How Law Firms and Lawyers Can Improve Their Productivity

Episode Notes

Transcript

Law Technology Now

How Law Firms and Lawyers Can Improve Their Productivity

08/05/2016

[Music]

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Bob Ambrogi: Hello. I am Bob Ambrogi.

Monica Bay: And I am Monica Bay.

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Bob Ambrogi: Here on Law Technology Now.

Monica Bay: Hi. I am Monica Bay and welcome to Law Technology Now. I have a fantastic guest today, Charles Duhigg. Thank you for coming today! Thank you.

Charles Duhigg: Thanks for having me!

Monica Bay: Oh, it’s my pleasure. We had the great opportunity, you were so kind, I believe, it was 2014, where you came to Legaltech New York and did a fantastic, absolutely excellent speech. You had the keynote there, and everybody was absolutely raving. So I know you have a little experience in the legal community.

One of the reasons I was very excited to have you come on our show is because of your new book ‘Smarter Faster Better’, and I think there is a lot of relevance for the entire legal community and especially big law from your book.

Every time when I came across one of your segments I thought, wow, lawyers need to know this. So I want to talk to you a little bit today about that. And one of the things that faces the legal community right now is, across the board, 80% of Americans cannot either find a lawyer or can they afford a lawyer. And there has been a lot of critics who are saying we need more tech, we need to revise the way that legal works, we need to have it not be so heavily about billable hours, so forth and so on. James Sandman is a huge advocate for this. He is the President of the Legal Services Corporation.

So my first question for you is, from your point of view, is there anything that jumps out at you that you think is important for lawyers to know with your two books ‘Smarter Faster Better’ and ‘The Power of Habit’?

Charles Duhigg: So I am actually from a family of lawyers. I have spent most of my life around lawyers and almost became a lawyer myself and most days regret not having actually finished law school. I just took a handful of classes.

So this is something I think about a lot. My sister, my brother, my mother and my father are all trial lawyers in Albuquerque, New Mexico. And I think the things that strikes me is that whether you are a trial lawyer who is sort of — whose economic drivers are contingency fees or whether you are a lawyer for a big firm, where you are thinking about — you bill yourself hourly or whether you are someone who does public service and pro bono work, a lawyer fundamentally is dealing — all lawyers are dealing in the same commodity, which is time.

At the end of the day the reason why the law is so fascinating is because it’s something we can’t automate it. It’s something that for the most complex questions we need to have people making great decisions, we need to have lawyers who are trained in the law making decisions and choices to help those of us who don’t have law degrees figure out how to navigate through it.

And I think that anyone whose profession is predicated upon making choices about how they spend their time has to think about how to become more productive. And the truth of the matter is that we all have the same problem, which is that there is only 24 hours in each day, whether you are President Obama or whether you are a Supreme Court Justice or whether you are a writer like me, we all only get 24 hours.

And so the question becomes, and this is kind of what motivated writing ‘Smarter Faster Better’ was this question of, why do some people seem to use those 24 hours better than others, why do they seem to get so much more done? And what the research findings indicates because we are kind of living through this golden age of understanding the neurology of productivity and the organizational management of productivity is that the most productive people tend to be the ones who paradoxically find routines or habits that allow them to think a little bit more than everyone else.

And I think probably everyone listening to this has had this experience that in today’s economy, it is possible now to be busy every minute of every day. You can respond to every email, you can deal with every meeting that comes up, every request that comes in, but we all know that the peoples who are most productive are the ones who manage to take a step back and say, no, I need to prioritize, this is what’s important, that isn’t. I don’t need to deal with all those emails, I can do this instead. Giving yourself routines that allow you to think, that’s what makes a difference between busyness and productivity.

(00:05:07)

Monica Bay: When I read both of the books I was just so mesmerized by the application in so many different areas and in both of the books, I really love both of them.

The first book I was particularly moved by the Alcoa story. Can you tell us a little bit about that and what Paul O’Neill, and it’s not the Paul O’Neill from the Yankees, it’s another Paul O’Neill.

Charles Duhigg: Right, right, the other Paul O’Neill, the one who was the Treasury Secretary. So before Paul O’Neill was Treasury Secretary under Bush, he was the CEO of Alcoa, which is one of the largest aluminum companies in the world. And what I love about this Alcoa story is that it sort of demonstrates this central idea which is that, when it comes to organizations, there is a huge amount of research to suggest that leaders rather than focusing on trying to create widespread change, ought to try and focus on creating one kind of change.

