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What Do Your Clients Consider to Be “Good Value” When It Comes to Legal Services?

In September, 2008, the Association of Corporate Counsel (ACC) formally launched its “Value Challenge” initiative with a goal “to reconnect value and costs for legal services.” At the time, many in the legal media declared that this would be the beginning of the change in the way law firm’s act as a business. They predicted that we would soon see the mass implementation of alternative and fixed fee arrangements, lowering of costs and increased efficiency. We’re five years on and there has not been nearly the movement the ACC had hoped, especially in regards to Canadian firms.

And so, it should come as no surprise to anyone that Daniel Desjardins, senior vice-president and general counsel of Bombardier, has made the decision to step in to offer some advice to law firms. Mr. Desjardins is considered one of the best in-house lawyers in the country, was honoured with the Lifetime Achievement Award at last year’s Canadian General Counsel Awards, and has an in-house legal team of 175 lawyers.

His advice came in the form of a five page letter posted on the ACC website. In his letter, he reiterates succinctly what we all know about the market – that things aren’t what they used to be.

“This notable and growing shift toward insourcing is dramatically altering the nature of the legal work being outsourced. More often these days, outsourced work tends to be at one end of the scale or the other: Either the work is of lower perceived value and treated as a commodity, or it is significantly strategic that it requires the support of key partners and specialists.

In addition, as many corporations expand nationally or internationally, in-house legal departments are adjusting their external legal spend. Often, their spend in foreign jurisdictions is increasing.

Taken together, the globalization of legal services, the emergence of the in-house law department as the manager of core legal services, and the insourcing of legal work have significant and serious consequences for law firms.” 

For those who us who have long been the proponents, and designers, of client feedback and key client programs in law firms , one of the overwhelming themes that shines through is the emphasis on client value. Mr. Desjardins explains it as such,

“Certainly, having external law firms provide legal services with true added value relative to the cost will benefit both the GC and the in-house legal team, as it will benefit the external law firm. Delivering what is really sought by their clients will, in turn, solidify the trust and the long-term relationship between the in-house legal team and the law firm. In short, having better suppliers makes us better.” 

The idea of value is relative and can be very specific. For example, if your client is a GC with a ‘bet the bank’ class action litigation, value may be achieved through a precedent setting win – no matter the size of the bill. Another example would be if your matter involves a family law client and value means not having the children dragged into the divorce proceedings. Value is not one size fits all.

But how can the law firm discover “what is really sought” by their clients big or small? That’s easy – simply ask.

As I described in a previous column, client feedback, and acting upon the feedback given, needs to become a natural part of your client service process. It can be integrated into many areas of client interaction, in a way that suits both you and your client, but it should be consistent and deliberate. As Mr. Desjardins points out;

“The feedback I’m getting from other GCs is that most often, listening to clients has been done on an ad-hoc basis, as opposed to a rigorous and steady fashion. To my way of thinking, however, the kind of two-way discussions I’m advocating should be more structured. This could even extend to the creation of an informal advisory board composed of a small group of key clients who meet with the leadership team once or twice a year, on specific issues as they arise, or to discuss the core strategy and long-term vision of the firm.”

So the question is this. Are you ready, and willing, to accept his challenge even at the most basic level? If the answer is yes, and you believe that it’s time to implement, or improve, your client feedback program, you should decide the direction and form it should take. A few areas that you should consider are as follows:

1. Program strategy and goals
Why are you establishing the program? What information do you want to glean? How will you incorporate your client feedback program into your wider client management and business development efforts?

2. Participants
Who will be asked to participate in your program? Are you looking only at your largest clients or across a larger section of clients? Is there room in your program for new clients and prospects?

3. Methodology
What methods will you use to implement your program? Are you considering client questionnaires which can be efficient to implement or in-person interviews which can be more time consuming but can yield more in-depth feedback? Will you use hardcopy surveys sent by mail or utilize an on-line survey program? Will your program contain a combination of methodologies? How often will you contact your clients?

4. Who will implement the program?
How does your client view the idea of client feedback? Will they be as willing to participate, and be as honest, if the program is implemented by your lawyers as opposed to an external consultant? If using in-house resources, do you have the skill set and time commitment necessary available? Will you use the relationship partner, other partner or business development resources of the firm?

5. Program reporting and follow up
Who will collect and evaluate the data received from clients participating in your program? How will you record the specific feedback from each client and ensure that any follow-up’s take place? What take-away will be registered from those clients who declined to take part?

Even if you simply ask your clients on a periodic basis, “How are we doing?” it would be a step in the right direction. That being said, I feel it’s only fitting for Mr. Desjardins to have the last word on the matter.

“A strategy and a solid action plan to understand the needs of clients that is well implemented would serve to solidify and deepen the existing and current relationship, as well as achieve the necessary financial results for the law firm.”

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Comments

  1. Melissa LaFlair

    An interesting update on the impact of the ACC Value Challenge initiative. While it is disappointing that the change has been much slower than originally anticipated, changing behaviour is easier said than done, particularly given the legal industry is steeped in tradition and based on precedent (which looks back, not ahead). It doesn’t help that lawyers are generally not suffering visible, immediate, dire consequences when they don’t change. Most dissatisfied clients quietly start migrating to another service provider in the hopes of finding better service rather than engage in what they expect to be a difficult conversation with a lawyer who “just doesn’t get it”.

    I fully support the idea of implementing a client feedback program. Unfortunately, despite the best of intentions and much effort putting together legally accurate work product, most lawyers often don’t really know if their clients are happy and many are afraid to ask them. These lawyers would view a client feedback program as the equivalent to opening Pandora’s box. Lawyers in that position may want to consider adopting something even more basic: a matter initiation checklist.

    By this I do NOT mean the traditional checklist that most lawyers use to make sure they know who the client is, that their fees will be paid and that they will be able to identify any conflicts. No, what I am referring to is a client-oriented checklist that a lawyer uses to make sure they understand their clients’ business needs, risk tolerance, primary objectives, cost constraints etc. at the outset of each matter. Frankly, whether they know their clients are happy or not I think every lawyer should develop a checklist for use at the beginning of each matter they work on.

    The initial discussion required by the checklist can help clients think through and articulate their needs and help lawyers identify in advance the time, cost and scope implication of what the client is seeking. Executed properly the checklist discussion enables the lawyer and their client to establish objective parameters that establish value and can be used to assess the success of the mandate. Armed with this information lawyers can then tailor their services and costs and meet client expectations. A true win-win outcome for all involved that has the added benefit of generating information that could benefit client feedback programs.

    At the end of the day, any and all tools that facilitate more effective discussions between lawyers and their clients is a move in the right direction for everyone.

    Melissa LaFlair

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