A Survival Guide for Legal Practice Managers

A Survival Guide for Legal Practice Managers

How to start a sales program in your law firm

Tuesday, August 19, 2014

Your 4 step guide for turning lawyers into lead generators

by Sue-Ella Prodonovich, Principal, Prodonovich Advisory

For law firms, a successful sales campaign involves much more than simply cold calling. It requires strategy, planning and - most importantly of all - commitment across the whole firm, from the managing partner through to individual lawyers and support staff. And from every management function, including finance and HR. 
This is my guide for how to build a successful 90 day sales program for law firms. 

But don’t be misled by the name. A 90 day sales program doesn’t involve 90 days of selling. It involves 90 days of groundwork. After all, I find most firms need at least that much time to get from where they are to the point where they’re ready to make a real impact.

Step 1. Roadmap

(More than 90 days before sales campaign)

The first step to any successful sales plan is to agree on what your firm wants to achieve. Of course, the end goal of any sales campaign is to generate sales. But how exactly will you do this?

For instance, do you intend to identify new leads from existing relationships? To re-engage with networks in your community? Or to win new business from new clients? Most likely, you’ll be aiming for a combination of all three.

Once you’ve established this, prepare a roadmap for achieving it and figure out how you will report progress. 

In particular, you should:
  • Work out how long your campaign will last (usually from 3 – 6 months) 
  • Agree key performance indicators and important milestones
  • Work out what you will do in the preparation phase, the activity phase, and also the debrief. 
  • Agree on a budget
  • Identify and remove any red tape or barriers that may be getting in the way of lawyers networking or meeting clients.
So that your staff are engaged and committed,  make your sales campaign fun and something different from the day-to-day. For starters, give it a name. 

Lawyers are almost always competitive types, so consider introducing friendly competition between teams and include as many staff as possible. Why not start a ‘BD Olympics’ or a ‘Sales Apprentice’ competition?

Step 2. Research

(More than 60 days before the sales campaign)

You’ve already gone through the top level strategy. Now it’s time to put meat on the bone. It’s time to start your market research.
  • Work out what your firm’s and lawyers’ strengths are and also where the best opportunities lie.
  • Prepare a list of compelling propositions about why clients should go with you. (Identify clients’ pain points and show how you solve them.)
  • Establish a sales pipeline for your office or your teams. You can do this by building a target lists of clients and referral sources and then providing your lawyers with this valuable market intelligence.  
  • Develop a consistent approach for how you will go about trying to attract more work from them.  Better still, go one step further and give your lawyers real confidence in their ability to convert these prospects into clients through skills training. 

Step 3. Rally

(More than 30 days before the sales campaign)

It’s almost time to go in. But before you do, make sure everything is in place and that you’re geared up for success. 

For starters, make sure your marketing collateral is up to date and reflects the key message you want clients to take away - this includes your website, LinkedIn profiles, capability statements and pitch templates.  

Arm all lawyers and their support teams with at least 20 examples of BD activity. Give each of them at least 3 referral sources and at least 2 existing clients to research and target. 

You should also give your lawyers something tangible they can invite clients to. The best way to do this is to schedule a client-networking event around 120 days after the start of your campaign.

Finally now is the time to carry out a brief client feedback survey, using at least 25 contacts from both your clients and your referral sources.

Do more with your numbers:  Provide data that adds insight into changes in your fee base and uncovers opportunities for lawyers.

Step 4. Ready! 

The campaign begins.

The big day has arrived.

By now the feedback from clients and referral sources will be available.  And some of what they've told you, you probably don’t like or didn't know. So use the first 30 days of the sales period to focus on closing the loop on this feedback.

Spend the second 30 days emphasising meeting new contacts and engaging with networks. 

And spend the third 30 days focusing on introducing contacts to others in your firm or in your networks.

You should also schedule a special meeting 90 days after the start of activity to debrief on the progress you’ve made and the impact on the firm.

But don’t stop there. Keep the momentum going by publicly recognising all sales activity and wins on a regular basis. You can do this through a monthly team gathering, preferably led by your Managing Partner. Use this meeting to share stories about successes to and knock backs and recognise outstanding efforts. 

And remember, no one gets everything right first time. The more you keep refining what you do, the more likely you are to build a successful sales machine. 

Editor's Note:

Prodonovich Advisory is sponsoring the pre-Summit Masterclass Workshop 'Mastering Client Development (aka the Sales Process) for Law Firms', presented by US business development guru, Julie Savarino, on Wednesday 28 August.  It is not too late to register for the upcoming ALPMA Summit on 28-29 August at the Melbourne Crown Convention Centre.  If you can't attend in person, find out how you can attend on-line!