And that if you change the right organizational habits within a company or an organization that it seems to set off a chain reaction sometimes. It changes other patterns as well. And within the academic literature these are known as keystone habits; these habits that seem to have a disproportionate power.

So when Paul O’Neill comes into Alcoa, he is a guy who actually doesn’t have much background, any background really in manufacturing. He had been the head of OMB under President Carter and President Jonathan. He comes in and he had worked previously at a paper manufacturing plant, and then he comes in as the CEO of one of the largest aluminum companies on earth. And when he steps into this role, everyone figures he is going to focus on increasing profitability or efficiency or getting better quality products or customer service, but instead in his first meeting with shareholders he says, the thing I want you to judge me on is whether I can improve our worker safety habits. I want you to judge this company based on whether we stop injuries from happening at all.

Now, anyone who has been in an aluminum factory knows it’s this incredibly dangerous place. It was not unusual for Alcoa, which had hundreds of thousands of employees, to have as many as one critical injury or death per month in the company. And Paul O’Neill comes in and he says, look, I have got to change this company. There is a dozen things I want to change. But if I go to the workers and I say, I want you to become more profitable, they are going to tell me to go stuff it. And if I go and I say to the managers, I want to focus on customer satisfaction, they are going to tell me, look, my job is to run a factory, not to worry about that.

But employee safety, employee safety is basically something everyone agrees on, because guys on the factory floor, they don’t want to feel like they are in danger, and managers, managers actually want to take care of their people. Nobody can disagree with employee safety.

And he says, look, here’s how I think we should change employee safety. I want us to create the best quality workforce, a place where no one ever gets injured, and the only way we can do that is by studying how to make our process more efficient, how to do everything right, how to never have an accident or a mistake, because accidents are mistakes, that’s where people get hurt.

Now, the brilliance of this is that by saying I want to focus on worker safety, what he is really saying is these factories need to become more efficient. They need to become better, they need to become cleaner, they need to become more predictable.

By focusing on worker safety Paul O’Neill actually starts looking at these other things that he wants to change, but he does it in the language of worker safety, in the habits of worker safety, in something everyone can buy in to.

And in doing so, not only does he make Alcoa into the safest company on earth, not just the safest aluminum company, the safest company. You had higher odds of injuring yourself as an accountant than you did making aluminum at Alcoa.

He also makes it one of the best performers in the Dow Jones Industrial Average, because we all know that at the end of the day in order to have a safe workplace, you usually have a really well functioning workplace.

Monica Bay: In your new book, which is again, ‘Smarter Faster Better’, you have really a fascinating section about plane crashes and a plane that did not crash; Air France 447 and Qantas 32. Tell us the lessons that the legal profession can learn from those two airplanes.

Charles Duhigg: Well, it’s interesting. So Air France Flight 447, most people will probably remember, is the flight that crashes into the Atlantic Ocean, and what’s interesting about that flight is that there was nothing wrong with the plane. It’s a situation where the pilots created an emergency almost entirely.

And then we can contrast that with another incident, Qantas Flight 32, which you mentioned, which is one that most Americans aren’t familiar with, but is really well-known in Australia, because it was an Australian airline, where this airplane actually had the worst midair mechanical disaster in history, basically a fan blade inside one of the engines shot off of the main cylinder and like poked a huge hole in the wing of the plane.

(00:10:02)

And the pilots in that case were able to land the plane without one injury, and so the question then becomes why these different outcomes? Right? What explains why some people make mistakes and other people don’t?

And what researchers have found is that a lot of that has to do with how actively they create for themselves what are known as mental models or put differently, with how much degree of specificity do they tell themselves a story about their life as their life is occurring, how much do they visualize what they expect to have occur.

Now a lot of what we know about building mental models comes from things like studies of firefighters. One of the things we know is that the best firefighters, expert firefighters when they walk into a room where there is a fire, they immediately start telling themselves a story about what they expect to see. They say, okay, in the left corner I think I am going to see flames and in the right corner there is a staircase and I expect to see that burning even faster because stairs burns fasters than anything else. And then when they walk into that room and they don’t see as many flames on the staircase as they expected, some part of their brain immediately says, focus on the staircase, there is something wrong with the staircase, try and figure out what’s going on.

Or in studies of executives, there is big studies that have been done on Fortune 500 executives, and what they found is that the most successful executives tend to visualize their day with just a little bit more specificity than everyone else.

