**“In the past 10 years, and even in the next 10 years, scale has been one of the most important trends in the development of Chinese law firms. Among the largest law firms in China, many are those that were among the first partnership law firms in China. They seized the opportunities of the times and led the way in development.”
However, traditional large partnership-scale law firms are now facing various problems brought about by the new era. It is urgent to change minds and renegotiate strategies.
Recently, Liu Xin, the chairman of the fifth board of directors of Longan Development Fund and the management committee of Longan Guangzhou, gave an in-depth interview with the well-known legal media platform “Xinze”. Based on Longan’s practical experience, Director Liu Xin discussed with Yu Mingming, the founder of Xinze, aspects such as the advantages and challenges of traditional large partnership law firms, future development directions, trends in the law firm industry, and advice for young lawyers. The interview is over 12,000 words long and contains a lot of information. I hope it will be useful to everyone.”
Yu Mingming: The guest we invited today is Lawyer Liu Xin, chairman of the fifth board of directors of Longan Development Fund and the management committee of Longan Guangzhou. I have known Director Liu Xin for a long time. He has many ideas about the development of the industry and law firm management.
Longan is also a very interesting law firm. In the 2023 list of the 100 largest law firms in China released by Xinze in November, Longan has a large number of lawyers, ranking 11th nationwide. However, Longan is not on the list of the 30 largest law firms in China recently released by ALB. We know that ALB’s list requires law firms to apply themselves. If they don’t apply, they won’t be ranked. So, this may reflect a change in Longan’s attitude towards lists and scale rankings. This is what we hope to understand from Director Liu Xin.
Moreover, when we recently compiled the “2023 Report on the Scale Development of Chinese Law Firms”, we found that Longan Guangzhou has developed rapidly. In a short period, it has grown to a scale of nearly 200 people. So, I am also curious how Director Liu Xin has implemented his ideas successfully.
Therefore, today I would like to discuss with Director Liu Xin several topics: As a law firm that has been in operation for 31 years, how does Longan plan its development? What does Longan think of the label of “large-scale firm”? What has been done well in Longan Guangzhou’s rapid development? Finally, as a senior lawyer in the industry, how does Director Liu Xin view the current situation and future of the law firm industry?**
01 Advantages and Challenges of Large Partnership Firms
Yu Mingming: Welcome, Director Liu Xin. First, please introduce yourself briefly to the friends in the live broadcast room of the “Big Fish” chat room.
Liu Xin: Hello everyone. Just now, Big Fish mentioned that Longan is a long-established brand with 31 years of history. But actually, I have been in Longan for less than 3 years. I am a “new member” of Longan. After leaving the court, I have been working in law firm operation and management. Later, I left the law firm industry and engaged in business for 10 years—not because I love business, but because I wanted to exercise myself at a higher level and then be able to engage in law firm work better. So, now I have returned to the law firm industry and joined Longan.
Yu Mingming: Thank you, Director Liu Xin. As I mentioned earlier, Longan has a large number of lawyers, ranking 11th nationwide. But Longan is not on the list of the 30 largest law firms in China in 2023. What is going on? How does Longan view scale rankings?
Liu Xin: Actually, we really value scale rankings because they reflect the brand influence and market competitiveness of the law firm. As for why Longan is not on this list, it is mainly because the fifth board of directors of Longan completed its renewal in late June 2023. The new board has some new working concepts. We propose to suspend all award applications and evaluations during the first year of this board’s term.
Why did we make this decision? Longan has been on various lists and award applications for a long time, and always ranked high. I am worried that we might lose ourselves because of these honors. I hope we can calm down, reexamine ourselves, and think about what Longan has left and what should be done when we stop relying on these lists, rankings, and awards. Therefore, we do not apply for this ALB list.
Of course, some people may ask, if we don’t apply for lists and rankings, why is Longan on the Xinze list? Actually, it is because the list rules of Xinze and ALB are different. Xinze’s list is based on public data from the National Lawyer Integrity Information Publicity Platform. Law firms don’t need to apply. If a law firm doesn’t apply, ALB cannot obtain the data to rank.
We are very grateful and recognize the attention paid by third-party institutions to the topic of scale. For example, Xinze’s rankings and research on law firm scale have provided useful references for the development of law firms and promoted the further development of the law firm industry. Therefore, Longan will always value the rankings and award evaluations of third-party institutions with credibility and influence, such as Xinze and ALB. Longan will not apply for this list this year to better improve itself, so that it can participate in valuable lists and awards with a better attitude and performance next year. I believe Longan needs the attention of the market, and the market also needs Longan.
Yu Mingming: Whether it appears on the list or not, we must admit that Longan is a large-scale firm. So, how does Longan view “scale”? What is the significance of scale?
Liu Xin: First, I would like to talk about my understanding of scale. The ideal scale I envision is high-quality scale. It must meet at least three criteria. First, there must be a certain number of people. At least 1,000 lawyers and more than 10 offices. Second, a reasonable regional layout. That is, the locations of branches should be strategically important. Third, a certain level of integrated operation ability.
