[Editor’s note: This is one of a series of occasional guest posts by Sam Glover, founder of Lawyerist.]

There are lots of good reasons for law firms to work on diversity and inclusion, but here is one more: the data is pretty clear that diverse teams have a competitive advantage over homogenous teams. (That’s why it’s one of the elements of the Small Firm Scorecard.)

In 2016, the Harvard Business Review summarized a number of studies. The gist of its findings is that diverse teams tend to stay objective and make better decisions. And diverse teams are more innovative. You can read the article for more details, but the gist is that diversity helps keep bias from interfering with decision making, and more viewpoints result in more ideas, which lead to more innovation. The bottom line is that companies that do better on diversity also tend to do better than average in the market.

So what is it about diversity?

Checking Assumptions and Staying Objective

For one thing, diverse teams seem to encourage everyone to check their assumptions and stay objective. This isn’t only true when race is at issue, such as one study in which a jury considered a murder where the defendant was black. As you might expect, a jury with both black and white jurors did better on fact-finding than an all-white jury. But in another study, ethnically diverse teams did a better job pricing stocks than homogenous teams. And in still another study, teams made up of fraternity or sorority members were more likely to identify the correct murder suspect if a newcomer from another fraternity was added to the team.

My read on this is that in diverse groups the members of the group are less comfortable with each other, and as a result the group is more careful with facts and takes the time to check assumptions. That leads to better decision making. As the authors point out in another article, the challenge is to build diverse teams that share a set of core values so that the discomfort is productive, not corrosive.

The Antidote to Groupthink

Diversity also seems to be an antidote to the kind of groupthink that stifles innovation. The relevant studies in the HBR article are based on data rather than behavioral experiments, but two separate studies found that companies with greater gender or cultural diversity were more likely to introduce new innovations or products into the market.

It makes sense that people who experience the world differently are likely to imagine different solutions to problems, and that some of those solutions will succeed. For example, the typewriter, the telephone, and email were at least partially solutions to problems experienced by people with disabilities (Pellegrino Turri’s blind lover, Alexander Graham Bell’s deaf wife and mother, and Vint Cerf’s deaf wife). Not surprisingly, since each of these technologies is now fundamental to our modern world, Microsoft’s inclusive design philosophy is based on the idea that seeing the world through the eyes of people with disabilities is the key to solving problems we all have.

Similarly, people with different skin colors or ethnic backgrounds, gender identities, disabilities, socioeconomic circumstances, etc., are likely to come up with different solutions to problems as well as different problems that need solving. The result: greater innovation.

Getting Smarter with Diversity

If you want to take advantage of diversity at your firm, you’ll need to do (at least) these two things:

1. Build a Diverse Law Firm

Sam Glover

Unless your firm is already diverse, this is probably easier said than done. It is also a huge subject, and I can’t begin to do it justice here. However, as Heather Hackman pointed out in this conversation, you can’t just “do diversity” by forcing a bunch of different people together, counting noses, and declaring victory.

You have to do the hard work. Put your firm under a microscope to discover and eliminate hidden bias. Learn to embrace diversity as a firm resource.

As part of your work on diversity, work on your core values. The healthy discomfort that can come with increased diversity should be balanced by a strong set of shared core values.

2. Bring in Fresh Perspectives

To counter groupthink, bring in someone outside the team to contribute a fresh perspective, especially when you are making important decisions. Lawyers sometimes have it easy here, because clients often have a very different — but very important — perspective. In making their case to the newcomer, the team will have to re-evaluate their assumptions.

Add someone who has a fresh perspective after the team has begun its work, so the newcomer does not have enough time with the team members to become assimilated into the group.

Diversity as a Strategy

It takes time and hard work to build a diverse and inclusive firm. But the data seems pretty clear that it also may give you a leg up on your competition, whether you are in the courtroom or working on your law firm’s business strategy.

[Editor’s note: This is the first of a series of occasional guest posts by Sam Glover, founder of Lawyerist.]

If we are near the beginning of a dramatic transformation from the “traditional,” lawyer-centric legal market into a tech-enabled, client-centric market, then everyone involved in law faces a fork in the road.

(By now you will have heard all the arguments for why law is changing, so I will skip the usual recitation of technological marvels. Ooh smartphones. Taxis suck. Blockbuster is dead. Etc.)

On one side of the fork is the highway of the traditional law-firm model. On the other is the exit ramp to the surface streets of innovation. In 2018, the highway traffic may be slowing a bit and the potholes may be multiplying, but it’s hard to tell and not everyone agrees. It still looks like a pretty safe road to success. Plenty of traditional firms are still making plenty of money with traditional client-service models.

But the surface streets have a lot going for them, too. If you hit all the lights, you can get where you’re going faster than you can on the highway. More companies, like LegalZoom and DoNotPay and Hello Divorce, are taking the exit. If someone drops Waze into this metaphor, the surface streets might even start winning more often than not. But it’s far from a sure thing. Yet.

Pick a Fork

You have to take one of the two forks — the traditional model or innovation. This is true for law schools and firms of all sizes, but it is especially true for legal tech companies. For all their talk of innovation, though, most legal tech companies are still on the highway. After all, that’s where their customers are.

Sam Glover

Right now, traditional law firms dominate the legal market. That means if you are a business-to-business legal tech startup, those are your customers. If you want to build a product for lawyers, your customer persona is probably going to be a tech-savvy but otherwise fairly familiar law firm.

Consider the law practice management software market, for example. We’ve gathered the options on Lawyerist.com, and what you’ll notice is that all of them are built for traditional firms. Yes, they all promise high-tech efficiency, but that means saving time, not changing the underlying client service model. Those products are only built for the law firms of the future if you think the law firms of the future are just the law firms of today with a few upgrades. Heck, most of them are still built around timekeeping and the billable hour. And they are probably right to do so, because they are taking the highway.

So are the law firms of the future just law firms as we know them, but with a few new tech-enabled tools? That’s not a transformation. It’s barely evolution. In order to survive the transformation of the legal market, firms will have to be upgraded, but they probably won’t dominate the legal market the way they do now.

The longer we act as if all firms need are a few upgrades, the easier it will be for others to lead the transformation and end-around lawyers. Law schools, startups, and law firms (and perhaps one day soon, outside investors) investing in traditional law firms may be unwittingly contributing to their own demise.

Building for a Market That Doesn’t Exist (Yet)

Of course, there is at present no innovative-legal-services market demographic to serve. The client service models of the future are still being dreamt up. You can’t build a legal tech product for a market that doesn’t exist. You can’t train law students for jobs that don’t exist.

And yet …

There is no reason to assume that the only way to get clients from Point A (their problem) to Point B (their problem, solved) is the highway of traditional practice. On the surface streets there are blue oceans around every corner.

Maybe you don’t need to build a legal tech company around making traditional law firms more efficient. Maybe you don’t even need to sell your product to law firms or lawyers in order to make your legal tech startup a success. Maybe your students will start the next innovative law firm instead of applying for jobs at traditional ones. Maybe you can provide a compelling alternative to traditional firms to the consumers or businesses in your market and rewrite the rules of competition.

The way to build the future of law practice is to build it, not to sell as many seats as possible to a shrinking market demographic before it goes.

So which fork is your company (or law firm or law school) building for?