So, instead of saying like I have a meeting at 10 ’clock and then I have to meet a client at 11 o’clock. They say, okay, I’ve got a meeting at 10 o’clock and it’s going to start with Jim bringing up that dumb idea he always brings in and then Suzie is going to disagree with Jim because Suzie hates Jim, and then I am going to jump in with my idea and I am going to look like a genius.

It’s just like an extra 20 seconds of visualizing how this meeting is going to unfold, but we all know how powerful that is, that if you sort of have a plan in mind, if you have a mental model, a story you told yourself of how you expect things to unfold, not only does it make you more prepared for that meeting, it also makes you much better prepared when the unexpected happens. When your boss asks a question out of nowhere, or when someone says something you didn’t expect, you are able to kind of roll with it to anticipate and react to that surprise.

And that’s what the difference was between Air France 447 and Qantas Flight 32. In Air France Flight 447 the one that crashed into the ocean, you basically had some pilots who had no mental model whatsoever, they were pilots who had become trained to react, almost unthinkingly to all of the autopilots and technology around them. So when an alarm went off, they responded to that alarm rather than taking a step back and thinking, does this alarm makes sense? Like, is something happening here that actually I need to panic about or is it possible that there is a mechanical malfunction in the alarm system?

Whereas on Qantas Flight 32 where they were able to land this plane without any injuries when all of a sudden when the alarms did go off, the pilot, the main pilot, the Captain who is sitting in the cockpit, he is looking at all these alarms and what he decides to do is close his eyes for a moment and say, look, I can become overwhelmed by all the panic around me, I can stop thinking and just purely become reactive, but that’s going to crash this plane. What I need to do is, I need to take control, and to do that I am going to pretend that this plane is a Cessna, one of the simplest planes on earth, because imagining it as a Cessna if nothing else it helps me figure out what to pay attention to and what to ignore, and that’s how he landed the plane.

And for lawyers the same thing is true. You walk into office and your pockets are just buzzing for things that a 100 emails are waiting for you, there is 10 meetings that people are asking to come sit in on, you could spend your entire day simply reacting. But if you are someone who sat down and said, okay, here is how I think the day is going to proceed between 9 and 11 o’clock and here is my top goal, here is what I really want to get done.

When I go into this client meeting, I know that the client is going to be worried about, what this is doing to his business and I need to convince him to stop thinking about his business and instead start thinking about the litigation that we are dealing with.

Monica Bay: And it seem to me also in that section I was very moved on the Qantas one, about how they talked together as a team before they even sat down in their chairs.

Charles Duhigg: Well, that’s exactly right and this is what we know. I mentioned before that people who are most productive they have these contemplative routines, these routines that help them think. One of the most powerful routines is essentially just talking to other people in a way that gets them to question you and allows you to question them.

So the Captain of Qantas Flight 32, one of the things he would do is, as you mentioned before they got on to the plane, he would make all of his copilots tell him stories about what they were going to do in case of an emergency; where the first place that your eyes are going to go if Engine 2 goes out; if we have a loss of altitude, tell me the first words that are going to come out of your mouth? And then after they would tell him the story about what they are going to do, he would essentially argue with them, he would kind of push back and say, well, why is that the first you are going to say, why don’t you say this other thing or are you sure you want to put your eyes there, don’t you want to put your eyes over here?

(00:15:01)

And it’s this act of talking to each other, of questioning each other, of having these conversations that are kind of like intellectual sparring matches, that’s how we learn to become nimble and agile, that’s how we learn to pivot when we need to if our mental model isn’t working.

And the great thing about being a lawyer is that this is like second nature to argue the point and think of alternatives, this is the basis of how the law works. And it turns out that that act or arguing, that act of having an intellectual partner, that is what makes us smarter, that is a contemplative routine that we can build into our life that helps us become more mentally nimble.

Monica Bay: I want to switch speaking of pivoting here, but also kind of being on the same theme here. In your section where you talk about the kidnapping and how the FBI ended up with a one person completely changing all of the tech, and those of us who have been in law forever know that technology and fast are very rarely in the same sentence for anybody who is doing work in a particular law firm. Tell us that story, if you would.

Charles Duhigg: Well, so one of the interesting things about the FBI is that they have essentially changed to a completely agile methodology, not only and how they develop their technology but also in how they run the agency and how they empower investigators to do their work.

So, I think everything listening, if you are in technology, you know that there has been this huge shift from in how we plan technology to adopt a lean model or an agile methodology, where instead of saying, we are going to make all the decisions ahead of time, we are going to plan exactly how this thing is going to go, to saying, we are going to start down up half and we are going to ask the people who are closest to the problem to help us solve that particular problem.

