Focus on Clients: Creating a Law Firm from a Client’s Perspective

Lawyer's Row Historic Marker[This is the sixth and final post in a series of posts featuring a conversation with Susan Hackett of Legal Executive Leadership focused on deepening client relationships in meaningful (and profitable) ways.]

If clients have so many reservations about the way law firms currently work, what form of firm would work better for a client? This is the provocative question I put to Susan Hackett, inviting her to join me in a little blue sky dreaming. If a client could start their dream firm from scratch, what would it look like and how would it work?

Admittedly, it is hard for any law firm to remake itself overnight, but if a lawyer is serious about becoming her client’s dream external counsel, what should she do? Here’s Susan’s advice:

Build a firm that inspires a client to hire the firm, and not just some of its great individual lawyers.

So many clients `hire the lawyer and not the firm’; what kind of negative commentary is that? The firm and the individual lawyer should be equally important (and contributing) to a client.  In my experience, many great lawyers are sometimes left to swim against the stream in their firms: the fact that they want to try a new fee structure, rearrange and retrain the team serving the client, or revise business processes to achieve greater efficiency can put them at odds with the very business models of their firms. They are not compensated for making those changes, they are not supported in delivering services in new ways, they don’t have the backing of their colleagues.  I’d build a firm that rewards lawyers for innovation, creative client service, and proven performance against goals.  That means a firm that is just as fully committed to each client’s total satisfaction as the individual lawyers who work with those clients.

Build a firm that embraces technologies, and deploys both data and experience to rethink the processes and teams focused on client work.

This means conducting business process assessments to better understand the cost and price of work. It means using reliable data to support the firm’s calculations of internal profitability, as well as predictable matter budgets, cost controls, and pricing models for clients. It also means empowering staff and lawyers to examine and change pricing and performance standards in order to connect them more directly to results.

Build a firm that understands that knowledge and experience, applied with great judgment, are the foundation of the firm’s core value to clients.

I would make a huge commitment to establishing knowledge networks, experience pools, and knowledge management systems (with recyclable content) that would allow the great lawyers in my firm to spend more of their time focusing on what is different in each of their matters, rather than re-inventing or replicating that which is the same. I’d want them known for applying their mighty experience and judgment to the most complex and non-repetitive matters. I would not want to focus my firm on performing services that push the firm into a competitive spiral with legal process outsourcers in a race to the bottom. However, to the extent such services are requested by clients, I’d want my firm to have established efficient systems and competitive pricing for the performance of mid-level, `operational’ work that clients value, but only if its performance and pricing are predictable.

Build a firm culture that values that which clients value most in practice and professionalism.

This means building a firm with a strong focus on pro bono and public interest work, a commitment to inclusion and flexibility in work practices, a dynamic environment that thrives on innovation and creativity, and a compensation and promotion system that rewards great performance rather than large stacks of hours.  My ideal firm’s partnership (I recognize that in most US jurisdictions, this is not currently possible in a law firm) would likely include a significant contingent of leaders who are not trained as lawyers, but who bring all kinds of important disciplines to the firm: financial, technical, management, leadership, IT systems, HR, and so on.  In my firm universe, these professionals would be compensated and promoted based on the same scales and standards as their legal peers, for surely their contributions, if empowered, could be just as important to the firm’s success as the actual client services provided by the firm’s lawyers.

So there you have it:  a client’s view of a perfect law firm.  How does your firm stack up?

At the end of the day, while Susan and I have had a great conversation, it’s clear that this series of posts is just the beginning of what needs to be a much wider ongoing conversation among law firms and their clients. We invite you to to participate.

[Photo Credit: Jimmy Emerson]

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Focus on Clients: The Client’s View of Collaboration and Knowledge Sharing

triplet towers of paper [This is the fifth in a series of posts featuring a conversation with Susan Hackett of Legal Executive Leadership focused on deepening client relationships in meaningful (and profitable) ways.]

At a recent session on extranets at the ILTA 2012 conference, Lynn Simpson of DuPont started her portion of the presentation with the warning that she “was about to throw a bomb in the room.” She followed that warning with these words:

  • We don’t want you to send us poorly targeted, irrelevant marketing or legal updates. We consider that material to be the equivalent of spam.
  • It’s great that you have all these interesting extranets, but we don’t want to have to go to each firm’s special environment to find the materials we need to work. We want our external clients to come to our environment — the place where we, the client, are most comfortable working.

