firms move deeper into the hybrid era, the physical office is being redefined as a strategic asset that supports performance, trust, adaptability, and human connection. The most successful legal workplaces of 2026 and beyond will not be the largest or the most traditional. They will be the most thoughtful.

The law office of the future is not simply where work happens.
It is where value is created.

Sources

• American Bar Association. (n.d.). Legal technology resource center & law practice management research. https://www.alanet.org
• Allwork.Space. (n.d.). Workplace trends and insights. https://www.allwork.space
• FOX Architects. (n.d.). Law firm design and workplace strategy. https://www.fox-architects.com
• HOK. (n.d.). Law firm workplace strategy and design insights. https://www.hok.com
• Interaction. (n.d.). Hybrid workplace strategy and office design. https://www.interaction.uk.com
• Maptician. (n.d.). Hybrid work, office utilization, and workplace analytics. https://www.maptician.com
• Red Thread. (n.d.). Hospitality-inspired workplace design. https://www.red-thread.com
• Thomson Reuters. (n.d.). Legal industry technology and investment trends. https://www.thomsonreuters.com
• Williams Lea. (n.d.). Human-centered and inclusive workplace design for professional services. https://www.williamslea.com
• Work Design Magazine. (n.d.). Adaptive and future-ready workplace design. https://www.workdesign.com

Private equity is now a major and, in many cases, deciding factor to enable solvency and structural reformation, and is forcing law firms to choose if and how they meet demands of clients and the legal market itself.

My opinion column, The Law Firm Pyramid Rollover, that examined how artificial intelligence, pricing, and transience of the legal service sector’s workforce is causing the traditional law firm pyramid structure to rollover like an upending iceberg sparked two strong and opposing reactions: One was numerous republishing requests, reposts, and commentary while the other was dead silence.

The former reaction is flattering but the latter is more telling. In response to that column and others, the silent majority has told me privately that while they identify with my opinions and agree with many points raised, remaining silent is how they feel they must react publicly due to fear of retribution and consequences.

My message to the silent majority is that I hear and see you. I know that you are there and support you.

The Private Equity Puzzle

Legal services is the last sector to rebuff elements of business modernity. As a result, it is now facing an existential crisis. Cracks in the legal services façade and signs of increasing stress appear daily, which is why a silent reaction has always signaled that my opinions are on target.  

While provoking thought is a desired reaction, initiating decisive action is my intention.

That is why in “Pyramid,” I intentionally chose not to discuss how and why private equity is making inroads along with its potential impact on the legal services sector. Because private investment is a major topic, including it would have been overwhelming.

Still, we need to face the PE factor head on. So, buckle up, buttercup; here we go.

Pioneering Experience

With a plethora of private equity articles floating around, I, like you, have been reading about issues pertaining to PE within the legal services sector. Generally, it seems to me that many or most of these articles are the work of individuals trained as lawyers whether or not they practice.

While this is fair and, frankly, to be expected, it also seems that lawyers have a built-in proclivity to lean toward legal practice. Perhaps this is because of training and experience and, therefore, is what they know best. Still, it can result in a natural tendency to focus on how private equity could or will affect legal practice with a lesser focus on how outside investment can affect aspects of legal services business, which with a deep business background is what I know best.

Ironically, we’ve been here before, or at least I have. Oddly enough, and if recent client inquiries are anything to go by, my experience with outside investment in law firms is coming back in fashion like turtlenecks, bellbottoms, and gold chains, but with much higher value attached.

Here’s why: I entered the legal services sector in 1998 with a strong business management background, particular experience restructuring and turning around businesses in trouble, and an entrepreneurial temperament. These traits lent themselves to spending three years as the sole markets advisor to Donahue LLP, a 130-lawyer, three-office business law firm that operated within Ernst & Young from 1997 to 2003 as Canada’s first, and so far, only Big Four multidisciplinary (MDP) business legal practice with a U.S alliance. 

We were pioneers. The combination of Donahue’s MDP uniqueness with me being its only embedded markets advisor meant I learned the legal business and how to market, manage, and survive in it with the velocity of drinking from a firehose. I loved it. Working simultaneously with EY and Donahue during that time has served me and law firms I’ve worked with very well over the years since. It has also enabled me to write and speak about alternative business structures (ABS), multidisciplinary practice (MDP), and private investment from both a unique perspective and lived experience.

