More Law Firms Earning Client Recommendations

Top legal decision makers recommend 293 law firms, 21.6% more law firms for 2019. This upswing is on the heels of a 3-year downtrend. We see 2 driving reasons:

1) A number of law firms are having success with their firmwide client service excellence initiatives—bringing new unprompted recommendations from clients.

2) Clients are using more law firms than last year—and a number of these firms are picking up new recommendations in the early stages of the relationship.

We are talking about GC-to-GC recommendations—the kind taking place in private and frequent conversations – when top legal decision makers share their experiences with different law firms. These unprompted peer-to-peer recommendations are the most powerful—and lead to serious new business.

Please join me in congratulating the firms with the best branding through unprompted client-to-client recommendations:

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5 Reasons Clients Love to Call Their Law Firms

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Clients tell us there are 5 times when they truly enjoy calling their outside counsel. These busy legal decision makers have little time for optional phone calls—which makes these 5 especially telling. These calls are:

  1. Review a delivered work product
    Clients inevitably have questions, comments, and changes. Your clients view these calls as essential and productive. Many enjoy intellectual stimulation. These calls are a core part of the work process.

  2. New work
    Congratulations. Your client wants to give you more work. You have superior client service, you deliver on time, and within budget. You understand your client. You won the work without going to RFP. Clients like to make these calls and partners like to receive these. An excellent phone call by any standard.  

  3. Come give us a CLE
    Clients may need to meet a state requirement, improve staff morale and productivity, or see a knowledge gap in their department. They want you to train their staff. A CLE provides more than knowledge. CLEs provide new thinking, promote internal dialogue, make outside counsel seem more available, and show the top legal decision makers actively investing in their people. All good.

  4. Give you feedback
    Contrary to popular belief, clients like to give you feedback. They want you to be better at what you do, no matter how good you already are. Everyone can improve. The clients who take the time to share feedback on your performance are among the best clients. These clients are invested in your success. Another good phone call—especially weighted towards the law firms.  

  5. Checking in
    Clients call their favorite partners to see how they are doing. Clients want to stay in touch and see their advisors succeed. While a good call by any measure—it is also a sign—you are not staying in touch with your client. The best clients and law firm partners know informal communications drive the success of all the other communications.

If you are getting these calls, accept our congratulations—and keep developing what is clearly a strong relationship. If you’re not—here are a few suggestions:

  • Call your client. Share progress and tidbits from your current work. Talk about the good work your associates are doing. List out any new thinking or breakthroughs—even an interesting observation. The important message—bring your client into the process early and often.

  • Update your client on firm events. Any client who treats you as a primary law firm wants to know the firm’s plans. They enjoy knowing their advisors are planning ahead and feel included when you make an effort to tell them. (They feel excluded when they learn about your firm’s strategy from a 3rd party—including the press.)

  • Call and offer your client a CLE. So few clients are proactively offered CLEs you can almost count them on one hand. Law firms who offer up a CLE before clients ask, stand out as the proactive, understanding firm. The law firms who wait for clients to ask are merely responsive.

  • Ask for feedback. Clients want to tell you how you are doing and want you to improve. Ask before clients offer and position yourself as one of the firms who includes self-improvement—and client thinking—in their culture.

  • Stay in touch. When one of the calls clients love to make is to see how you’re doing—they are saying they want to do business with the person and the firm. Make it easy—schedule a time every 2 to 3 weeks to have a short call with your top clients. Share the more interesting parts of your life and ask your client about theirs.

    One top legal officer at mega-sized Tech company once remarked how the most surprising thing the partner from his most used law firms ever did was to call and ask how things were going and what was new in his world. It changed the whole relationship for the better.

You can’t exactly hire yourself for new work—but the law firm partners who take the time to make these calls will receive one of the call clients love to make—give you new business.

MBR

Clients Shatter 2 Records Helping Latham Shatter $3 Billion in Revenue

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Clients are on pace in 2018 to record levels for spending the largest amount ever on outside counsel. At the same time, they rely on fewer law firms than ever.

Latham, which has just posted the highest revenue of any law firm, has been following and using these shifting client and market trends to its advantage for more than 10 years—it’s one reason Latham’s growth is in overdrive. 

Latham’s unprecedented growth is turbocharged by the firm understanding why clients are consolidating their work and then positioning the firm to pick up major chunks of new business with existing clients by delivering what clients are seeking.

Latham’s winning approach? Adopt the ‘provide-the-best-value’ approach, not the low-cost provider approach—and clearly this tactic is working.