That should make everyone sit up and take notice!

And then what? Here’s some advice:

  • With a broadcasted email blast, the client is left trying to sift through a host of law firm updates in order to figure out which (if any) of these emails actually are relevant to the client’s work.  Speaking on behalf of clients everywhere, Susan says: “That’s your marketing, not my business interest.”
  • The better approach is for the client relationship partner to personally select the materials that are relevant to the client and then forward them with a covering note that explains the context and how it matters (or should matter) to the client.
  • Ask your client how their department organizes legal information. Are there gaps you could help fill?
  • Does your client have easy access to information relating to the matter you are working on? If not, discuss how you might make these materials available to them in a manner that is convenient for your client.
  • Are there basic knowledge resources or tools you could provide your client to allow a certain measure self-service?
  • Would your client be interested in a subscription service by which you regularly provided information useful to your client’s business operations?

While these are some preliminary suggestions, the bottom line is that each firm has to ask each of its clients for guidance on how best to share knowledge resources. It is now longer a matter of routine marketing. Instead, every action should remind your client of how well you understand your client’s business and how much you are willing to do to support your client’s work. Generic legal memoranda run the risk of sending a radically different message. Is that really what you want to do?

The next in this Focus on Clients series: Creating a Law Firm from a Client’s Perspective

[Photo Credit: artnoose]

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Focus on Clients: If You Delight Them They Will Stay

my one & only[This is the fourth in a series of posts featuring a conversation with Susan Hackett of Legal Executive Leadership focused on deepening client relationships in meaningful (and profitable) ways.]

Susan Hackett and I discussed in the prior posts in this series the proposition that the richest source of new business is found in referrals from existing clients. But what does that really entail? To dig deeper, we considered the following questions: What can you do to ensure that your current clients are

  1. Absolutely in love with you?
  2. Willing and able to recommend you to their colleagues?

 

Falling in Love

There are thousands of law firms and millions of lawyers. How can you stand out? What can you do to ensure that your current clients are absolutely in love with you (as opposed to thinking of you merely as a representative of one of 73 firms they work with who are doing just fine, but aren’t really “distinguishable”)? In answer to these questions, Susan offers the following advice:

First off, get over the `quality’ thing. I know you’re a great lawyer.  But let me share with you that I personally know about 5,000 great lawyers who offer their clients high quality services. And I certainly don’t know nearly everyone who’s out there. Quality is the floor; you have to build up from there to be distinguishable.

Second, open yourself to critical assessment of the value of your services and to ideas and practices you could implement to improve your value. When I say `value,’ I’m talking specifically about those things that go beyond the ability to write a great memo/brief or understand and explain complex regulation. I’m talking about whether the result of the service you provide to clients (which is what you’re responsible for providing, not a memo) drives a better outcome for them.  I like to say that most clients don’t think of the problems they have as legal problems; they are business problems. And they want solutions, not just advice. So if you’ve not thought about your value to the client’s business or the practicality of your service, you’re missing the point.  And you’ll be missing the referral.

Third, the very best way to deliver value to each client you serve is simply to ask them what it is that they value, what it is that you’re doing right or could do better, what it is that other lawyers or service providers offer them that makes them pleased with the service, and how it is that you personally could improve.  Ask it in person, ask it in surveys, ask it outside the course of matters, ask it during the matters on which you’re serving. Saying once a year over dinner, `so how are we doing?’ is going to get an answer as specific as `just great.’  Trust me, that’s not the feedback you need.

Sharing the Love

As we discussed in our earlier post, Help Your Clients Make Rain for You, the key to new business generation is ensuring your current clients are willing and able to recommend your services to their colleagues. Perhaps the biggest challenge is in the perception gap between how a law firm views the impact of services rendered and how the client views those same services.  According to Susan, this gap can be significant:

When outside counsel are asked how they think they’re doing in their client relationships, about 85% of them give themselves an A  grade.  When inside counsel are asked whether they would refer their outside counsel to another client, only about 35% of them would.  The fact that a client gives a lawyer or firm business and keeps returning for more services does NOT mean that the client loves that lawyer or firm.  And a B grade in today’s market puts you and your firm on the `danger’ list when it comes to which firms will be asked to leave the preferred provider pool as clients continue to winnow down the number of firms they use.

