The future of law firm sales?

17 04 2011

Inspired by a recent dialogue on Twitter between Mike Ames (@Mike_Ames_Flair) and I (@intchallenge), I was struck by the similarity of some of our messages to law firms on the thorny subject of sales (talking about “client development” is much easier…). After posting some linked blog posts, we decided it was time to experiment with a social media-sales-mash-up.

James was not sure the practical sales training for lawyers was wholly relevant, but was willing to give it a try

Mike recently blogged about why lawyer’s don’t like the “S-word”, and I thought I’d add some of my thoughts to what I thought was a great post. It’s an interesting perspective, because while I’ve sold legal services, bought legal services and sold to law firms, I’m not an out and out sales person. Mike on the other hand has worked in business development for over 20 years, and has a history of both his own business development and coaching others to sell.

So, let’s mash (Italicised text is Mikes)!

Let me start by saying not all lawyers hate doing the “S” word. There are quite a few that I know who would prefer to do nothing but sales especially if meant getting away from all that tiresome law stuff and those impossibly demanding client-typesBut, whilst business development is an acceptable alternative phrase for sales (but not real work apparently) actually getting down to doing it is not top of the to-do list for most lawyers, but why?

Based upon my own coffee-house investigations (OK some of them weren’t carried out in coffee houses) these are my top 5:

  1. It takes too long – I just don’t have the time to fit it in. This is true, and the underlying cause is of course the tyranny of the chargeable hour. Maister talked years ago about the chargeable hour being today’s profit and the non-chargeable hour being tomorrow’s profit and nowhere is this truer than in the context of business development. How many other businesses would fail to recognise the importance of bringing work in to such a degree?
  2. It’s not my job – that’s what marketing are employed to do isn’t it? Sadly, the distinction between functions such as marketing communications, marketing strategy, pitch support and pure sales is often blurred in law firms, and thus the easy to understand link between sales and revenue often gets confused with other marketing-related activities that have much more difficult to calculate return on investment metrics.
  3. The law is more interesting – it’s what I was trained for and it’s what I want to do. This seems to me to be an entirely valid statement if you are working in a firm that can accommodate this approach. If not, then there may be a problem!
  4. I’m not sure what to do – I’ve had no real training or guidance. Definitely true at smaller and mid-sized firms. At the larger firms, I’d add a qualifier – the lawyers may well have had some training, but haven’t had the opportunity or encouragement to actually practice their skills and hone them. It might seem obvious, but selling is a skill – I remember first being taught Strategic Selling and SPIN selling as a circa 2 year qualified lawyer, but it wasn’t until I’d practiced them many times, often with an experienced business development professional at my side, that I began to internalise them and crucially, feel more comfortable using them.
  5. It’s just a bit grubby – I’m a professional not a used-car salesman. In my experience, while this attitude does exist, it’s dying out.

I’m not sure how close this to your own beliefs but they did crop up fairly consistently. By way of a response I would say: –

  • It is your job and is going to grow in importance. Accept it and move on. 
  • Sales is what makes the world go around – nothing happens until somebody sells something. If it helps consider yourself to be more of a facilitator. This is particularly true at the moment – you’ve cut costs, but revenues remain sluggish. Firms need revenue to grow. Of course it’s servicing the work that generates the revenue (and yes I know, managing WIP and aged debt are important too), but if you don’t sell effectively, the firm is unlikely to grow significantly – incremental growth of existing accounts in the current climate is unlikely to do the trick.
  • Like most things you can do it in a highly professional or decidedly sleazy way. You choose. This might seem like a no-brainer, but I’d go a step-further. If you are a lawyer with good client skills, the chances are you can be an excellent sales person. Professional, bright and good at asking questions, these are core selling competencies. Put some structure around them, season with a little theory, and then finish with a liberal serving of practice, and you’ve got yourself a rainmaker!
  • Once you have been trained it is easy and does not really take a lot of time. The sales cycle may vary depending on what you are selling, but importantly it will become a process that you can help shape, rather than just being on a treadmill of responding to client RFPs (requests for proposals).
  • It can actually be great fun, satisfying and very financially rewarding. Hell yeah. Closing a big piece of business can give a buzz that’s just as good as getting a deal signed, and you’re unlikely to have worked 48 hours straight to get it done!

I’m not a lawyer but I believe in the future the lawyers who get on most won’t necessarily be great at the law but they will be great at sales.

This I’d also agree with, but I’d also add some gloss. I think as more and more firms re-examine their business model, this will highlight the importance of the sales function. This may manifest as lawyers getting better at selling (more professional training, perhaps truly looking for sales skills and experience when recruiting), it may also result in the development of sales departments in law firms? Sounds a long way off? I’m not so sure. I’ve worked with firms who have business development managers who are very good sales people, and often accompany partners when they go out selling. This is a great model and it works very well. Where it falls short is of course scale, and for a large law firm (which is likely international), to have two or three really skilled sales people seems like an unnecessary restriction on revenue growth.

Now of course there are arguments that with professional services, clients are buying certain individuals, and to some degree I accept that. But even now there are challenges that can be made to that concept – when a partner pitches for work, will the client really be getting much of the partner’s time? The more efficient firms push work down to the minimum qualification level possible that will meet quality standards, and that will rarely be the partner. This of course helps keeps costs down, which translates into lower fees or higher profit margins, depending on the pricing structure.