The reason why high-quality scale must meet these three criteria is that only in this way can the significance of scale be realized. What is the significance of scale?
First, externally, it increases the brand strength of the law firm and the coverage of market competition.
Second, internally, it promotes the formation of an internal cooperation market within the law firm. It is very helpful for lawyers to expand their business and also improves the professional division of labor of lawyers. When it is difficult for lawyers to survive, it is unrealistic to require them to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their professional expertise to create professional advantages, so that people recognize and cooperate with them.
Finally, internally and externally, when choosing a more professional lawyer and team for a business, the quality and customer satisfaction of the business will be higher. Moreover, what is more interesting is that once the internal cooperation market mechanism is formed, lawyers will actively explore their professional positioning and depth, and create professional advantages. This reflects the confidence and support of internal cooperation. In other words, internal cooperation is not just about “dividing the cake”; more importantly, it is about “enlarging the cake”.
Yu Mingming: Scale is always a means. It must serve the better development of the law firm.
We know that Longan was established in 1993. It is one of the first partnership law firms in China. It is not only a large firm but also a “old firm”. So, in your view, what are the main advantages and challenges of traditional large partnership law firms in the current industry environment?
Liu Xin: The advantages of traditional large firms are definitely very obvious. First, the depth of brand accumulation. Building a brand takes time. Longan’s brand has been refined over 31 years, and its value is very high. Second, the depth, breadth, and professionalism of talent accumulation. The advantages of traditional large firms in this regard are particularly obvious. Third, the first-mover advantage in scale. Longan now has more than 2,100 lawyers and 36 offices. Its market coverage is very significant.
The challenges faced by Longan also involve many common problems of traditional partnership large firms, namely the iteration and upgrading of the rights and interests mechanism, decision-making mechanism, and execution mechanism.
The common characteristics of traditional partnership law firms can be summarized in eight words: equal amounts, equal parts, collective investment, and autonomy. Under these characteristics, some problems may occur in law firms. First, the rights and interests are very scattered and not concentrated. Second, there are many opinions. If people have different ideas, the decision-making cost will be very high. Third, if partners don’t get along, it is more difficult to “split up” than to get divorced. Finally, they have to work together.
Why do these problems occur in traditional partnership law firms? There are two core reasons.
**First, it relates to the characteristics of our lawyer group. Most lawyers highly dislike risk. Since a law firm is established, money is spent in all aspects. This leads partners to attract more people to join to diversify risks. What people say is “people together”, but what actually happens is “money and resources”. This埋s a “mine” for the future. There are many people with different ideas, and it is unrealistic to require lawyers to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their expertise to create professional advantages, so that people recognize and cooperate with them.
Yu Mingming: Whether it appears on the list or not, we must admit that Longan is a large-scale firm. So, how does Longan view “scale”? What is the significance of scale?
Liu Xin: First, I would like to talk about my understanding of scale. The ideal scale I envision is high-quality scale. It must meet at least three criteria. First, there must be a certain number of people. At least 1,000 lawyers and more than 10 offices. Second, a reasonable regional layout. That is, the locations of branches should be strategically important. Third, a certain level of integrated operation ability.
The reason why high-quality scale must meet these three criteria is that only in this way can the significance of scale be realized. What is the significance of scale?
First, externally, it increases the brand strength of the law firm and the coverage of market competition.
Second, internally, it promotes the formation of an internal cooperation market within the law firm. It is very helpful for lawyers to expand their business and also improves the professional division of labor of lawyers. When it is difficult for lawyers to survive, it is unrealistic to require them to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their expertise to create professional advantages, so that people recognize and cooperate with them.
Finally, internally and externally, when choosing a more professional lawyer and team for a business, the quality and customer satisfaction of the business will be higher. Moreover, what is more interesting is that once the internal cooperation market mechanism is formed, lawyers will actively explore their professional positions and depth. This reflects the confidence and support of internal cooperation. In other words, internal cooperation is not just about “dividing the cake”; more importantly, it is about “enlarging the cake”.
Yu Mingming: Scale is always a means. It must serve the better development of the law firm.
We know that Longan was established in 1993. It is one of the first partnership law firms in China. It is not only a large firm but also a “old firm”. So, in your view, what are the main advantages and challenges of traditional large partnership law firms in the current industry environment?
Liu Xin: The advantages of traditional large firms are definitely very obvious. First, the depth of brand accumulation. Building a brand takes time. Longan’s brand has been refined over 31 years, and its value is very high. Second, the depth, breadth, and professionalism of talent accumulation. The advantages of traditional large firms in this regard are particularly obvious. Third, the first-mover advantage in scale. Longan now has more than 2,100 lawyers and 36 offices. Its market coverage is very significant.
