The Cravath Model and the Challenge of Volatility

By: Jay Harrington. Jay is the leader and founding Partner of Latitude’s Detroit office. A former Big Law attorney and founder of a boutique law firm, he has spent more than 25 years practicing law and advising lawyers and legal organizations on strategy, productivity, and practice growth. He is the author of The Productivity Pivot, The Essential Associate, and One of a Kind.

I started my legal career as part of the system I’m about to describe. As an associate at one of the world’s largest law firms, I saw what it builds: rigor, skills, and institutional knowledge that compound over the years.

Indeed, what the Cravath Model gets right is foundational. It’s a traditional law firm staffing approach: Hire high-potential young lawyers. Train them well. Expose them to sophisticated matters under close supervision. Invest in mentorship. Over time, a portion of those lawyers become partners and carry the institution forward.

That long runway has produced extraordinary practitioners and some of the most respected brands in professional services. The model works. For more than a century, it has been the way to build a durable law firm.

At its core, however, the model assumes a degree of predictability. During times of volatility—which we’re seeing more of in today’s market—that assumption requires closer scrutiny.

A Model Built for the Long Term

Law firms invest heavily in young lawyers, expecting returns over time. The structure is intentionally long-term.

But it is also, by design, a fixed-capacity system. A firm’s core capacity—consisting of its full-time lawyers—does not expand or contract quickly without consequence. That is the tradeoff inherent in building institutional depth.

The challenge arises when the external environment becomes less stable than the internal structure was built to accommodate.

When Volatility Tests the System

The past several years has provided a clear illustration of this tension. COVID disrupted workflow, staffing, and client activity almost overnight. Then an extraordinary transactional surge occurred in 2021 and 2022. M&A and capital markets activity exploded, prompting firms to hire aggressively to meet demand.

In 2023, IPO markets and deal volume slowed dramatically. Many firms found themselves recalibrating headcounts in corporate practices, while other areas, including restructuring, regulatory enforcement, and litigation, began to accelerate. Demand shifted quickly.

These shifts were not the result of poor planning. They reflected broader economic forces that were difficult to predict. Almost every firm was affected because the system built on multi-year talent-recruiting and development cycles was forced to deal with rapid fluctuations that unfolded over quarters, not years.

Similar patterns appear on a smaller scale every day. A single matter can require substantial staffing for six to nine months. Unexpected associate departures can strain a busy team. A regulatory development can generate a surge of work that may taper off within a year. In each instance, firms must respond quickly while protecting quality and client relationships.

Traditional responses—lateral hiring, accelerated recruiting, internal reallocation—are rational and often necessary. But they are rarely fast or durable. Meanwhile, the client’s needs are immediate.

Elasticity and Workforce Design

What this really boils down to is a need for workforce design that increases the system’s elasticity. Core associate capacity is largely fixed. When firms respond to short-term spikes by permanently increasing headcount, they convert temporary demand into long-term cost. If demand later shrinks, the imbalance remains. When firms choose not to add capacity, the cost appears elsewhere—in overextended associates and potential client dissatisfaction.

The Cravath Model was simply not designed to function as a way to rapidly respond to changing talent needs.

This is where flexible legal talent fits, not as a replacement for the associate-to-partner structure, but as support when the model is strained. There is now a meaningful group of lawyers who were trained in traditional law firm environments and know that level of practice well. They’ve handled complex matters, worked with demanding clients, and operated at a high level. Many could have stayed on the partnership path. Some chose instead to structure their careers differently while continuing to do sophisticated work.

At Latitude, these are the lawyers we employ and deploy. They bring the training and judgment that firms expect, but they’re applying it in a different way through contract engagements supporting sophisticated law firms and corporate legal departments.

For firms facing temporary surges in demand, that cohort represents experienced, flexible capacity that can be deployed quickly and scaled appropriately. This enables firms to integrate lawyers on an as-needed basis who already understand how top-tier firms operate, without adding permanent fixed costs to the balance sheet.

As a result, this approach strengthens the long-term model rather than undermining it. When surge work is absorbed by experienced flexible lawyers, core associates are less likely to be stretched beyond sustainable limits. The institutional core remains protected.

Institutional Strength and Flexibility

The Cravath Model continues to do what it has always done well: build institutions.

But no long-term system is optimized to absorb every short-term shock. In a market defined by faster business cycles, tighter client scrutiny of legal spend, and greater associate mobility, resilience requires both depth and flexibility.

Strong firms depend on tradition. Resilient ones also embrace thoughtful innovation. Flexible talent isn’t a replacement for the long-term model. It’s a practical way to strengthen it in a less predictable market.