In the IT industry, the concept of a pre-sales expert is common. This is someone with real technical knowledge who accompanies the sales force on prospect meetings to answer technical questions and demonstrate the company’s expertise. This model may need a bit of adapting for the legal profession, but I absolutely believe that the firms that invest in a highly skilled sales force, whether it’s lawyers, sales professionals or a mixture of the two, can really grow market share and win some serious business.

In that scenario, the losers? As Mike says, they’ll be those that turn their nose up at the S-word!

Mike’s website is here if you want to learn more about his approach to sales.





The Specialist Generalist

7 02 2011

Participating in a panel event for in-house lawyers last week, I was struck by the versatility of the corporate counsel that were taking part.

 

Keen to demonstrate the depth of her specialism, Lisa the construction partner parked her new car carefully at the front of the firm car park

 

In-house lawyers are so much more accessible to their clients than lawyers in law firms, and this, coupled with the incredible range of business (and personal!) questions that can come across their desk in a day’s work, really does highlight the ability to answer a broad range of questions.  While larger in-house legal teams of course have specialists (employment law, M&A etc.) I suspect that even these lawyers  get called on to advise outside their niche more often than their private practice counterparts.

So the question that sprung to mind, was if many corporate counsel need generalist skills, what does this mean for their relationships with their advisors, particularly given most large law firms start lawyer specialisation so early in their careers?

Building on my observation that the variety and accessibility of in-house positions, and taking into account that many in-house lawyers have built up a degree of experience before they move into an organisation, it’s likely that generalist skills can be found in abundance in the legal team. Is it therefore the case that when corporate counsel instruct external lawyers, they are doing so because they need specialist advice? Given the pace of change and breadth of the law these days, particularly if the business is operating internationally, at first glance this would seem sensible, because no lawyer (however good) could hope to keep up-to-date across the board.

My instinct however is that there are no hard and fast rules here, as the client’s needs will  vary on the situation. Some clients will need specialist advice because they don’t have the skills in-house (or perhaps they do, but they don’t have the bandwidth to deal with the particular matter). Others may want a generalist “replica” of an in-house lawyer who can simply add capacity to the in-house team and interface directly with the business people. Some may just pick up the phone and “phone a friend”, and care less about who actually does the resulting work.

The choice of external counsel is however heightened on high-stakes matters. Does the client choose a top-drawer “name” specialist, ranked in directories from here to Timbuktu, or do they go for a more seasoned “trusted advisor” type who may require specialist support from elsewhere around the firm, but can provide much wider support around things like  stakeholder management and communication?

Personally, I believe both types of lawyer can add tremendous value and have their place. I do wonder though, to what extent the “trusted advisor” role will change as the next generation of senior lawyers are those who have spent their entire careers advising on fairly narrow areas of law.

One final observation I have is that there are relatively few true industry specialists. In reality, a specialist technology sector lawyer is really a specialist IT lawyer; a specialist entertainment lawyer maybe a licensing expert. Perhaps this is the way that the “trusted advisor” role could develop. Lawyers who have deep industry experience, acting for many different clients (perhaps at different stages of an industry value chain) in the sector, with this knowledge meaning that they advise on many different areas of law in addition to their core specialism.

So, why not take a look at who else your clients instruct? Are you the only firm or team in the game, or is there a panel (formal or informal)? Who, if anyone, gets the generalist work? Is specialisation getting you the instructions and clients you want? Can you do a gap analysis to show the skills & experience that you have compared to the profile you would like to develop?

And finally, what would you do if you were in-house and the C.E.O. walked into your office needing immediate advice on how he could save his dog, Beefcake, from the legal consequences of taking a bite out of the postman…..





How hard is your work, really?

1 04 2010

Outside the profession, despite the bad press that lawyers get, the majority of people still think of the practice of law as an intellectually challenging job. Fundamentally, I think they are right. It takes time to learn the black letter law that underpins the work, and more time still to understand how to apply it to the wide variety of circumstances that a lawyer will come across in day to day practice. To then present that advice in a format appropriate to the client, to use creativity to solve problems, and to build the relationships and trust necessary to build a long career is tough.

A brain surgeon: is he smarter than you?

But (you were expecting a “but”, right?), within this work profile there is of course a spectrum of complexity. Traditionally, as lawyers became more experienced, they took on more complex work and more junior lawyers stepped onto the first rung of the ladder to begin their career learning to do the less complex work. But somewhere in the middle, things get a little hazy. In the old favourite “Managing the Professional Service Firm”, Maister talked about the classic challenge of under-delegation, and my suggestion for today is to revisit this in your working lives.

When times get tough, as they have certainly been recently, the classic law firm model of having chargeable hours as the main metric for judging performance encourages lawyers to hoard work to keep their figures healthy. Whether that work is done at the right level (or indeed even profitable) is often a question that is not asked.  As firms are restructured to realign the cost base with the reduced revenues that come with a recession, mid and lower level resource is stripped out. This recession was arguably different from the previous two in that more partners found themselves on the move, but irrespective of this, my point is that as the work volume starts to increase, many firms will find they don’t have the right profile of  resources to do the work efficiently.

Have a look at how you are spending your day. Not in a “timesheet-track-every-six-minutes” kind of way, but in a more substantive “where am I spending my time, and who else could do this work” kind of way. Could work be passed down to junior colleagues? Could it be a valuable training exercise? What about automation or outsourcing? If your time was freed-up, how else could you create value for the firm or legal department?

Enjoy your day today, and particularly appreciate the difficult parts that challenge and stretch you!