About Our Guest Blogger

Sue Ella Prodonovich
Sue-Ella Prodonovich, Principal of Prodonovich Advisory, has more than 20 years experience helping firms assess their business, gather market intelligence, develop competitive strategies, conduct client listening programs and accelerate rainmaking through coaching and sales programs.  In 2013, one of Sue-Ella's clients won the ALPMA NSW Innovation Award for a sales program that delivered a profit increase of more than 25%.

Sue-Ella's career had included senior Business Development roles with Arthur Andersen and Baker & McKenzie, Senior Consultant with Rogen SI, Owner of PTB Consulting, and Partner with Crowe Horwath.  

 Read more about the 25 BD activities all lawyers should be doing.

How Law Firm Managers Should Use LinkedIn To Find Jobs

Tuesday, July 22, 2014

by Irene McConnell, Director, Arielle

I speak to a lot of managers and professionals who think that LinkedIn is a waste of their time.

I’ve been on LinkedIn for a while, but I haven’t found it very helpful” is common feedback.

If that’s you, I completely understand.  Most advice you read online tells you that you just need to “be on LinkedIn”. So, you log in. You might read and post some content. You join a few groups, because LinkedIn says it “improves your visibility”. 

Your endlessly compare yourself by stalking profiles of other users. At best, you endlessly make tweaks to your profile until you feel like you’re winning the “Best-Looking LinkedIn Profile at My Firm” award. At worst, LinkedIn becomes your guilt-free form of procrastination. 

In the meantime, your odds of securing a great job by using the platform remain the same. 

Why Do You Need To Be On LinkedIn?

Let me share with you what’s happening in the world of recruitment and job search.

In a recent talk, LinkedIn CEO Jeff Weiner made it quite clear that jobseekers on LinkedIn already enjoy an almost unfair advantage over candidates who stick only to job boards. 

I think that this is just the beginning. In the next 5 years we'll see it completely upend up our flawed recruitment industry, presenting well-connected LinkedIn users with a flood of job opportunities. 

Most of those opportunities will be in senior, prestigious and rare roles. Have you ever wanted to be in the running for management jobs which never get advertised? Watch Weiner’s talk and see my detailed take on why you can’t afford not to use LinkedIn to its full potential in 2014.

Now, before you head off to look for career opportunities on LinkedIn, I want to make sure that you avoid the most common trap.

The “Spray & Pray” Approach Doesn't Work

Plenty of management jobs are advertised on LinkedIn today, but if you spend the afternoon pushing “Apply Now” button on as many listings as possible, is likely to be a waste of your time.

The biggest mistake job seekers make on LinkedIn is this - they forget that it’s, first and foremost, a networking tool. LinkedIn is old-fashioned networking, supercharged by technology. 

You can significantly increase your chances of getting hired if you already have a pre-existing 1st degree LinkedIn connection with a decision-maker at a company you want to work for.

The good news is - if you’re a manager at a law firm, you’re probably not a stranger to networking. You simply have to expand your networking skills into the online world.  I suggest you set aside some time - about 1 hour each week - to build your LinkedIn network with the aim of achieving that goal. That way, when a firm you want to work at posts a job ad, you’ll be already positioned as “someone they know”.

In many cases, however, you won’t have to wait for a position to be advertised - you’ll know about the opportunities long before they get are made public. 

9 Steps To Get Results

I suggest you develop a LinkedIn networking workflow which is based around the following steps:
  1. Make a list of 5 firms you want to work for. Follow their LinkedIn pages and Twitter accounts.

  2. Begin to build up a picture of the strategic challenges the firms are facing, their goals and achievements. Start to piece together ways you can add value to their business.

  3. Use LinkedIn to identify the decision-makers at those companies. Partners, C-level executives, HR managers, perhaps senior counsel - your ultimate goal is to have 1st degree LinkedIn connections with them. When the timing is right, a message to them will help you stand out. Don’t contact them just yet.

  4. Identify employees in similar roles to yours in those firms who are active in LinkedIn Groups. Engage them in conversation. If you find common ground, follow them up with a connection request. See What To Write In Your LinkedIn Connection Requests.

  5. Find employees who publish a professional blog or who write guest blogs for industry publications. Engage them in discussion on their blogs and, if you click, follow up with a connection request on LinkedIn.

  6. Add to the conversation on your target companies’ social media accounts. If you have a great chat with someone, follow up with a connection request on Linkedin.

  7. Publish 2-4 original articles to your LinkedIn profile which discuss issues related to managing a law firm and provide your take on overcoming those issues. Post those articles in relevant groups and participate in the discussion. You guessed it - follow up your chats with a connection request.

  8. Try to take the conversation offline. Invite a few of your new connections for a one-on-one 15-minute coffee catch-up to find out about the company culture.

  9. Find out if the company is hosting an event you can attend. Meet employees who work there, be honest about your ambitions to work there. Follow up people you meet with a connection request.
By now you should have a number of 1st degree connections with employees at your level and a significant number of 2nd and 3rd degree connections with decision-makers at those companies. Ask your 1st degree connections for introductions to the decision-makers. For detailed guide on how to make powerful introduction requests, see How To Contact Employers & Recruiters on LinkedIn.

