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Thursday Thinkpiece: Jordan Furlong’s 3 Key Components of a Client Strategy

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LAW IS A BUYER’S MARKET: BUILDING A CLIENT-FIRST LAW FIRM

ISBN: 978-0-9953488-0-6. 244 pgs. Softcover.
© Copyright 2017

Jordan Furlong

Excerpt: Chapter 10, pages 132 – 139.
[Footnotes omitted.]

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When building a Client Strategy, your firm needs to employ the following three key components of your Client Strategy. These are practical, actionable aspects of your strategy, the tactics through which you achieve the strategy’s purpose. Your Client Strategy must include, but need not be limited to, these components.

You need to choose specific objectives for each component, identify the metrics by which you’ll measure progress against these objectives, and assign a senior person within your firm to monitor their implementation and report the results to the firm’s leadership on a regular basis.

1. Client intelligence

Recall the purpose of our modern law firm from Chapter 7: “To serve the interests of clients in our chosen markets by addressing their legal challenges and opportunities, so that those clients can achieve their objectives.”

What are those interests? What are those objectives? Law firms learn the answers to these questions through the collection and maintenance of intelligence. Your firm’s client strategy hinges on knowing your buyers’ identity, circumstances, and goals, so that you can best anticipate and respond to their needs.

(a) Identity: Who is the client? Choose one of your firm’s corporate clients at random and ask yourself the following questions about it. What does it do? When was it founded? Where is it located? How many people does it employ? In what jurisdictions does it operate? Who are its customers? Who are its suppliers? What is its inventory of products? What is its range of services? What is its stock price (if publicly traded)?

These are examples of questions that go to the identity of the client. They comprise a snapshot of the client at a moment in time (and of course, new snapshots should be taken regularly, so that the picture remains focused and fully up to date).

The answers to the most important of these questions should be known by all the people in your firm who serve the client and should be easily accessible to anyone else in the firm who’d like to learn. Why? Because they’re really important to the client, and therefore they should be important to your firm.

(b) Circumstances: What is the client’s environment? Here are some more questions about your randomly selected client. What is its competitive position within its marketplace (leader, middle of the pack, trailing)? Who are its main rivals? How much market share does it own? Where has it opened or expanded operations recently? Where has it narrowed or closed operations? What legal proceedings or investigations is it facing?

These are examples of questions that go to the client’s interactions with other market players and its own customer base. Your clients don’t exist in a vacuum; they act upon, and are acted upon by, countless other market events and participants every day. If “identity” is the snapshot of the client, then “circumstances” is the background of the picture, and that background should be deep, detailed, and definitive.

(c) Objectives: What are the client’s goals? What is the client’s corporate purpose and long-range destination? What market position does it ultimately seek? What is its strategic plan? How is that plan proceeding? These are examples of questions that go to the client’s big picture. If “identity” and “circumstances” are a photograph, then adding “objectives” turns this into a moving picture, with a plot, protagonist, and destination.

But we’re not done yet. Now ask: Why is the client seeking the particular legal services at hand? What does it hope to accomplish or avoid with these services? Where do they fit within the client’s growth and risk profiles and long-term objectives? What priority does the client place on them? These are examples of questions that look behind the request to find the reason. They that should be asked and answered during the initial retainer conversations with the client for this matter.

Make it standard practice for your firm to collect and reflect on this information for each of its key clients. Keep this information in a database accessible through a secure online dashboard to all members of the firm (and to the client, where possible), update it frequently, and make it a policy that everyone who deals with the client reviews the information during the engagement.

2. The client experience

How the law firm interacts with its clients is almost as important as the quality and effectiveness of what the firm delivers. This is one of the most important realities to emerge from the rise of the buyer in the legal market. The client’s experience of using the firm plays a significant role in determining the client’s satisfaction and its inclination to use the firm again.

The experience of clients when using your firm — essentially, what they find your firm is like to deal with — has a direct impact on the firm’s reputation, brand, prestige, and success. Whether the firm, through its people and its various points of contact, proves to be accessible or responsive or error-prone or pleasant or expensive or whatever else, that is how clients think of the firm and it’s what they tell others.

Never mind your marketing slogans and advertising campaigns. Your firm, in the eyes of the market, is defined not by who and what you say you are, but by who you actually are and what you actually do.

A good law firm “user experience” (UX) is easy, fluid, productive, and pleasant for the client; a poor law firm UX contains bottlenecks, breakdowns, missed signals, and frustrations for the client. But unless the firm is deliberate about its design and takes pains to be aware of its UX, it won’t know whether it’s delighting its clients or driving them nuts.

Here are ten elements of good law firm design for your consideration — call it a “Client Experience Checklist.”