How can you raise your grade to an A or make sure you’re one of the 35% who is recommended? Susan suggests the following:

Asking for feedback is not the same thing as acting on it.  Too many of us ask for feedback and then we sit back and `admire’ (or ignore) the results. Instead, we need to take actions that allow us to improve from the feedback.  If you receive positive feedback, look for ways to apply the principles underlying your success to other kinds of work. At a minimum, when the evaluations relate to performance, include them in the performance reviews of those involved. After all, if lawyers’ compensation and advancement are only tied to the number of hours they’ve billed, and not to how well they serve clients, we’re all in trouble.

One critical element is to work with your client to develop a relationship of trust and collaboration. Since clients have the option to walk away from their external counsel, the load often falls on law firms to take the lead in establishing a value-based focus that works for both parties. To be successful, both sides must feel that the relationship ensures that all boats rise – that the firm will profit well from serving the client better: lowering or controlling costs, improving results and turn around time, creating new efficiencies, etc. While everyone talks about “partnering” and all this may sound obvious, Susan believes that too many firm/client relationships are defined by a “zero-sum” mentality – any concession to the client is seen as a firm “loss,” and any profitability or increase to the firm is seen as a client “failure” to secure the better deal.  In her view, that’s just bad thinking.

Next in this Focus on Clients series: The Client’s View of Collaboration and Knowledge Sharing

[Photo Credit: Jessica Lucia]

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Focus on Clients: Help Your Clients Make Rain for You

raining in baltimore [repost][This is the third in a series of posts featuring a conversation with Susan Hackett of Legal Executive Leadership focused on deepening client relationships in meaningful (and profitable) ways.]

Prospecting for clients is a project that many lawyers find challenging. The thought of meeting new people and selling business can be daunting for someone who only ever really wanted to be left alone to practice law. For these lawyers everywhere we offer some information and advice that should come as a relief. Rather than making cold calls, there is another much less painful and far more productive method for growing your business. The secret is to help your clients make rain for you.

In our conversation Susan Hackett noted that while attractive websites, insightful conference presentations and pleasant cocktail parties may increase a lawyer’s exposure to prospective clients (and thus certainly are laudable efforts), “new” client work comes from referrals by existing clients. In fact, Susan believes that most of her law department colleagues would say that they award an overwhelming majority of new work primarily on the basis of positive referrals by existing clients. Accordingly, firms that fail to earn referrals are not getting as much new work as possible, in spite of all the other “special sauce” things they might do.  This is advice no law firm can afford to ignore.

Most new business comes through referrals by existing clients.

For the nuts and bolts of how this works, I asked Susan to give us some insight into the process from the client’s perspective.

Some client referrals come in response to a direct inquiry by a prospective client to his or her colleagues asking: `Does anybody have any experience with a firm that does X?’  And some referrals come from the kinds of credentialing that help the retaining inside lawyer discriminate between contestants to choose the winner in a formal or informal RFP-type process.

While several firms may be considered by a client in either of the above scenarios, whether through a formal contest or through the in-house counsel’s network research, a selection from the group of well-qualified finalists usually is made only after a trusted colleague with experience using that firm directs or endorses the client’s decision by saying something like:  `I think they’re the go-to guys/gals for this project – talk to my gal Sally when you call.’  Any way you slice it, new business is predicated on the ability of the prospective client to validate the firm or specific external lawyers with trusted colleagues who currently use their services. Who are those colleagues? Your clients.

To be top of mind with your clients you have to do something more than simply provide the agreed-upon services or send a periodic passive newsletter that can be filed. You have to connect at the place where your expertise and excellent service meets the client’s pressing needs. The only way to ensure you’re hitting that mark consistently is to ask the client regularly`how are we doing?’ and then, most importantly, to act on the feedback and report progress to the client.

A recent LexisNexis Martindale-Hubbell survey of in-house counsel in Western Europe reported the following troubling information:

Most respondents were also very happy to participate in feedback programmes conducted by their law firms, although less than half had received an invitation to provide this. However, law firms appear to be even less committed to using customer insights to help strengthen their relationship. Only 28% of survey respondents said that their law firms came back to them to share the results and communicate improvements or changes that would be made as a result of feedback received.

That sounds like an invitation to a meaningful conversation with your clients. Will you accept?