Follow up, but don’t be a pest

If you take away anything from this post, I’d be very happy if it was this - LinkedIn is not Facebook.

It rewards job seekers who are very clear about their objectives and use the platform with a networking mindset - that is, strategically and patiently.

About our Guest Blogger

Irene McConnell
Irene McConnell (nee Kotov) is the founder of Arielle Careers, a personal branding agency which specialises in LinkedIn profile optimisation, resume writing and online presence creation. 

You can connect with her via Google +.

Seven Deadly Sins of Tendering

Tuesday, June 17, 2014

By Jacqueline Burns, Managing Director, Market Expertise 



Last year, via a competitive tender, one of the country’s largest insurance groups consolidated its legal panel from 50-plus to 20-something. This week, I heard the group has earmarked another wave of rationalisation – one which could easily see the panel cut by half again. It’s an extreme example, but not an isolated one. Tendering, once the exclusive domain of government, is now the preferred procurement mechanism for corporate Australia too. 

That being the case, if your firm’s tendering capability or performance is below par, it could be because you’re guilty of one of more of tendering’s ‘deadly sins’. Now is as good a time as any to atone.

Sin #1 - Cowardice

(Do you have the guts to make a tough decision?)

The best way to improve your win rate is to be selective (realistic) about what you bid for. If you have a business development team, or you engage business development consultants, you might have heard them use the expression “Go/No Go”. Go/No Go is a pass/fail test which can be applied to tendering situations. To pass, the ‘Go’ conditions must be met and the ‘No Go’ conditions must fail. 

For example, let’s say you’re thinking about responding to a tender issued by logistics company, Linfox. Your firm’s ‘Go’ conditions might include that you have expertise in the sought after areas of law, and that the client fit within one of your firm’s priority sectors. If you satisfy both criteria, great.

The ‘No Go’ conditions might include the absence of relationships with key people (influencers) within the organisation. No relationships, no go.

Whether or not you adopt the Go/No Go approach, or some other methodology, the point is that you critically assess whether you have realistic prospects of success. If you don’t, have the courage to walk away.

Sin #2 - Neglect

(Work the system)

If you’re considering responding to a tender, take full advantage of all of the opportunities to interact with the tendering organisation. 

If there is a pre-brief, make sure both your lead partner and business development manager attend as they will each be alert to different elements. Linger at the registration desk so you can identify as many of the other attending firms as possible – you need to know who your competition is. Pay attention to how your competitors interact with the client’s representatives. Take notes – especially during the Q&A as this is often where new information is revealed.

One law firm partner I work with refuses to ask questions during a tender. My attitude? Tendering is not the time to be coy – it’s your prerogative. Just bear in mind all of the respondents are likely to see the questions and answers so be careful not to give away your game plan. Beyond that, the worst that can happen is the client will elect not to answer.

Sin #3 - Prejudice

(Put your best foot forward)

If you have made the decision to tender, then presumably you want to win. So why would you compromise your success by not putting the best team forward? Yet, so many firms do just that. Instead of building their team based on who has the best technical and industry expertise, they allow politics, prejudice and greed to influence their decision.

I’ve worked with a firm whose main selection consideration was utilisation: “Put x on the team because he needs the work”. Another would commonly allow partner relationships (“There’s no way I’m letting that bastard near my client”) and financial structure (“I want to keep the billings in Sydney”) dictate their approach. These firms don’t need competitors – they’re their own worst enemy.

Sin #4 - Laziness

(Customise your CVs)


CVs are one the pain points for many firms. So often there’s tension between the lawyers and the business developers around who should be responsible for keeping them up-to-date. And everyone tries to avoid customising their CVs to the opportunity. I’ll say that again for emphasis: If you’re serious about your tenders you will tailor each team member’s CV to each opportunity. In some cases, that might be as simple as shuffling the order of experience. In others, it might involve removing whole sections and expanding upon others to highlight the niche expertise the individual has been nominated to provide. 

Burns, Jacqueline – Generic CV
Burns, Jacqueline – QBE tender
Burns, Jacqueline – Wesfarmers tender
Burns, Jacqueline – ATO tender


Sin #5 - Arrogance

(Answer the question)

When you’re media trained one of the first things you learn is to answer the question you wish you were asked. Not sure what I mean? Listen carefully next time a Minister is being interviewed on TV. He (or she) will communicate two or three key messages over and over again irrespective of the questions put to them. In tendering, it’s the opposite. To satisfy the evaluation panel, and allow it to compare like with like, you need to answer each and every question. 

In detail, if it asks for detail. 

Specifically, if it asks you to be specific.

I recall an exchange I had with a law firm partner when we were in the final stages of an important bid: 

Me:                   “It causes me angst when we don’t answer the question!”

