What it takes to run a business
Most of commercial awareness is understanding what it takes to run a business. A law firm is a business that provides legal expertise. If there is no income being generated in the firm, then it will not stay a float. This means it is crucial to understand what the clients need and deliver an excellent service to ensure the client provides future business and positive word of mouth. Delivering an excellent service requires the firm to know what is affecting the client and what is affecting the market to know how it might impact the services the firm delivers to the client. For example, over the last two years a lot of people have been buying up property in London, this is due to BREXIT causing the pound to drop so it has become significantly cheaper especially for international citizens since the pound became more on par with other currency. This would obviously affect legal professionals dealing with property and foreign exchange.
As with any business, there is a wide-open market with multiple companies providing the same service which provides clients with options. However, it provides competition between businesses competing for clients. If one company is unwilling to perform the service the client wants, then there will always be another company that will. This is why many mergers of law firms happen. To expand practice areas that were perhaps not offered at that firm but are offered at the firm they merge with. To become international is another reason which a firm will generally merge with a firm from a different country to expand their client data base and ability to provide service. Also, it is financially sometimes a smart move to merge if the business is currently not at optimal performance level.
The employees of a company are the face of the company and have the potential to make or break the company. The employees are the main point of contact for clients to deal with, and if the client does not enjoy their experience with an employee they might not come back. It is therefore important for firms to train their employees to a certain standard but also to ensure the employee’s overall satisfaction within the firm. If the employee is not happy at work with their employer, then it is likely they will not provide good quality service. This is why the interview process for training contracts is so important and so rigorous, the firm wants to ensure that you actually want to be at the firm long term. Will you be happy there? It is a financial risk for the firm to train trainees that do not plan on staying at the firm once qualifying or do not complete the training because they realize the job is not for them. As a future employee of a firm look at their hours, do your research on the quality of life at the firm to see if you would actually be happy there long term. Also do research into the different areas of law and be able to explain why you not only want to go into a certain area but why all other areas of law are not for you.
Example Questions to consider:
Differentiate between public and private sector organisations using examples.
Can you explain what a business is and how it operates?
How does the economy affect the company you are applying to?
How is the firm you are applying to different than all the other firms within the same area of law? A more practical example would be if you were only planning to apply to the magic circle firms; why is each of them different and why do you like that difference enough to apply?
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Every Friday will have a post on commercial awareness. Specifically, top news pieces for the week that you should be aware of. There will also be a monthly commercial awareness contest to keep you on your toes so stay tuned! If you have a commercial awareness post, you would like to share please email it to Brooke.McNeil@city.ac.uk. If you write for the blog 5 times you will be awarded with a certificate for your CV.