The challenges faced by Longan also involve many common problems of traditional partnership large firms, namely the iteration and upgrading of the rights and interests mechanism, decision-making mechanism, and execution mechanism.
The common characteristics of traditional partnership law firms can be summarized in eight words: equal amounts, equal parts, collective investment, and autonomy. Under these characteristics, some problems may occur in law firms. First, the rights and interests are very scattered and not concentrated. Second, there are many opinions. If people have different ideas, the decision-making cost will be very high. Third, if partners don’t get along, it is more difficult to “split up” than to get divorced. Finally, they have to work together.
Why do these problems occur in traditional partnership law firms? There are two core reasons.
**First, it relates to the characteristics of our lawyer group. Most lawyers highly dislike risk. Since a law firm is established, money is spent in all aspects. This leads partners to attract more people to join to diversify risks. What people say is “people together”, but what actually happens is “money and resources”. This埋s a “mine” for the future. There are many people with different ideas, and it is unrealistic to require lawyers to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their expertise to create professional advantages, so that people recognize and cooperate with them.
Yu Mingming: Whether it appears on the list or not, we must admit that Longan is a large-scale firm. So, how does Longan view “scale”? What is the significance of scale?
Liu Xin: First, I would like to talk about my understanding of scale. The ideal scale I envision is high-quality scale. It must meet at least three criteria. First, there must be a certain number of people. At least 1,000 lawyers and more than 10 offices. Second, a reasonable regional layout. That is, the locations of branches should be strategically important. Third, a certain level of integrated operation ability.
The reason why high-quality scale must meet these three criteria is that only in this way can the significance of scale be realized. What is the significance of scale?
First, externally, it increases the brand strength of the law firm and the coverage of market competition.
Second, internally, it promotes the formation of an internal cooperation market within the law firm. It is very helpful for lawyers to expand their business and also improves the professional division of labor of lawyers. When it is difficult for lawyers to survive, it is unrealistic to require them to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their expertise to create professional advantages, so that people recognize and cooperate with them.
Finally, internally and externally, when choosing a more professional lawyer and team for a business, the quality and customer satisfaction of the business will be higher. Moreover, what is more interesting is that once the internal cooperation market mechanism is formed, lawyers will actively explore their professional positions and depth. This reflects the confidence and support of internal cooperation. In other words, internal cooperation is not just about “dividing the cake”; more importantly, it is about “enlarging the cake”.
Yu Mingming: Scale is always a means. It must serve the better development of the law firm.
We know that Longan was established in 1993. It is one of the first partnership law firms in China. It is not only a large firm but also a “old firm”. So, in your view, what are the main advantages and challenges of traditional large partnership law firms in the current industry environment?
Liu Xin: The advantages of traditional large firms are definitely very obvious. First, the depth of brand accumulation. Building a brand takes time. Longan’s brand has been refined over 31 years, and its value is very high. Second, the depth, breadth, and professionalism of talent accumulation. The advantages of traditional large firms in this regard are particularly obvious. Third, the first-mover advantage in scale. Longan now has more than 2,100 lawyers and 36 offices. Its market coverage is very significant.
The challenges faced by Longan also involve many common problems of traditional partnership large firms, namely the iteration and upgrading of the rights and interests mechanism, decision-making mechanism, and execution mechanism.
The common characteristics of traditional partnership law firms can be summarized in eight words: equal amounts, equal parts, collective investment, and autonomy. Under these characteristics, some problems may occur in law firms. First, the rights and interests are very scattered and not concentrated. Second, there are many opinions. If people have different ideas, the decision-making cost will be very high. Third, if partners don’t get along, it is more difficult to “split up” than to get divorced. Finally, they have to work together.
Why do these problems occur in traditional partnership law firms? There are two core reasons.
**First, it relates to the characteristics of our lawyer group. Most lawyers highly dislike risk. Since a law firm is established, money is spent in all aspects. This leads partners to attract more people to join to diversify risks. What people say is “people together”, but what actually happens is “money and resources”. This埋s a “mine” for the future. There are many people with different ideas, and it is unrealistic to require lawyers to give up and focus on professionalism. When a large internal cooperation market atmosphere is formed, lawyers will naturally actively define their professional positions and deepen their expertise to create professional advantages, so that people recognize and cooperate with them.
Yu Mingming: Whether it appears on the list or not, we must admit that Longan is a large-scale firm. So, how does Longan view “scale”? What is the significance of scale?
Liu Xin: First, I would like to talk about my understanding of scale. The ideal scale I envision is high-quality scale. It must meet at least three criteria. First, there must be a certain number of people. At least 1,000 lawyers and more than 10 offices. Second, a reasonable regional layout. That is, the locations of branches should be strategically important. Third, a certain level of integrated operation ability.
The reason why high-quality scale must meet these three criteria is that only in this way can the significance of scale be realized. What is the significance of scale?
First, externally, it increases the brand strength of the law firm and the coverage of market competition.
Second, **internally