Partner:             “Jaci, it causes me angst when we do!”


Sin #6 - Suppression

(Tender as evidence)

To me, it’s ironic that at a time when consumer brands are swooning over the opportunities presented by ‘big data’, law firms are still failing to analyse the intelligence within their own systems. Yet, all law firms boast about their matter management, case management, file management, workflow, knowledge management and relationship management software and systems. This failure is compromising their business development efforts. How? Because data provides evidence, and evidence mitigates risk. For example:

  • When asked about value-added services, most firms copy what was in their last submission, presenting an unoriginal, largely value-less, list of offerings. What they should do is tailor their value-adds to each client and, when re-tendering for an existing client, extract from their CRM system a history for every contact from that organisation: what they have subscribed to, what content they have received, what they have been invited to, what they participated in. Proof points.

  • When asked questions about local sourcing, most firms will get flustered and fall on a generic statement of willingness. Instead, they could analyse their workforce, suppliers and client base by postcode, and then graphically present their contribution to the region in question. Proof points.

  • When asked to demonstrate their knowledge of an industry sector, most firms will claim the sector is one of a handful it focuses on. A smarter approach might be to segment their client base by industry, have a track record of disseminating sector-specific content, be able to draw a list of practitioners who are not just members of relevant industry associations, but who are actively involved in steering committees and taskforces.  Proof points.
 
Whether in business or government, those in procurement positions must demonstrate they are acting ethically and transparently, and making evidence-based decisions. Data provides evidence, and evidence mitigates risk. I have proof of that.

Sin #7 - Ignorance

(What’s your strategy?)

All too often when I work with a new client or business development team, I discover the strategy piece is missing from their tendering process. That’s like marching in to battle without a plan or any clear sense of your opponent. It’s mad. In business development, as in war, you need to understand who you’re up against and how you will fare against them. 

At the very least, conduct a SWOT analysis. Developed by Stanford University in the 1960s, a SWOT will help you to identify what could help or harm your prospects. In my experience, firms often make the decision to bid based on their perception of their strengths alone, for example: “We have lots of experience in employment law, therefore we should submit a tender”. It’s an incomplete approach unless you also consider your firm’s weaknesses, and the external opportunities and threats.

Strengths

We have lots of experience in employment law.

 

Anecdotally we know our fees are much lower than our competitors.

 

Our employment team has capacity.

 

 

Weaknesses

Our employment law clients are small and relatively unknown compared with those of our competitors.

We are not an incumbent.

We may struggle to demonstrate sufficient depth in our team.

The client’s in-house lawyers are based in Melbourne where we do not have an office.

 

Opportunities

The new workplace legislation will require all medium to large employers to update their employment agreements.

The partners have been discussing opening an office in Melbourne for some time.

We could recruit additional lawyers if we were successful in this tender.

 

Threats

Many of our competitors have been preparing for this change for several months – we’re already on the back foot.

Some of our competitors are ‘buying’ this type of work in order to maintain a relationship with the client.


At the end of this process, you may very well have reached the same conclusion (to bid) but you will also be alert to the risks you need to mitigate or manage, the weaknesses you need to convert to strengths, and the threats you need to neutralise.

About our Guest Blogger


Jacqueline (Jaci) Burns is Managing Director of Market Expertise, an agency which services the marketing, business development, communications and associated human capital needs of professional services firms and companies in other knowledge-intensive sectors. 

Effective Business Development for Law Firms – Five Hot Trends in the New Normal©

Tuesday, June 10, 2014

By Julie Savarino, Managing Director, Business Development Inc and 2014 ALPMA Summit presenter


#1 Increasing staff sophistication and specialisation


Many law firms are evolving beyond primary reliance on the top three traditional marketing/business development tools used by lawyers to develop new business: speaking, writing and attending conferences. These three tools still work to create awareness and generate leads when used in a focused, targeted, strategic and consistent manner, but alone they are no longer enough to maintain competitiveness. 

So in order to increase results, efficiencies, quality of service and deliverables while at the same time reducing duplication and redundancies, law firms are moving away from hiring marketing/business development support generalists and are now increasingly hiring specialists. Specialists are defined as staff members who spend over 75% of their total professional time on one tool or practice/industry group or other area. Examples include RFPs, events, CRM, and client intelligence managers/coordinators. Practice/industry group specialists can include business development managers for the litigation, intellectual property, life sciences, tax litigation or other practice/industry groups. 

The other two most popular specialist positions being hired by law firms in recent years are:

a. Chiefs, directors or managers of client/business development/sales. 

