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Report: Superior client service top priority for majority of midsize firms
For midsize law firms, key priorities for 2025 are talent retention and superior client service, new research from Actionstep has revealed.
Lauren Croft
Actionstep has released its second annual 2025 Australian Midsize Law Firm Priorities Report, which reveals a number of key insights into the midsize legal sector across the country.
The research, conducted in partnership with Agile Market Intelligence, surveyed 400 legal professionals from midsize law firms with 20 to 250 employees. The study included a variety of practice areas, roles, and generations and explored what success looks like in midsize firms, said Actionstep global president David Hepburn.
“As law firms adapt to changing client expectations and grapple with the fast pace of technology advancements, our research highlights the importance of understanding what truly drives success – whether it’s leveraging the right talent, optimising processes, or utilising technology in ways that align with the firm’s goals,” he said.
“Through this report, we aim to provide actionable insights that help firms achieve those outcomes in 2025 and beyond and hope the findings inspire new ideas and strategies. By exploring the report, firms can take advantage of its insights to benchmark performance, refine strategies, and prepare for the challenges and opportunities ahead.”
According to the report, 79 per cent of midsize firms intend to win new business through superior client service – with 51 per cent confirming that the primary factor in winning new clients is their law firm’s specialised expertise. Moreover, 71 per cent said client satisfaction is their top priority for protecting their revenue in 2025 – and 37 per cent said their main strategy for revenue growth over the next year would come after “deepening relationships” with clients.
“For midsize firms with expansion ambitions, sustainable revenue growth must be an essential part of their strategic plan for 2025. A major finding in this study is that firms plan to achieve this by strengthening relationships with existing clients. High client satisfaction, driven by robust client relationships, remains a key to protecting and expanding revenue,” the report said.
In addition to client service and revenue growth, the report showed that for 59 per cent of midsize law firms, attracting and retaining talent is a top priority. Forty-five per cent said talent recruitment and retention is a core strategic challenge for their firm.
“According to our data, firms are investing in quality staff and efficient processes to meet high client expectations. However, time constraints continue to be a major challenge, with 74 per cent of respondents identifying workload and time limitations as barriers to delivering exceptional service.
“The correlation between talented staff and high-quality client service underscores a commitment from law firm professionals to long-term, sustainable growth. However, law firm professionals also report that recruitment and retention are the biggest challenges they face,” the report said.
Despite this challenge, only 13 per cent of respondents said they plan to leave their firm in the next 12 months; however, attrition rates were revealed to be higher among Gen Z legal professionals.
In terms of staying at a midsize firm, 62 per cent of respondents cited “engaging work” as the primary factor, more so than pay, work/life balance, or even firm culture and leadership. For Gen Z, the top motivator to stay was career progression.
For employees contemplating leaving their firms within the next year, 62 per cent said pay was a major influence, in contrast to the 50 per cent who considered it a primary reason to stay. This was true for 75 per cent of Gen Z respondents compared to 64 per cent of Millennials, 54 per cent of Gen X, and 58 per cent of Baby Boomers.
“Interestingly, only 18 per cent cited the lack of engaging work as a reason for considering leaving, confirming that many employees find their work inherently engaging. However, for some, even engaging work does not outweigh the perceived negatives, such as financial compensation,” the report said.
“To bridge this gap, midsize firms may need to consider bolstering pay structures or improving overall compensation packages. Implementing cost-saving measures through operational efficiency and automation could support these initiatives, helping firms invest back into competitive talent retention without sacrificing profitability.”
More to come.
Lauren Croft
Lauren is a journalist at Lawyers Weekly and graduated with a Bachelor of Journalism from Macleay College. Prior to joining Lawyers Weekly, she worked as a trade journalist for media and travel industry publications and Travel Weekly. Originally born in England, Lauren enjoys trying new bars and restaurants, attending music festivals and travelling. She is also a keen snowboarder and pre-pandemic, spent a season living in a French ski resort.