A Ground Breaker

Donahue was a groundbreaking ABS born and operating at a time before “alternative business structure” was a twinkle in the legal sector’s eye, never mind a term in its lexicon. As a pioneering MDP enterprise that went to market as a “one-stop-shop” for professional business services, we battled damn near daily with law regulators who argued that the closeness of lawyers within what was often referred to as EY’s “captive law firm” – imagine how much the lawyers liked that – and the accountants was too close in too many ways.

While, after a six-year, hard-fought run, Donahue wound up Canadian operations in 2003, I find it deliciously ironic – and as a management expert, am delighted and feel vindicated – that almost 30 years after Donahue’s breakthrough, the Big Four’s KPMG won entry to the U.S. market via licensing in Arizona in February 2025.

I also find it amusing that despite barbarians-at-the-gate fearmongering, pearl-clutching commentary, and the ninny-ness of lawyer “specialism,” many law firms worldwide – due to the triple whammy of artificial intelligence, pricing, and talent transience – have been spurred to learn about outside investment and the value of professional management to handle a firm’s operational infrastructure, all of which enables lawyers to do what they say they went to school for: Lawyering.

So, let’s get one thing crystal clear: Private investment is not just coming to legal services; it’s been here for a long time. Therefore, there is no sense standing on the brakes of this business-based advancement, but rather keeping an open mind to learn if and how working with outside investment may have benefits for pioneering enterprises seeking new operating structures to survive in the legal services market of today and tomorrow.

The Last Bastion

Modernization has come to almost every classification of economic activity in the world. The legal services sector is the last professional bastion to be breached by and accepting of modern operational business procedures and conduct. Because the legal services industry is the business world’s last holdout – and to avoid the echo chamber and angst of the legal-beagle set – it is advisable to look outside the law firm purview for change management direction.

Yes, I know; lawyers are different. Being trained to argue, they will often resort to whatever defence can possibly apply at that particular moment that lends some kind of support to whatever position they have taken. Furthermore, they often collect cronies to join them in a pile-on and are apt to consider themselves having won whatever fight they think they are in due to having what they believe is the last word.

Still, my concern is that a tendency to claim rightness may be a deciding factor in winning the battle but losing the war. Not that lawyers who are often subjected to over-simplification as a homogeneous class are the enemy in any way, shape or form, but a lawyer-like risk-averse trait of clinging like a barnacle to what was can often be fatal.

There are also times when I sense a self-selected destructiveness within the resistant ranks of legal services that supports Charles Darwin’s evolutionary theory of “survival of the fittest” and an observation by that old Machiavellian, Napoleon Bonaparte, who allegedly quipped: “Never interrupt your enemy when he’s making a mistake.”

Money Talks

As to private equity, it would be a mistake to say that we have not been party to enabling PE to be active within the legal services sector.

Take, for example, Chambers Global that was bought in 2018 by U.K. private equity firm, Inflexion, that realized a 4.7x return on its investment when it sold Chambers Global to U.S. mid-market investors, Abry Partners, in 2023. After selling Chambers Global, Inflexion bought U.K. law firm, DWF, that same year.

However, Chambers Global being owned by Inflexion from 2018 to 2023 means lawyers and law firms that participated with and were listed in Chambers anytime during that five-year period were enmeshed with a private equity organization. Think about it: Not only did participating lawyers and law firms provide Chambers Global with reams of information – some of it borderline confidential – but also handed over what is often privileged but client-often-reluctantly-approved contact information in the hope that interviews with these contacts could culminate in lawyers and law firms having a chance to be listed in a blessed directory.

The same year that Inflexion bought DWF, Allen & Overy spun off its risk management business to Inflexion and Endicott Capital prior to merging with Shearman & Sterling with the intention to hold a “significant minority stake” in this business that provides finance sector clients with subscription-based online legal analysis pertaining to compliance topics.

As recently as November 2025, U.S.-based McDermott Will & Schulte acknowledged “fielding inbound interest” in private equity investment. When an AM Law 50 firm considers PE funding, any argument that this type of investment is suitable for only small- to medium-size law firms or boutique practices falls away and fails fast.