These three terms are still used interchangeably but most often refer to the one-to-one “sales” or “selling” process. Sales, or client development, staff members are usually dedicated to supporting the entire sales lead process (i.e., they help identify and qualify opportunities; once an opportunity is identified, they help prepare for, execute and follow up on that opportunity to develop actual new work and track results). In addition, they may have responsibility for providing one-on-one, internal coaching to help lawyers attain the new business development objectives listed on their annual plans.

b. Pricing chiefs, directors and/or managers. 

Pricing is another popular “specialist” position that many leading law firms have recently created and filled. With the proliferation of AFAs (alternative fee arrangements), pricing professionals are dedicated to creating, maintaining and helping lawyers use price/profitability-oriented databases, software, and metrics and to assisting in crafting AFA options needed to pitch and win new business in this highly competitive market.

#2 Increased turnover in high-level staff positions

 

Over the past three years, approximately 40% of AmLaw 100 law firms’ incumbent chief marketing officers, chief business development officers and chief strategy officers have turned over. Some left due to retirement, others for life-style reasons, and others due to top management transitions and other reasons. The majority of open positions are being filled by professionals with a proven track record of direct business-to-business sales or client development and management experience, such as from financial institutions, investment entities, accounting firms, other legal service-related entities and/or other professional service firms.

#3 Increased strategic focus on what works


The days of being “all things to all people” either externally for clients or internally for lawyers no longer works for the majority of law firms or for law firms’ marketing/business development support departments. Law firm leaders’ expectations are evolving, and priorities are being increasingly decided upon and communicated internally. 

For example, in some law firms each and every partner is no longer expected to become a “rainmaker” in the traditional sense of the word, and as a result, annual plans and performance expectations are being tailored to maximize individual strengths. As a result, internal marketing/business development departments are no longer expected to service all partners equally. Instead, progressive law firms are assessing and analyzing where the sources of existing and new business come from by lawyer, activity/effort, investment, etc., and they are focusing support and investments of time and money accordingly. The roles of service quality, efficiencies and service features are also being prioritized.

# 4 Increased use of packaging


As the legal industry continues to mature, another viable strategy being used both internally and externally is packaging. Internally law firms are “packaging up” the sales/business development process in various ways designed to increase opportunities, motivation and strategic results. 

Two examples are “Speed Dating” and “Trade Fair” programs being implemented at firm partner or lawyer retreats, which leave participants with a greater understanding of what fellow firm lawyers do and how to raise the issue (i.e., work to cross-sell/service other firm lawyers’ services with appropriate clients or contacts). Several other law firms have created and implemented various “strategic business development challenges” or other gaming-type programs, which appeal to lawyers’ competitive instincts and fuel peer involvement. These types of challenges or games are launched during a retreat or at the beginning of the year and are tied to a formal “sales pipeline,” which is tracked and followed-up on, with efforts and results being highlighted and rewarded periodically by firm leaders (my company has assisted with many of these programs). 

Externally, law firms are packaging up services beyond simple industry definitions. A recent example is the hot issue of data privacy – a number of law firm services are required to handle, manage and resolve data privacy issues and cases (cutting across traditionally defined practice groups). Resolving data privacy issues/cases often requires that other outside forensic, forensic accounting and/or data management services be included in the package offered/presented and/or pitched to clients and prospects. As a result, law firms are packaging up legal services along with formally partnering with relevant outside services to offer a complete package of services.

#5 Increasingly sophisticated technology 


Content aggregators at both the law firm-generated content level and the business/client intelligence level are continuing to refine their offerings. In past years, posting relevant lawyer/firm-generated content to multiple social and Internet sites required more time than it does today because of advancing technologies. It is the same with business/client intelligence content. In the past, gathering this information required an entire checklist of sites and sources be searched. Increasingly, proprietary content owners are partnering so that less sources need to be searched to find everything. There is still no one-stop shop, but it is improving. 

Finally, apps created exclusively for lawyers and law firms are proliferating, and the next wave will likely be the consolidation and partnering of the most useful and viable.

Editor's Note:

Want to learn more about creating effective business development strategies for your law firm? Julie is leading ALPMA's pre-Summit Master Class Workshop "Mastering Client Development (a.k.a the 'Sales'  Process) for Law Firms" on Wednesday 25 August from 12.30 - 5.00pm at the Melbourne Crown Exhibition Centre.  Find out more.

She is also presenting a session on 'How to make the most of LinkedIn for Lawyers and Law Firms' at the Summit on Thursday 25 August.  Check out the full Summit Program.

About our Guest Blogger


Julie SavarinoJulie Savarino is a lawyer and Managing Director of Business Development Inc with over 25 years’ hands-on, highly rated and proven business development experience assisting lawyers, law firms and other professional service firms in developing measurable new business. 
You can email Julie for more information.

© Copyright, Business Development Inc.  All Rights Reserved. Without prior written consent from the copyright holder, it is illegal to copy, re-use and/or otherwise distribute the content of this document and/or the document itself. 

How well can your firm answer these tricky questions?