Next in this Focus on Clients series: If You Delight Them, They Will Stay

[Photo Credit: Paul G]

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Focus on Clients: Making Rain by Making Conversation

St James's Park In The Rain [This is the second in a series of blog posts featuring a conversation with Susan Hackett of Legal Executive Leadership focused on deepening client relationships in meaningful (and profitable) ways.]

My post on the allure of “that new client smell,” (in which I pushed back on the notion that “new” clients are somehow better than old ones) led to a conversation with Susan in which she explained the issue from her perspective — namely, from the client side:

Being a successful rainmaker is invaluable in a desert. It also is seen as a ticket to success in law firms. But it has limited value in the eyes of the client. In fact, it can have a negative value. Law firms are often perceived as spending incredible amounts of time, energy and resource prospecting for new work, which could suggest to current clients that the efforts of their external counsel to pursue that ‘new car smell’ may be distracting their fullest attention from preventive maintenance of the vehicle responsible for getting the client around.  While partners are off looking for new attribution sources, clients may feel underappreciated, and that could have a devastating impact on work flow going forward.

Rainmaking flows from a steadfast focus on current clients.

As we talked, it became clear that while so much is made of the personal skills and attributes of the individual rainmaker, deeper reflection shows that a highly focused team approach to engaging, understanding and serving clients is key to growing your business. Susan doesn’t pull her punches in advising law firms:

In a shrinking market, before you even think about new business, you better make sure you’re not about to lose current clients first. As convergence trends move more client work to fewer and fewer preferred firms on the client’s roster, there will be a number of firms with long-standing, historically profitable and perfectly productive relationships who will wake up and find that they are one of the 50 firms that will no longer be getting client work as the client moves from 60 portfolio firms to 10 preferred partners.

For every lawyer who has been reluctant to ask the tough questions that initiate conversations that matter with a client, Susan provides some incentive to engage. What’s the nature of the incentive? The promise of clarity in your client relationship that leads to more business. Here’s how it works:

If you’re interested in business development, the people on whom you should be focusing 98% of your time and attention are your current contacts in existing client relationships for they are the keys to not only current revenues, but a great deal of future business.  To help unlock this business, focus on value.

It is imperative for firms to understand their value to their clients and how to both communicate and leverage that value going forward. You can best communicate your value to current and prospective clients by (1) conversing with your clients about what they value (asking questions and listening – not telling them what you think), (2) delivering service in a manner that meets or exceeds their expectations, and then (3) working with them to quantify value you have delivered in ways that can be demonstrated and validated for that client and prospective clients.

Next in this Focus on Clients series:  Helping Your Clients Make Rain for You

[Photo Credit: Garry Knight]

 

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Focus on Clients: Good Client Relationships Require Conversations that Matter

Evening sunlight & conversation, inside the Embassy There are at least two obvious strategies for growth: go wide or go deep. Go wide implies covering as much territory as you can, while go deep suggests mining your current location to extract as much goodness as possible. For many businesses, including law firms, go wide is their first impulse. Doing the hard work of attracting new clients can feel more manageable than doing what feels like the infinitely harder work of truly engaging with an existing client to deepen that relationship in meaningful (and profitable) ways.

I wrote about this phenomenon recently in a post entitled That New Customer Smell. That post led to several delightful and rich conversations with Susan Hackett. For those of you who haven’t yet had the pleasure of meeting Susan, let me introduce you.  Susan was for 22 years Senior Vice President and General Counsel of the Association of Corporate Counsel (ACC). Among her many accomplishments at ACC was the creation and adoption of the ACC Value Challenge (highlighting the need to link value to the cost of legal services). Susan is now CEO and Chief Legal Officer of Legal Executive Leadership, a management consulting firm that helps clients “find smarter ways to work,” build stronger legal teams and “promote thought leadership and collaboration in their work and workplaces.”

In her many years of close work with corporate counsel around the country Susan has learned a great deal about what law department executives expect from their external counsel. It was that perspective she brought to our initial conversations and agreed to share via this blog in a series we’re calling Focus on Clients. Over the next few days we’ll be posting on this blog highlights from our conversations, which examined how critical it is for external lawyers and their clients to engage in meaningful conversations with each other. Because, as with our personal lives, relationships deepen and grow through shared experience and conversations that matter.

Next in this Focus on Clients series: Making Rain by Making Conversation

[Photo Credit: Velvet Android]

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