Legend has it that Southwest Airlines started with a business plan sketched on the back of a cocktail napkin up by founders Herb Kelleher and Rollin King back in the mid-1960s. Back then, the federal government regulated airline rates, keeping prices so high that only the wealthy could afford to fly. Kelleher and King wanted to make flying cheaper but in order to slash prices, they needed to circumvent the federal caps. So they created an airline that flew only within the state. By the time deregulation rolled around in 1978, Southwest already had a well-developed system for beating the competition on price:
They strategically enter regions by purchasing terminal space in airports that offer it for less. They then steal the ticket bookings away from their competitors with much lower fares. Southwest flies “point to point”, unlike the hub-and spoke model of most other airlines. They also fly only one plane, the Boeing 737, enabling their pilots to fly any plane at any time. They serve no meals, only snacks. They charge no fees to change tickets and have no assigned seats.
Southwest is often used as an example of a successful business that started out without an extensive plan – a lesson now embraced by many startups. But Southwest teaches another far more important lesson for solos and smalls practicing in this evolutionary time in the legal profession: the importance of skating where the puck is going, not where it has been.
Although Southwest focused the initial iteration of its low-cost airline model on regional markets to avoid federal price caps, that couldn’t have been its strategy for the long haul. Instead, Southwest bet that the industry would deregulate – and when it did, Southwest’s already-well honed Texas prototype would give it an enormous over competitors. Southwest bet right.
Today, I see lots of lawyers who balk about modernizing either their practice or practice areas. The cloud? Nah – not clear if it’s ethical or if clients will want it. Social media? Eh – just a fad for kids. Outsourcing – don’t trust that. Self-scheduling appointments – no one’s going to use it. And yet these changes are coming. Maybe not all of them. Maybe you’ll bet wrong. Maybe you’ll be, as I was with MyShingle (launched in 2002 before most lawyers even read blogs) a decade too early. So what?
There’s so much to be gained from first mover advantage. And with today’s technology, it’s easier than ever to test the waters with a new practice area or new business model. Curious about virtual law practice but unsure whether your clients will bite? Set up a portal as a trial. Interested in helping clients with digital asset planning but the law hasn’t yet been adopted in your state? Survey the demand for this area of practice and then lobby the legislature yourself to adopt a law to to facilitate digital asset estate planning. Got an idea for your practice that is inconsistent with existing ethics rules? Put the pieces in place and then get the rules change.
The future isn’t static or pre-ordained. Technology is one piece of the puzzle that changes the future, but so do laws and regulatory policy and human nature. And even if the change hasn’t yet happened, we need to start planning now so that when change does happen (or when we make it happen), we’ll have an edge. What if the cloud were compelled? Where would your firm be?
But predicting the future isn’t just about keeping pace, it’s also about gaining an advantage. Companies like Southwest and SunEdison gets that and Uber gets that (hey, look at all the regulatory counsel Uber is hiring). Do you?