Tuesday, April 08, 2014

by Alistair Marshall, Partner, Julian Midwinter & Associates

We are nearly 100 days into 2014, and that makes it a good time for you to address some of those difficult questions that people like me enjoy challenging law firm leaders and managers with - before the year gets completely away from you.  

So sit down with the key players in your organization, and see how well you can answer the following tricky questions that will highlight your achievements and/or shortfalls this year to date.

Tricky questions your firm needs to answer


1. Do we have a marketing problem?

Do enough of our  prospective clients know:

  • Who we are?
  • What the result is of what we do?
  • What types of clients we do it for?
How do we convey our expertise to our target audience?

2. Do we have a business development problem?


What is our biggest business development challenge? Do we get plenty of new leads and opportunities to meet potential new clients, but somehow this rarely translates in to new revenue streams? How are we dealing with it?  Do we dedicate sufficient non-billable time each week to business development activities?  Do we outsource to an external source of help?  How long have we had the problem? Are we improving or getting worse at this increasingly more important side to our work?  What have we done to address it? (Maybe very little as yet - I am a lawyer, not a salesman, right?!)  Are we hoping that if we ignore it, the problem will go away?  Do we avoid business development tasks because they are outside our comfort zone?  Do we leave it up to our Marketing Department staff to attract new clients? How is it impacting the organization?  Are there reduced revenues or drawings? 

3. Do we have competitive issues?


Have we recently lost a large client to a competitor?  Have low cost new entrants started to affect our local market?  

4. Do we have people issues?


Is it becoming increasingly difficult to attract the best staff or lateral hires? What is it costing us? If it continues, what will the effect on the business be?  Could we lose key staff to competitor firms?  Are there underperforming staff, practice areas or suppliers that need attention?  How do we know?

5. How can we improve our productivity and performance?


Would we have to further reduce costs across the board?  Where do we want to be next year, or in three years’ time?  What do we need to do now to ensure that happens?  Do we measure all the necessary Key Performance Indicators? 

6. What should we do more (and less) of?


What are we good at and should we do more of?  Do we focus on key areas and be seen as experts in a field where we can charge a premium?  What are we poor at and must stop doing?  What will we do differently tomorrow to ensure we hit our financial and lifestyle goals?  To paraphrase an adage, if you continue to do the same things over and over again, why should you expect different results?

Do not under estimate the importance of identifying and then addressing these issues.  Experience tells me that the winners will create a written action plan with numbered tasks assigned to specific individuals to be achieved within a given timescale. Let me know how you get on.  If you need help in how to overcome some of the challenges here, all you have to do is ask.

About our Guest Blogger


Alistair MarshallAlistair Marshall is a partner at Julian Midwinter & Associates.  After running a successful consulting business in the UK, Alistair relocated to Australia in 2013 to help professional firms attract new clients and win more new business. As a business development expert, he has worked with leading law firms, accountants, banks and household-name corporates for more than twenty years.  

His specialty is implementing simple, achievable, and cost-effective business solutions to small practices through to large regional and national firms.  His track record demonstrates consistent results in achieving double digit growth in new client instructions.  He has authored three books on the subject of sales and marketing, the most recent entitled “The Complete Business Development Guide for Professional Firms”.

We get referrals - don't we? How to generate quality referrals for your law firm

Tuesday, July 23, 2013

by Neil Kafer, Director, Boost Your BD


Let’s face it – you’re leaving money on the table. Lots of it.

A recent survey* of one thousand clients of professional services providers found that 83% were comfortable providing a referral for their advisor, yet only 29% actually did. That’s a lot of new revenue being left on the table.

Why is there such a wide gap between clients’ propensity to refer and actual referrals?


There are three reasons behind this referral gap:
  1. Advisors aren’t asking their clients for referrals.
    Many feel that the act of asking for a referral somehow cheapens the client experience. The professional mindset seems to be that clients will just naturally appreciate the mountain of value that they have had delivered, and can’t wait to tell everyone. Won’t they?

  2. Advisors don’t educate their clients about what a good referral for them looks like.
    Consequently clients won’t refer rather than risk their own relationships.

  3. Clients aren’t looking for the “triggers” that identify a prospect for their advisor.
    Unless a friend or family member expresses a specific need for that service, clients don’t know the implicit signposts for the referral. For example, it’s more likely that someone will tell you that they have just gone into business for themselves rather than ask you if you know where to get business insurances or commercial legal advice.
There is another important realisation from this data. That is - you can’t be relying just on your clients for referrals. Let’s say that again – you can’t rely solely on clients for referrals. You need to go broader and deeper into your networks. Many professionals pride themselves on building their businesses by referral. It affirms their self-image as sought-after experts and “trusted advisors”. However, the facts are that they are really only dabbling in referrals at best.