Private equity is also active in Canada. Speaking personally, in 2024, a venture capital company asked me to access efficiencies of targeted Canadian law firms and consult with the VC to decide which of these firms to approach for potential investment. I declined due to a myriad of reasons ranging from potential client conflict concerns to lack of capacity and general disinterest. It didn’t help that this particular VC had a notion that applying pressure tactics and time constraints was a strategy that would achieve its objective to retain me rather than the resulting zero-sum outcome. (Watch for that.) However, anyone who knows me is fully aware that I don’t take direction well. No independent advisor worth a damn does.

Still, I find it puzzling that when private investment has been active in the legal services sector for years, handwringing about it now seems to be the newest obsession rather than tackling more prevalent factors threatening the business of law, such as AI, pricing, and transient talent that are impacting the legal services sector right this minute. Then again, for some law firms, introducing private equity into their business back office may be a possible solution to solving parts of this puzzle.

Business, Not Practice

Private equity is interested in injecting new capital into legal business, not practice. This is evident in private equity’s investment in other sectors, such as dentistry where PE has bought into the business operations side because that is its strength. PE is not capable, licenced, or interested in drilling teeth.

The same can be said for the business of law where many firms long ago spun off their internal business services into a separate unit to house finance, IT, marketing and business development, professional development, human resources, and whatever else might be applicable, leaving the practice of law side of the firm as a unit unto itself.

It’s this spun-off internal business piece that is of interest to private equity because it’s ripe for conversion to a professionally Managed Services Organization (MSO). PE is well-able to ignite better efficiency aided by professional management, guidance, and resources to streamline operations starting with removing procedures and deadwood (as suggested in “Pyramid”) that seem to be sacred cows to many law firms unable or unwilling to execute this necessary efficiency requirement themselves.

Control Issues and Structural Flaws

The nut of this issue for law firms is the lawyerly trait of needing to have control along with a potential threat – real or imagined – of losing whatever control they think they have. However, running a business is not what most lawyers identify as a strength, nor do many of them want it to be.

Because of private equity’s deep understanding of business and that money makes the world go around, there is no danger of PE asking such questions as, “What does ‘variance’ mean?” This was a question I overheard a senior partner who – wait for it – practiced business law for 30 years ask another lawyer who didn’t know the answer. (Over the years, I’ve asked other lawyers this question and none has known the answer, which is that variance is the difference between budget and actual that is analyzed and reported monthly.) Principles of finance are basic business, which is not taught in law schools, but it is the lifeblood of commerce and corporate management.

Ironically, the reason we’re talking about private equity at this point in time is a direct result of law firm structure history.

Consider what could have happened if law firms of yesteryear had had the sense to structure themselves like almost every other enterprise of commerce by employing both a strict business approach to money along with savvy financial professionals to manage it without interference, rather than what we’ve got now: Law firms that seem to treat their businesses as private clubs or banks, and drain the coffers each year to dole out doubloons to equity partners. If you think about it, the history and absurdity of this antiquated structure is mind-boggling to the point of completely bonkers.

The Problematic Pyramid

The pyramid structure of traditional law firms has always been peculiar due to relying on hierarchy and scaling from the bottom up. Now, due to hair-on-fire business issues that include AI, pricing, talent transience, and private equity, the pyramid structure is flawed to the point of faltering and in many instances, failing.

The hierarchical pyramid structure is the opposite of flatter structures that encourage and enable contributions of ideas, systems, and improvements from all team members regardless of tenure, status, or whatever label you want to put on people. It is how entrepreneurial entities work best and grow with assurance that is based on rock-solid business plans that are also engineered for flexibility within brightline boundaries.

This is why anyone who has worked outside of the legal industry prior to coming into it, quickly and fully grasps an understanding that law firms breathe rare air. How law firms operate and why is often completely mystifying to these people since law firms in general and their operations in particular usually defy both business principles and basic logic. As a result, there are many law firms that are successful by sheer accident. I should know having experienced this many times since 1998, and I’m not alone.

For outsiders who join legal services, their physical, mental, emotional, and spiritual safety valves require taking the work seriously and either cultivating or being naturally blessed with both a sense of humour and the ridiculous. Otherwise, and without these personal and professional features, they will often up sticks and go elsewhere.