This strategy becomes clear once you understand why clients are consolidating work.  

Improving Risk Management

The current round of consolidation is all about risk management and adding value. Clients have been cutting their law firms in an especially aggressive manner—dropping more than 19% of their firms over the last 3 years. On average, clients now have a record low 34 law firms on their panel, down from 42 firms in 2015. Clients’ goals with consolidation are to:

  • Streamline outside counsel management
  • Stop working with firms not adding measurable value
  • Have law firms build institutional knowledge about the company
  • Develop uniform understanding of their preferences among their law firms
  • Create uniform understanding around the risks they face

It’s Not About the Fees

Cutting your fees won’t keep you on the roster anymore. What clients are looking for most in their panel firms is: 

  • Knowledge about their specific risks and exposures
  • Vehicles to share and discuss this knowledge
  • Candor—how can they do things better and smarter
  • Tools—budget/progress dashboards and other tools where key information is now on-demand
  • Education on issues they need to know—going well beyond e-alerts

These criteria have big implications for how to develop big client relationships: 

  • Clients teams who don’t offer client-specific education programs will miss a major opportunity to upgrade the relationship. 
  • Play an active role in helping clients streamline their legal operations. 
  • Use client feedback to learn what tools clients have, what they want, and then give them more. 
  • Always be in an informal discussion with your client. Informal discussion provides the context for the formal requests— giving you knowledge no one else has, and you will learn about new needs before anyone else, too.
  • Offer to perform the work you know is coming down the pike—don’t wait for it.
  • Stick it out. Client growth is anything but linear. It will take more time to develop than you expect—and will then grow faster than you expect.

Clients have never been more serious about using their law firms in a more clever way. The market is still ripe for firms to execute this low-risk/high-return strategy, but success demands commitment, training, tools, and embracing the art and science of pulling all the pieces together to make it sing. Latham serves as highly visible proof of this concept. What more evidence do you need? 

BTI has helped some of the most successful firms in the world develop client growth plans. We would be happy to answer questions or discuss your approach.      

MBR/JPD

(Based on BTI research conducted on a rolling basis between February 2017 and December 2017. BTI conducted more than 350 independent, individual interviews with CLOs and General Counsel at Fortune 1000 companies and large organizations)

How Clients Hire: Top Clients Impose Law Firm Hiring Moratorium

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A group of forward-looking top legal decision makers have stopped hiring new law firms.

“I am tired of spending my time listening to the same old story. They all say the same things. There is no point. It isn’t like I don’t know what I am going to get. I’ll work with the firms I have,” explains an SVP of a large financial services company. If your firm hasn’t done any work for these clients in the recent past, you don’t exist.

While representing no more than 15% of clients—they control more than 30% of US legal spending.* Their plan: Drive the law firms with whom they want to work into better performance. These clients plan to:

  • Initiate discussions about legal strategy for key matters

  • Ask for options before getting too deep into a matter

  • Convince law firms to adopt tools to get things done with budget predictability

  • Keep their law firms advised of their plans to help them be prepared for what’s coming

  • Give feedback—regularly. Clients plan to point out inconsistencies in service and delivery and tell you exactly where and how to improve—mostly in process and communication

Your client is unlikely to announce this new change. And, they will only engage with a few of their firms. Clients don’t have the time or energy to drive change at all their law firms. Only a few firms will emerge stronger and larger as the decision makers gravitate to the top performers and those who embrace their changes.

You can pick up on the clues quickly through well designed client feedback. The non-feedback firms will have to pay close attention to every client request and communication to be able to try to figure out what clients want.

The only safe bet to be one of the chosen few is to behave as though your large client is going to develop a better and bigger relationship with you—and YOU initiate the feedback process. We recommend starting with fresh and broad feedback from everyone with whom you work at your large clients. This means many interviews at a single large client (our record at BTI is 39 individuals at a single client, so far).

Analyze the feedback and share the results with attorneys serving your client. Then—be daring—share the major findings with your clients along with suggestions for how you plan to improve. Ask your clients for their suggestions. Then—change.

If you need help developing the questions, tools to analyze the insight, or recommendations, please feel free to reach me at mrynowecer@bticonsulting.com.

At the same time, treat any requests to attend client meetings about operations, upcoming plans, and almost any other topic as a juicy invitation to be briefed on how to get more business.

MBR

PS. Don't miss out on our upcoming Market Outlook and Client Service Review webinar on January 18 at Noon Eastern. You can learn more or register here.

