December 2, 2008 5:07 PM

EXCLUSIVE: White & Case to Undergo Major Reorganization

Posted by Ben Hallman

Change is coming to White & Case, and the name of that change is middle management.

Under a new structure put in place this week, firm power will shift away from 35 individual offices and be dispersed among 14 regional groups. There also will be a renewed focus on 16 different global practices, identified by firm chairman Hugh Verrier and other partners in leadership positions as those critical to the firm's future success. The moves come in the wake of a four-month review of White & Case's strategy and structure by McKinsey & Co., a consultancy.

"The day of the brick and mortar approach to building a global law firm is over," says Verrier, who spoke about the reorganization for the first time on Tuesday in an exclusive interview with The Am Law Daily.

For a quarter century, since it took its first steps on a path to becoming a global law firm, White & Case's far-flung offices have operated as individual fiefdoms, with little directive from above on how to grow business, choose clients, or cut costs. But with 2,500 lawyers spread around the world and growing competition from other, more-focused global powers, White & Case's leaders felt a review of the business was in order, Verrier says.

The firm decided to open itself to analysts from McKinsey. Over a four-month period, from April to July of this year, the consultants interviewed 250 partners, more than half the partnership, and carefully examined and analyzed White & Case's books.

Verrier says the lawyers in charge of the process wove the McKinsey recommendations that came out of the analysis, issued in August, with their own ideas about how the firm must change course. (Verrier declines to discuss the details of McKinsey's suggestions). Still, McKinsey's fundamental recommendation--that the firm reorganize itself to better operate as a global law firm--is present in the new structure.

Under the reorganization, each White & Case lawyer will join one of 14 regional groups, as well as one or more practice groups. Each regional group will be led by a section head for a one or two-year term. Regional heads will produce their own profit and loss reports, and be responsible for managing their groups as a business. They will also maintain their law practices. (A PDF detailing the regional and practice groups and the lawyers leading them can be downloaded via  link below.)

"Accountability is at the core of this," Verrier says.

Additionally, the firm is launching five client teams charged with serving those clients the firm believes could most benefit from a cross-firm focus. Those clients are: Novartis AG, Panasonic Corp., Qatar Investment Authority, and UBS AG.

White & Case has a similar head count, about 2,000 lawyers, as global firms like Linklaters, but it is not as profitable, even though profits have increased at a healthy clip in recent years. In 2007, the firm posted a revenue per lawyer number of $720,000, up eight percent over the year before. Still, Verrier thinks the firm isn't as efficient, or as interconnected as it could be. "We are not comfortable with the status quo," he says. "Our peers have taken leaps forward through sharper focus and discipline."

In recent months, White & Case has shuttered three offices, in Dresden, Milan, and Bangkok, and three weeks ago, it announced layoffs affecting 70 associates and 90 staff. Verrier says the decisions were independent of the McKinsey review.

Download W&C Regional-Practice Groups.pdf

--Additional reporting by Jeremy Hodges, Legal Week

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