Backward, Then Forward

A strong sense of self is a sanity and safety mechanism because egos are a major factor within legal services. I’m not talking about one’s sense of identity or self-worth that is important for each of us to have and nurture, but rather about the fragility of humanity and its potential for failure than can manifest as toxicity and/or oversized perceptions of self-importance that demand constant validation.

Another factor is the notion of legacy. Legacy is a fallacy because changes or advancements made at the time of their doing tend to fade sooner than you think. Again, I should know having made systemic changes to structures and operations of various law firms only to see some of these improvements backslide and for a firm to eventually revert to its former state.

Oftentimes, I’m asked to return and shore up what was lost. However, recognizing the overarching futility and that I’d be doing it solely for money – which runs contrary to my ethical streak – I usually don’t bother since without consistent management and reinforcement, improvements are often like sandcastles on a beach; the tide or a storm will eventually sweep them away.

Because the practice of law is an evidence-based profession, there is a strong reliance on using data as proof especially in troubling times. Management expert, Peter Drucker, said, “The greatest danger in times of turbulence is not the turbulence – it is to act with yesterday’s logic.” I go one step further and suggest that a reliance on data means working with dated information culled from history since that’s what data is: Historical. This means that even with all the data in the world allegedly acting as proof, that old chestnut: “Past performance is not indicative of future results” is the perfect argument.

Therefore, the trouble for the legal services sector in coming to grips with the understanding that while precedence is a basis on which the practice of law sits, any data culled from history are not one whit predictive of the future pertaining to the business of law. This is why that terribly tired yet pervasive old question: “Who else has done it this way and been successful?” has been and always will be a sure-fire recipe for stagnancy and eventual decline.

Still, there are bright spots that happen when the way forward is illuminated by maverick law firms that, determined to pursue active and solvent futures, acknowledge a nodding acquaintance to the existence of data but, much more importantly, have the intestinal fortitude to break free of it to think differently, act accordingly, and shatter the mould that defines structures and cultures that confine exponential growth.

These traits are the hallmarks of law firms of the future.

Focus and Act

Distractions are aplenty in the legal services sector, which is why the topic of private equity is “flavour of the [ insert whatever timeline you want ]” and feeds into many lawyers’ professional and personal quirk of admiring the problem (for ages) before hammering out potential solutions, and discussing them ad nauseum before acting.

The problem right now is that the legal services sector is at a precipice. As noted in “Pyramid,” the traditional law firm pyramid structure is rolling over and will upend like an iceberg and by 2030, global legal services will operate much differently than they do now.

While I’m not advocating for private investment, law firms losing their lower tiers of legal talent along with operational stability due to the twin juggernauts of artificial intelligence and pricing are well-advised to consider PE for potentially better and sustainable business solvency. Yes, some degree of control will need to be forfeited to ensure better evolvement and survival, but that’s how both business and life works.

Time’s Up

Lorenzo Pietro “Yogi” Berra, an American baseball player who was probably more famous for his witticisms than his sport suggested, “When you come to a fork in the road, take it.” Applying that wisdom to legal services where, up to this point, many traditionally structured law firms have been successful by fluke rather than design, we’ve finally come to a critical fork in this sector’s road where law firms are now being forced by clients and the legal market itself to choose if and how they change.

There are essentially two paths: One leads to carrying on business as usual and hoping to survive the disintegration of an historically flawed and rapidly destabilizing traditional pyramid structure. The other requires vision, grit, and determination to change the business, its models and flexibility as well as welcoming a multidisciplinary and constantly shifting talent roster to work with and within newer, flatter legal services structures that merge with the modern world to realize solvent and successful futures.

The choice is yours. Choose wisely. Be fearless.

This second piece of a two-part column first appeared on Slaw, January 2026. Part One, The Law Firm Pyramid Rollover, was published November 2025.

Both columns formed the basis of my keynote presentations at law firm Partner Retreats and speaking engagements at legal conferences in 2025 that culminated in an address — The Tide Turns: How Disruption in the Legal Industry Impacts Traditionally-Structured Law Firms. This address explores what artificial intelligence and pricing compounded by continuing transience within the legal service sector’s workforce and private equity participation means for traditionally structured law firms and how they need to adapt, as well as what non-traditional legal services providers do differently that enables them to better accommodate industry-altering change.

