A question of value: An in-house perspective

A law firm can sell itself on a range of capabilities: expertise, geographical location, size and technology to name but a few. All might come to nothing, however, if the legal team pitching the prospective client does not know how those resources might meet the particular needs of the client company.

At the most basic level, a firm needs to understand how it is viewed by the market. Some clients (as demonstrated by Richard Wiseman in this month’s industry roundtable) place considerable value on the relationships they have built up with one of the firm’s rainmakers. The firm is in a winning position as long as that partner remains with the firm, but as soon as he or she leaves, the chances are that the client will go with them. The problem becomes even more pronounced when a valued partner reaches retirement age. The law firm risks losing not only a valuable fee earner but all of his or her clients as well.

The solution must be for law firms to think more proactively about their service offerings and the needs of their clients. A firm cannot be blamed for making the most of its talented lawyers, but efforts can be made to share knowledge, improve working processes and build the strengths of younger/less experienced lawyers to ensure that client success stories are not few and far between. Similarly, marketing, combined with HR initiatives, should be embraced to instil in employees a sense of the firm’s identity and, more importantly, its business proposition. Only then can management be sure that the client market is receiving a good, unified message about the firm, its culture and potential service offerings.

Above and beyond all of this, however, is the necessity of gaining an understanding of the client’s needs, what it wants from its incumbent and prospective external law firms, and how the firm can go about meeting those needs, not just through individual expertise, but through delivering legal services that use every resource available to effectively build the client relationship. Having just attended Ark Group’s Strategic Marketing for the Legal Profession conference, the impression I have is that law firms are working hard to brand their businesses and better meet their clients’ needs. Over 60 delegates attended the event, which covered topics from key-client management to internal cross-selling and external-sales techniques. The afternoon sessions of day one would have proved particularly useful for firms trying to differentiate themselves in a competitive landscape. Andrew Hedley of Pinsents and John Renz of CMS Cameron McKenna tackled this difficult area with some aplomb, but we will wait to see whether law firms really succeed in differentiating their business proposition. The indications from in-house counsel featured in this issue suggest that they have some way to go yet.

Caroline Poynton
Editor

Features

Competitive advantage through the legal network: An external lawyer review – one year on Free
In early 2002, Carillion decided to carry out a root-and-branch review of its external lawyer network. Cutting the law-firm panel by more than two-thirds, it targeted significant cost reductions and a marked improvement in service. Consequently, in October 2002, the Carillion legal network was formed. Richard Tapp, Carillion’s company secretary and director of legal services, describes the project and reviews the results one year on.

Performance measures: an in-house perspective Free
The flexibility of the balanced-scorecard approach to performance management has made it a hugely popular theory, implemented across many industry sectors, be as it may with varying success. How far should it now be applied to the legal profession? Gwyn Price, a consultant to American Express and visiting professor at Nottingham Law School, compares performance-measurement strategies at law firms and in-house departments to see how much has been learnt and what needs to be done to make lawyers truly part of “learning organisations”.

Technology matters: no really, it does Free
Charles Christian, editor of the Legal Technology Insider newsletter begins a regular Managing Partner technology column. In this month’s introduction, he explains why technology is so essential in the modern law firm.

What management system Free
The decision to implement the latest technology to improve working processes is a wise move in delivering to clients the best legal services possible. However, confusion reigns in what various systems provide and enable, often making effective implementation impossible. Tim Travers, a consultant at Neil Cameron Consulting Group, attempts to demystify the management-systems landscape.

To be better strangers Free
Management themes such as client, knowledge and risk management, marketing and effective HR, are integrated through cultural ideals of teamwork, collegiality, communication and consensus. All are part of a management lingo that has penetrated the workings of the modern law firm, marking the move of many from a traditional partnership to corporate ideals. However, is this really the best way forward for a professional practice? Christopher Honeyman Brown, chief executive of ASB Law, asks whether law firms know just what they are risking when they embrace the concepts of the business world.

Making pitches less speculative Free
An economic downturn is a far from ideal environment for law firms pitching for work. Consequently, many have focused their strategies on improving existing client relationships rather than attempting to forge new accounts that may not be as profitable. However, for firms that can manage speculative pitching, there could be a real chance of winning competitive advantage. Tony Reiss, a founding principal at Sherwood PSF Consulting, provides some checklists for winning clients in a competitive landscape.

Regulars

Personal profile: Mark Jones, Addleshaw Goddard Free
In a profession that is still new to the world of management, Addleshaw Goddard’s managing partner Mark Jones has been a singular example of managerial drive in the firm’s past decade of growth. It has been an exciting if demanding period in which he has had to make many difficult decisions, including rationalisation. So what is the story behind this old-timer of the legal management world? Caroline Poynton finds out.

Industry roundtable: A question of value Free
The current view is that lawyers, by nature, are not good at selling either themselves or their businesses. So how do in-house counsel and external lawyers fare in communicating to each other the services needed and available for a profitable working relationship? Caroline Poynton talks to in-house counsel at Barclays, BT and Shell, and a former in-house lawyer at United Assurance Group and Cheltenham & Gloucester, about their experiences of managing their external law firms.