  1. Responsiveness. Client inquiries of all kinds receive a prompt response, preferably within a defined time frame and from a previously designated individual. No waiting around wondering if anyone will call or email back.
  1. Satisfaction. The client gets an answer to the question it asked, not to the question the firm wishes it had received. No need to repeatedly rephrase a request, in hopes that maybe the firm will get it this time.
  1. Billing. The client receives invoices for the law firm’s work as soon as possible, electronically, and with sufficient detail. No paper bills three months after the fact for long-forgotten tasks.
  1. Pricing. The client receives a price for the law firm’s work that is rational, reliable, and transparent. No guessing about what fee the hourly rate will generate or shouldering 100 percent of the burden of risk that the scope of the engagement will change.
  1. Accessibility. The client can obtain real-time updates on the status of the work it has commissioned and the progress of the bill against budget. No having to pick up the phone to the lawyer just to find out where everything stands.
  1. Contact. The client has a single point of contact for all inquiries, and that point of contact has a single delegate. No wondering which person to email for information, or contacting several people and sowing internal confusion about who should reply.
  1. Consistency. The client receives a consistent customer experience across the board, no matter which people or processes the client encounters. No wide variations in your experience depending on whom you’re dealing with and how they feel that day.
  1. Familiarity. The client safely assumes that firm personnel have absorbed the appropriate intelligence about its operations. No wasting billable hours bringing new people up to speed on the situation.
  1. Assurance. The client is never to be taken by surprise — ever. No unexpected bills, no unexpected amounts in an expected bill, and no bad outcomes without prior warning or expectations management.
  1. Benefits. The client receives complementary benefits proportionate to its investment with the firm: free CLEs for client personnel, free market intelligence, free check-in calls from partners. No paying for what the firm already has and can afford to give away.

Your firm’s client experience needn’t include every item on this checklist, but it should contain at least some — if you’re not sure which ones, ask your clients which they’d prefer.

3. Results

Intelligence is important. Design matters. But the ultimate currency of buyer satisfaction is now and always will be the results delivered to and the value realized by the client. If you’re not tracking the results you achieve for your clients — and their satisfaction or lack thereof with these results — you’re missing out on literally the most important thing your clients care about. Your law firm’s Client Strategy will succeed in direct proportion to the firm’s ability to measure its success at meeting client requests.

One simple way to go about tracking your results would be to create a separate chart or spreadsheet for each client and make a new entry for each standalone retainer or engagement by that client. The spreadsheet should be made available in a secure online location to which both the client and the law firm have access, with the following questions as headings.

(a) What was asked? A summary of the client’s direction, as set out more fully in the retainer agreement or memo confirming the scope of the engagement. If the client modifies its request after commencement of the retainer, create a new entry directly beneath the original one and start again.

(b) Who is involved? A list (with contact information) of the key individuals working on the engagement, including any lawyers and staff with more than minimal involvement and the key representatives on the client side.

(c) What was promised? A summary of the firm’s undertakings in response to the request. Make separate entries for the outcome the firm promised to deliver, with any necessary provisos, the promised budget, and the promised timelines. These should also be set out in the retainer agreement, of course.

(d) What was delivered? Separate entries for the actual outcome achieved, the actual amount charged by the firm to achieve it, and (internal access only) the actual time and resources consumed to deliver it. Don’t provide reasons or excuses for any variances in this spreadsheet; they’re immaterial from the perspective of client results.

(e) Was value provided? The client’s assessment of the outcome of the retainer. I suggest using a simple grading system similar to that found in some graduate schools: Fail, Pass, and Honours. Either the outcome failed to provide the value sought by the client, or it provided the expected value, or it provided value that exceeded the client’s expectations. That’s all that really matters.

The firm’s managing partner, the appropriate practice or industry group leader, the appropriate client relationship partner, and the director of client relations would own responsibility for this spreadsheet. They should check it daily and confer about it weekly. Passing grades should be recognized and congratulated; honours grades should be celebrated and rewarded; failing grades should be a red alert that galvanizes the entire team and spurs an immediate meeting with the client and a soul-searching post-mortem by the lawyers and staff involved.

Are you with me on this so far? Okay, there’s one last step in the process, and it’s a really hard one. Circulate these spreadsheets throughout the entire firm. Let everyone see how well each group and each lawyer has delivered on client promises, managed timelines, and met budgets. Identify all the “honours” grades and place them in a firm-wide email, congratulating the lawyers and groups that have collected the most “H”s in the previous month or quarter. Ostensibly, this is to reward your top value performers; additionally, it will light the competitive fires within every group to achieve more “H” ratings than other groups, or more than they’ve achieved in the past.

The point of this exercise, or any similar system you develop with your own firm, is twofold. First, you must track the outcomes you deliver to your clients. If you don’t record and analyze your firm’s performance against expectations, you’ll be unable to improve it and you’ll be blindsided when disgruntled clients finally lose patience and move their work elsewhere.

And secondly, this kind of system provides you with invaluable data that you can use throughout the firm, including for management, training, compensation, bonuses, and other elements of the firm’s operation. Give your firm the data it needs to analyze its own performance and to constantly strive to do better.

This is an excerpt from Law Is A Buyer’s Market: Building a Client-First Law Firm, published March 2017 by Jordan Furlong, a legal market analyst and consultant who forecasts the future development of the legal services environment. For more information or to order a copy, please visit law21.ca/books.

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