*Based on BTI research conducted on a rolling basis between February 2017 and December 2017. BTI conducted more than 350 independent, individual interviews with CLOs and General Counsel at Fortune 1000 companies and large organizations.

3 Techniques to Build Stronger Client Relationships--Part 2: Setting Client Expectations

Setting client expectations is all about eliminating surprises for your client. BTI Principal Jennifer Dezso shares 11 prompts for attorneys to use to help set client expectations, AND describe the value they provide, showcase their experience, and keep everyone moving toward meeting the same objectives.

You can view the video by clicking the image below, or on YouTube directly here: https://youtu.be/vCXmeUWi2z0

View Part 1 Here

With this series we’ll be taking an in-depth look at a wide range of client relationship best practices. We’ll be releasing Client Relationship Lab webisodes on our blog every month—subscribe today (in the box at the upper right of your screen) and be sure you don't miss a single one.

The Value Equation Cheat Sheet: Delivering Superior Value

Delivering superior value to your clients isn't only about doing more than what's expected of you. With this Value Equation Cheat Sheet, Jennifer Dezso shows you how to talk about value with clients so their decision to hire you isn’t solely based on price.

You can view the video below, or on YouTube directly here: https://youtu.be/D_Ccko9C2wA

We’ll be releasing videos here on The Mad Clientist blog every Tuesday. Subscribe today (in the box at the upper right of your screen) and be sure you don't miss a single one.

4 Keys to Winning More Work

Acting as a business advisor sparks conversations and develops relationships before legal issues arise and leads to capturing high-rate legal work from your clients.

Your ability to provide your service in the context of the client’s business will most differentiate you in the eyes of clients. Industry dynamics, current events, emerging regulations, competitor news, and the political landscape are the basis for providing targeted advice to help clients meet their ultimate objectives. Learn more about providing this crucial service to your client’s in my best-selling book, Clientelligence: How Superior Client Relationships Fuel Growth and Profit, available now at www.bticonsulting.com/clientelligence.

MBR

 

Change Your Client Relationships with New Matter Triage

Clients are seeing more new, complex matters than they have in the last 5 years. Learn how firms are using new matter triage to earn this new, complex work and change their client relationships.

You can view the video below, or on YouTube directly here: https://youtu.be/YEb6hfGVxNU

We’ll be releasing videos here on The Mad Clientist blog every Tuesday. Subscribe today (in the box at the upper right of your screen) and be sure you don't miss a single one.

What Attorneys Think and What Clients Hear: A Client Communication How To

Communication: one of the biggest gripes clients have with law firms. In this month's Client Relationship Lab we'll take an in-depth look at how to communicate effectively so clients aren't left to their own imagination about what their attorneys are doing for them.

These 3 building blocks of successful client communication will help you take the first steps away from being a generic legal provider and toward becoming a trusted partner.

You can view the video below, or on YouTube directly here: https://youtu.be/rrxDmvyKzMU

We’ll be releasing these in-depth webisodes every month—subscribe today in the upper right hand corner—and make sure you don’t miss a single one.

Resolutions Rot on the Vine—Do This Instead

AlexeyVis/iSTockPhoto.com

AlexeyVis/iSTockPhoto.com

Just after Christmas, knights of medieval times would gather together and, one by one, take an oath. Each knight would place their hand on a live (or sometimes roasted) peacock and recommit themselves to the ideals of chivalry for the next 12 months. The peacock was placed in an ornate, specially crafted gold container and was chosen because its plumage was considered the most beautiful and powerful gift the Royals could offer, alongside crowns and jewels. Some knights would be given ceremonial helmets adorned with plumage.

The ceremony became known as The Vow of the Peacock.

Knights would recommit year after year—they viewed this as stronger than a resolution. The knights were making a public pledge to others and could not break it, as this would be unworthy. The public recommitment helped keep chivalry alive in the kingdom.

The knights viewed a resolution as more of an inward promise—something others may not know about or understand. Better to outwardly commit, continue to drive chivalry, and be proud as a peacock.

Instead of making inward resolutions, we recommend each firm’s executive committee perform their own version of The Vow of the Peacock ceremony—and then ask the partners in each practice group to do the same. As a firm, you will be recommitting to the ideals of chivalry toward clients.

The noblest firms in the legal kingdom will perform The Vow of the Peacock in front of their clients. This means sharing your client service commitments in an outward manner. It can take the form of firmwide client service standards; making individual commitments to each of your major clients around how and when you will communicate progress; learning about their business; providing formal updates; or informing clients of changes.