Ontario law firms are seeing meaningful changes in how the LSO Spot Audit and Practice Review programs are being administered. According to the Law Society of Ontario, these changes reflect a broader shift toward risk-based, data-informed regulation. As a result, oversight is becoming more focused on measurable indicators and areas where issues are more likely to arise, rather than applying the same level of review across the board.

The Law Society is moving toward a compliance framework that emphasizes early detection, proportional oversight, and proactive support. Lower-risk firms may be selected for remote Check-Up reviews, while higher-risk firms or those with prior deficiencies are more likely to undergo full onsite audits.

New sole practitioners are no longer automatically audited in their first year. Instead, they are required to complete the Foundations for a Law Practice course, with audits triggered by risk indicators rather than timing alone.

As firms enter the new year and complete year-end housekeeping, this is an ideal time to consider these recent changes and how this more targeted, data-driven approach is shaping the administration of LSO spot audits, particularly as it relates to how firms manage their practice bookkeeping and trust accounting.

The Law Society now uses up to 10 years of historical data to help identify practices more likely to experience books-and-records deficiencies.

Indicators may include:

• Sole practitioners handling real estate matters
• Practices involving estates or Powers of Attorney
• Trust accounts with overdrafts or outstanding deposits
• Client trust ledgers that have remained unchanged for extended periods

While the audit cycle remains risk-based, selection is now more data-driven and targeted than in the past.

A More Streamlined Audit Process

The audit process itself has been refined to improve efficiency and focus:

• Scope now targets the most common and higher-impact deficiencies
• Overlapping procedures between spot audits and practice reviews have been reduced
• Audit steps have been consolidated to limit unnecessary administrative burden

This allows greater attention to be placed on material compliance issues rather than lower-risk items.

Audit Format: Remote, Onsite, or Hybrid

Spot audits may now be conducted remotely, onsite, or through a hybrid approach. Currently, approximately 25% of audits are conducted onsite. Format selection is based on practical considerations, such as tight timelines, difficulty obtaining records electronically, or accommodation requirements, rather than preference.

The Check-Up Program (for Lower-Risk Firms)

For firms assessed as lower risk, the Law Society has introduced a condensed audit model known as the Check-Up Program. These reviews:

• Are conducted remotely
• Focus primarily on trust accounts
• Are based on prior compliance history and regulatory profile
• May be escalated to a full audit if significant deficiencies are identified

This approach allows oversight to continue while minimizing disruption for well-managed firms.

Common Risk Areas Identified During Audits

Law firms should regularly review their processes around:

1.  Monthly trust reconciliations
2.  Commingling of client and firm funds
3.  Timely deposit of client retainers
4.  Proper authorization of trust transfers
5. Complete and up-to-date client trust ledgers

Repeated or uncorrected deficiencies, particularly those involving trust accounts, can lead to increased scrutiny.

Inclusion of Paralegals in the Spot Audit Program

Historically, spot audits applied only to lawyers. As of 2025, paralegals who handle client money are also subject to the Spot Audit Program, creating more consistent oversight across both professions.

Changes to the Practice Review Program

The Law Society has expanded the use of random practice reviews, which are not triggered by complaints but selected as part of its proactive quality-assurance process. These reviews have proven more effective at identifying competence issues than re-entry reviews, which have now been eliminated.

Selection is informed by risk indicators such as:

• Firm size, particularly sole practitioners and small firms
• Career stages where risk increases, specifically around the 10-year mark and again after 40 years of practice.
• Practice areas with higher complaint or insurance claim activity (for example, real estate and civil litigation)

This allows regulatory resources to be directed where issues are statistically more likely to arise.

Clearer Scope and Reporting

The Practice Review Program has also been streamlined to improve usability:

• The scope has been streamlined, with 72 detailed questions now grouped into 19 broader categories.

• Reports are shorter, clearer, and easier to follow
• Each report includes links to practical guidance and support resources
• Recommendations are more focused and easier to implement

Final Thoughts

The Spot Audit and Practice Review programs remain core quality-assurance tools for the Law Society. While they serve different purposes, both are intended to support professional competence, protect the public, and identify issues early so they can be addressed before escalating into more serious non-compliance.

The Law Society has consistently emphasized that these processes are not intended to “catch” licensees. When approached properly, they can help strengthen internal systems, improve trust accounting controls, and reinforce good practice management.