In April 2013, we surveyed 100 professionals across disciplines such as accounting, banking, engineering, law and property. All of them responded that they took a proactive approach to creating referrals. Yet a deeper dive into their approach (see the table below) revealed that they are languishing in their referral marketing practices.
 

QUESTION

YES

NO

DON’T KNOW

Do you proactively use referrals from clients and others as a way to grow your business? 100%  
Are referrals seen as an integral part of your growth strategy, or as some-thing that might or might not happen through ‘business as usual’ activities? 57% 43%
Do you use a structured referral marketing plan to guide your approach to getting referral business? 21% 79%
Do you receive formal training in how to apply referral marketing and networking concepts? 18% 82%
Do you formally recognise or reward referral sources for recommending you to prospects? 39% 61%
During client feedback meetings, do you ask how likely that the client would recommend you to others? 20% 80%
If the client would recommend you to others, do you ask for a referral? 100%  
Does your CRM system or Contact Management System allow you to enter a referral source? 19% 41% 40%
Source: Boost Your BD survey, April 2013 - 100 professionals in the Australian market

There are a number of telling responses in this data, but perhaps none more so than 100% of respondents saying that they would not ask a client for a referral even though that client indicated that they would provide one!

What can you do to improve your performance with referrals?


The survey data suggests that the simple act of asking for a referral will radically improve performance. The act of asking for a referral has two components:
  1. The “mechanical” aspect 
    That is, what channel to use (face-to-face, email, letter), what words to use and when the best time to pop the question is.

  2. The “cultural” aspect 
    That is, how to avoid feeling embarrassed about asking for a referral and how to avoid coming across as some kind of “white shoe-wearing” sales person.
The mechanical aspects cannot be addressed until the cultural aspect, or mindset, is resolved. There is a way to simultaneously manage both aspects in the process of asking for referrals. That is to take a much more strategic view of referral marketing and develop a program to build a net-work of trusted referral partners who become your de facto business development team. They are identifying and qualifying opportunities for you and facilitating the introductions between you and your new prospects. And you are doing the same for them.

What do you need to do in order to build a high performing, strategic referral network? 


There are some key steps in the process that I have set out below.

1. Know your target market and your value


You need to get very clear on who makes up your target market and very crisp in the articulation of your value proposition. This is no different to any other business development strategy. With a referral program there are two main reasons for getting this clarity:
  • Because you need to identify and recruit the right referral partners. There is a high probability that these people will be active and known in and around your target market.
  • Because your referral partners need to know what a good referral for you looks like. Your network has to understand what you do, who you do it for, how you do it, how you com-pete, how you are different, where your value lies and if there are certain segments of your market that you prefer.

2. Identify your referral network


Not everyone you know will make a good referral partner for you. Some people will be better suited to providing you with information. Some will be better suited to providing you with moral support. Some will be able to recommend you to unqualified prospects. And then some will identify prospects, qualify them, tell them all about you and make sure you get personally introduced.

You need to build a team that is capable of getting highly qualified prospects to meet with you. Some of your best referral partners might not even know you – yet. You need to look beyond your existing contacts to identify people that you might not even know, but you recognise that you need to get to know them and recruit them into your network.

3. Get your relationships at the right status


There is a simple model for defining the relationship development process that will drive high referral performance and help you identify where you need to spend your time.

The first relationship stage is Visibility. This is where some-one has an awareness of another, but there has not yet been any kind of activity between these people that is creating a relationship of trust. Without Visibility, you aren’t even in the game.
The next stage is Credibility. This is where there has been some form of engagement between the people and some form of value has been delivered. Trust has been, or is being, developed. It might even be that one party is delivering referrals to the other.

The final stage is Profitability. At this stage both parties are benefiting from a mutually rewarding relationship. Both are delivering highly qualified referrals to each other and converting these referrals into clients. You need to know the actions to take in order to drive each of your key referral partner relationships to the Profitability status.

4. Train your network


Upon receiving a referral most professionals get the prospect’s contact details, call them sometime later and introduce themselves along the lines of: “Hello Ms Prospect, my name is John Professional. Fred Referrer suggested I call you. I am a lawyer...

Handling referrals in this way produces minimal results. Your chances of success are greatly in-creased if your referral partner is trained to do the following:
  • Make initial contact with the prospect, qualify the need and ensure they are comfortable with an approach from you.
  • Provides the prospect with information about you and your business.
  • Explains the nature of your relationship to the prospect.
  • Gives the prospect a brief description and endorsement of your service.
  • Arranges to personally introduce the prospect to you.
  • Follows up with the prospect after you have made contact.
If you don’t ask your referral partners to do these things, they won’t. Not because they aren’t willing, but because they don’t know the difference that it makes, or they don’t have enough information about you, or they simply don’t know how.
There are two key actions for you to take – educate your partners about all of the actions you need them to take; and provide them with all of the materials necessary to accomplish those actions.