And a lot of this actually interestingly started with auto manufacturing, particularly a Toyota plant in California named the NUMMI plant and what was then known as lean manufacturing, which is the precursor to agile methodologies. And what they basically said it was this insight that you can’t figure out all the problems you are going to experience ahead of time, so what you need to do is you need to empower people to solve problems when they come across them and then oftentimes the first person that come across the problem whether that’s a programmer or someone working on a factory floor or a junior attorney, that person actually can oftentimes solve that problem better than anyone else, because they are the closest person to it.

So, what does this mean for those of us who are working in technology, or who want to learn from examples like the FBI and their ability to sort of revolutionize how they integrate tech into their work?

Well, what it tells is that one of the best things that we can do is that we can try and empower the people around us to make great choices, that oftentimes if you are a junior FBI agent and you are chasing down a lead, it use to be that you are in a hierarchy and you had to ask for permission before pursuing a clue and what the FBI has said is, no, no, no, that doesn’t make any sense.

If you are chasing a lead you should be able to determine which clues matter, which don’t, you should develop your instincts, because your instincts are going to be better than some guys sitting in our office. Similarly, if you are working on a big lawsuit and I have friends who are in the situation and you have got a 100 lawyers working on it, or if you are trying to change the technology inside a law firm, it’s really tempting for the person at the top of the organizational chart to say, look, every decision has to be run by me, this is too important, I got to weigh it on and everything. But what we know about the most agile companies is that they tend to do the opposite, they tend to say, when you have a problem you can’t solve, then you come to me and ask my advice, but I am going to empower you junior attorney or junior technologist to at least take a first step at solving that problem because by virtue of the fact that you are closer to it, you probably see some innovations that would never occur to me.

Monica Bay: Well, I know we are running out of time but I want to ask you one more quick question really quickly. You preach in the first book and I think the theme goes through into the second, on, “Always take advantage of a crisis”, tell us a little bit about that.

Charles Duhigg: Well, I think this is just good sense for folks who have been through crises before. One of the things that we know is that in the midst of a crisis everything becomes more flexible, in the midst of a corporate crisis, suddenly people are willing to reconsider how they have been doing things for years. When individuals have crises, we know that those are times when their own personal habits are more likely to change, most people when they go through a health crisis or they are going to get divorced or something like that, that’s when they actually change their life much more than these other moments.

And so the problem with the crisis is that it’s super-unpleasant, like nobody wants to have a crisis just to make a change. So the question becomes, how can we learn from this without having to have everything go to hell, and the answer is that you can create the perception of a crisis. You can create the conditions of a crisis without actually having to experience one and make folks flexible.

(00:20:11)

When you hear Tim Cook at Apple talk to his troops, he never talks to the company about how great they are; he always says, you know, we are doing well right now, but tomorrow, tomorrow there could be some new startup that would put us out of business in three years.

He creates the perception of a crisis when one doesn’t even exist, because he knows in doing so he is helping his people become flexible. People do the same things. You sit down and you say, oh gosh, I have been eating really unhealthily for the last decade, and I haven’t had any heart attacks, nothing, but I have a doctor’s appointment coming up in a month and I just know it like that doctor, he is going to tell me that my health is not great unless I start eating vegetables and exercising right now.

Now, nobody knows that, there is no doctor who tells you that you are out of the blue, your health isn’t good and you have got a problem, but by creating this perception the change is important and needed, we make it easier to accomplish. And that’s the important lesson is that never let a crisis go to waste, never miss that opportunity. But more importantly, think about how you message things to yourself and to your employees, because if you can create the perception of a potential crisis, then you help people get down the path of change.

Monica Bay: Charles, thank you so much for your time. And once again, the books are ‘The Power of Habit: Why We Do What We Do in Life and Business’ and ‘Smarter Faster Better: The Secrets of Being Productive in Life and Business’.

Charles, can you tell us a little bit about how to contact you?

Charles Duhigg: They can get a book at Amazon or any bookstore, Barnes & Noble that they live near, any of their preferred booksellers or  HYPERLINK “http://www.audible.com” audible.com, if they want to listen to it. And I am [email protected], I would love to hear from folks.

Monica Bay: Terrific. Well, thank you so much. I wish I had five hours to go on this and I am looking forward to the — do you know what the next book will be?

Charles Duhigg: I don’t yet, if you do let me know.

Monica Bay: Thank you so much.

Charles Duhigg: Thank you. Take care.

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