Use The Vow of the Peacock to recommit yourselves and your partners to clients, as well as to superior client service. And you, too, will be proud as a peacock.

Wishing you a happy, healthy, and prosperous 2017.

MBR

Where to Invest More to Build Superior Client Relationships

This week’s Mad Clientist Minute features The Mad Clientist himself discussing exactly how law firms with the most successful client relationships allocate their marketing and business development budgets.

You can view the video below or on YouTube directly, here: https://youtu.be/ncJRWnXMgoo

We’ll be releasing videos here on The Mad Clientist blog every Tuesday. Subscribe today (in the box at the upper right of your screen) and be sure you don't miss a single one.

The Law Firms with the Best Client Relationships

Behind every great rainmaker, mover and shaker and leader are great relationships. In fact, replace great with superior. People who make things happen make superior relationships first.

People who sell don’t develop nearly as much business as people who develop relationships. New business flows to those individuals and companies who can move beyond a transaction to a relationship. People, especially executives, don’t want to work with the person with the best sales skills. People want to work with those who are emotionally invested in helping them and will pay significant premiums for this rare commodity.

Client Investment Drives Success

Let’s start with our end goal: grow better—and more profitable—client relationships. (If your goals don’t involve growth and/or profitability, you can stop reading here. Good luck on your business venture.)

In order to achieve this goal, we need more clients giving us more money. Put another way, we need clients who are invested in us. Invested clients spend the biggest portion of their hard-earned money with you. Invested clients will also willingly recommend you to their peers without you ever asking for a reference.

Satisfied clients are not necessarily invested clients. How can you tell the difference between a satisfied client and an invested client? Easy—their behavior.

Truly invested clients—the clients with whom you have the absolute best relationships—exhibit 2 key behaviors (which also happen to be measurable and objective assessments):

  1. Out of all the providers a client uses for a particular service, they spend the most money with you—usually 2 to 5 times more than anyone else
  2. You are the first provider a client recommends—in an unprompted manner—to their peers

When both of these statements ring true with a single client, you have reached the ideal state of the client relationship…you are in Clientopia®. This is the strongest relationship you can possibly have. Clientopia relationships trump satisfied clients—invested clients have a stake in your success—satisfied clients don’t.

Think of a Clientopia relationship as having 3 key components:

Component 1: Earning the Client’s Financial Investment

A typical company relies on 42 law firms for their legal needs. However, on average only 2 firms are considered primary.

Does being primary matter? Only if you are looking to make money and grow.

A single primary provider typically captures 25% to 40% of a client’s budget; letting the other 41 providers fight it out for the rest.

When you are a primary provider—and in particular the first primary provider a client turns to—clients are making a financial investment in your organization. You have the best access to clients and their premium work.

Component 2: Earning the Client’s Emotional Investment

Recommendations are one of the leading indicators of future growth potential for a service provider. Fully 57% of C-level executives will hire a new service provider based on a single, unprompted recommendation from a peer. A staggering insight into the power of recommendations—correction: unprompted recommendations.

Unprompted, unaided recommendations mean you earned this recommendation on your own merit. No one asked about you by name or included you as part of a list.

It’s the difference between:

“How did you like eating at Restaurant ABC?” (Prompted)

And:

“What’s your favorite restaurant?” (Unprompted)

When you are the first service provider a client recommends—unprompted—you have earned the client’s emotional investment. They are willing to stick their neck out for you; giving you access to new work opportunities.

Component 3: Make Lots of Money for a Long Time (Reaching Clientopia)

The key to Clientopia’s kingdom demands you bring both of these components together to achieve the ideal relationship. In Clientopia, you have earned your client’s financial and emotional investment.

Being in a state of Clientopia provides a number of significant advantages (more on those in a later post), but let’s get the financials out of the way. Providers with best-in-class levels of Clientopia enjoy:

  • 19.5% rate premiums
  • 35.6% faster revenue growth
  • 33.1% higher client retention

The good and the bad news: only 40.1% of clients see themselves in a state of Clientopia. And these 40.1% of clients are in Clientopia with only 20.6% of the law firms serving large clients. This is disproportionately as important to every law firm as profits. The law firms in Clientopia will gain share organically as other law firms let their relationships slip away.

BTI will release the client rankings of law firm relationships next week in our brand new BTI Power Rankings 2016: The Law Firms with the Best Client Relationships. The report ranks law firms on the strength of their client relationships—both overall and for 16 industries. Subscribe now to ensure you don’t miss a beat and stay tuned for the rankings—including the 24 law firms with the absolute best client relationships.

MBR