Rather than applying a one-size-fits-all model, the modernization of the LSO’s Spot Audit and Practice Review programs reflects a move toward oversight focused on where issues are most likely to arise. These updates are in response to significant shifts in the legal profession, including recent growth in the number of lawyers, increased reliance on technology, and the normalization of remote work, all of which have added new complexity to practice management.

Nonetheless, firms that embed strong bookkeeping, trust accounting, and internal controls into their day-to-day operations are better positioned to experience streamlined, less frequent audits and reviews.

Tell us a bit about your company.
Schooley Mitchell is North America’s largest independent cost-reduction consultancy. We help professional services firms optimize their operational expenses in areas such as telecom, merchant services, shipping, software, supplies etc. to prevent vendor overcharge. With an average client savings of 28% and a completely contingency-based model, we provide a risk-free path to a leaner, more profitable firm. If we don’t find you savings, there is no fee.

What makes your product or services a good fit for the legal sector?  
Firm managers are incredibly busy. Our service model allows them to either validate their efficiency OR save substantial amounts of money.  The Schooley Mitchell process can also save managers time since we deliver these savings without additional tasks being added to their to-do list.

What’s one recent success story or project you're especially proud of?
We recently saved a large legal firm over $118K annually across a variety of expense categories including merchant services, small package shipping, and waste.

What are some common challenges you help law firms solve?

• Service contracts are intentionally confusing. We translate them into plain English, so you know exactly what you’re paying for.
• Most firms do not have the time to spend hours looking through monthly invoices, line-by-line and then dealing with issues or errors. Our team will do this, and hold the vendors accountable, for you.
• Vendors often raise rates incrementally over time. We stop this "price-creep" by holding vendors accountable to the rates and caps we’ve negotiated.

Why did you choose to partner with TLOMA?
Legal Office Managers are the backbone of firm efficiency and the decision-makers who care most about firm health. We want to be a resource for them to help their firms remain optimized and competitive.

What advice would you offer legal professionals navigating today’s evolving workplace?
With hybrid work, and frequent turnover, firms are often paying for services like software seats or phone extensions for employees who are no longer there. So ongoing validation of your optimization is a must.

What's something most people wouldn’t guess about you or your company?
I don’t suspect people would guess the impact that we’ve had. After 28 years, Schooley Mitchell has delivered over $1 Billion in documented savings to over 35,000 clients.

If your company had a theme song, what would it be?
It would be “Dirty Work” by Steely Dan. Analyzing invoices, setting time aside to contact and negotiate with vendors can all be viewed as “dirty work”. Law office managers are far too busy for that. Schooley Mitchell will do this for you and is only compensated through a share of the savings.

When you're not working, where would we find you?
You’d likely find us spending time with our friends and families, reading a book, enjoying a good espresso, or a round of golf.

How can TLOMA members connect with you?
Members can reach out directly via our provided contact information, or via our LinkedIn profiles.

What’s one trend you’re watching closely in the legal industry (or your field of expertise)?
It is the shift toward AI across industries. Everyone is running towards AI adoption without a clear picture of: 1) how they will use it, or 2) the accuracy of its results. In our field, we’re watching how vendors are using AI to hide small fee increases and how we can use our own tech stack to stop it. We see this particularly in professional services industries where profit margins tend to be higher and less likely to be questioned.

What’s a common misconception about your product/service that you’d like to clear up?

Here are two of the most common misconceptions we hear about:

• "It’s too good to be true." Since we work on contingency, people think there’s a catch. There isn't - we simply share in the success we create.
• People think they need to switch vendors to save money. However, over 80% of our clients achieve these savings (~30%) without ever needing to change vendors.

What’s the best compliment you’ve ever received from a client?
It’s great when we hear the phrase “I thought we were already getting the best rate”, but the real compliment is the lightbulb-moment on our clients’ faces when they see how much they’ve saved.

As a new partner with TLOMA, what are you most looking forward to?
Building strong relationships, and a reputation as a trusted advisor, not just another vendor.

If you had a magic wand to instantly improve one thing in law firm operations, what would it be?
It would be to achieve optimal operational efficiency. Wouldn’t it be great to have everything run smoothly every day! As a plus, it would also be great to standardize all invoice formats. It shouldn't take a PhD to understand the services you’re being charged for.