5. Measure the results


An essential part of any marketing plan is measuring the results, and referral marketing is no exception. To use your sources effectively you’ve got to know if your referral marketing is working, how you can change it to improve results and how much your investment of time and money is earning you.  An effective referral marketing process should be measured across three key categories – networking activities, referrals received and closed business. 

There is a lot of market validation for the effectiveness of referral marketing. Referred prospects are between three times and fifteen times more likely to buy from you, two to three times more likely to refer you to others and are four times more loyal. And do you know what else? As much as you like to meet prospects through a referral, they prefer to meet you that way as well.

It’s time to stop leaving money on the table. Don’t you think it’s time to do more than pay lip service to referrals?

*The Economics of Loyalty”, December 2010, Charles Schwab Advisor Services and Advisor Impact

About our Guest Blogger


Neil KaferNeil Kafer is a senior Sales and Marketing executive whose experience advising into the professional services sectors includes roles as Head of Sales and Marketing Operations at KPMG, Head of Business Development and Major Clients at Norton Rose and senior sales roles at PwC and in the I.T. industry. 

As a Director of Boost Your BD, Neil trains professionals in developing and deploying structured referral marketing programs that drive deeper client engagements and consistently improve revenue performance with achievable ROI greater than 50%.



How to reduce your cost of sales and ramp up firm revenue by eliminating no decision

Tuesday, June 11, 2013

by Mike O'Horo, Co-founder, RainmakerVT

Your clients pay a lot of attention to cost of sales (COS) as a way to increase profitability. Law firms don’t think about, much less track, COS.  Despite that, you can still reduce this expense by modifying your sales philosophy and behaviour.  

Lawyers consider only direct competition. “Either our firm will win or Firm X will.”  This ignores a big possibility: 

Nobody wins the business.


Research says that, in 30% of buying/selling situations, “No decision” wins; it’s your biggest competitor.

“No” is better than “no decision.”  It lets you abandon moribund initiatives, which ends cost-of-sales and lets you invest elsewhere instead of spending time and money continuing the pursuit.  

There are two ways to improve revenue-generation:

1) Create more sales opportunities 
2) Convert more sales opportunities

Creating more opportunities is important, but can be expensive.  BTI Consulting Group estimates initial Cost of Client Acquisition (CCA) for a $200,000/year client at $35,000 - $100,000.

Despite this, law firms emphasize lead-generation and ignore conversion rates, especially one element that’s easy, free, can be applied immediately, and has a far greater effect on net revenue than creating new opportunities. 

The Impact of Eliminating No Decision on Revenue

Let's take a look at the effect eliminating "No Decision" has on a firm's net revenue by comparing the impact of adding 50% more opportunities to the pipeline vs. eliminating "No-Decision.”


 
 30% "No Decision" Factor  Non-Decision Factor Eliminated
Gross Annual Pipeline Value of 100 Prospects   $20,000,000 $20,000,000
Less No-Decision Factor  $6,000,000 $0
Net Pipeline Value Less No-Decision Value $14,000,000 $20,000,000
Sales Closing Rate (40%) $5,600,000 $8,000,000
Cost of Sales ($35,000 x 100) $3,500,000 $3,500,000
Net Revenue $2,100,000 $4,500,000

You see how eliminating No-Decision yields 43% more Net Revenue than increasing your pipeline by half:

  30% No-Decision
Gross Annual Pipeline Value of 150 Prospects $30,000,000
Less No-Decision Factor  $9,000,000
Net Pipeline Value $21,000,000
Sales Closing Rate (40%) $8,400,000
Cost of Sales ($35,000 x 150) $5,250,000
Net Revenue $3,150,000

How to Expose No Decision Situations


No Decision results from selling against a problem of low priority. The prospect has the luxury of doing nothing.  You must expose this by 1) exploring the Cost of Doing Nothing, and 2) mastering Stakeholder Alignment.  

The Cost of Doing Nothing process is a series of questions that reveal whether or not a prospect MUST do something about the problem:
  • For this stakeholder, what are the current consequences of the problem? 
    • Strategic consequences
    • Operational consequences
    • Economic consequences
    • Emotional consequences

  • Are those tolerable? 
    • If so, there will be no decision. 
    • If not, this stakeholder will be motivated to help you identify and recruit the critical-mass Sponsorship Group.
This is then the beginning of the Stakeholder Alignment process, by which you also recruit and guide a “champion” through a facilitated process that enables the sponsorship group to align behind some type of decision, i.e., to make a confident, sustainable decision.
Lead-generation and eliminating No-Decision are not mutually exclusive.  Eliminating No-Decision gives lawyers more time to generate other leads.  The Cost of Doing Nothing process saves lawyers from drilling dry holes, but it’s also what buyers prefer because it places their best interests above those of the seller.

Singularly pursuing a “yes” is not the way to get hired.  Helping prospects make good decisions is.  If you help prospects recognise that their Cost of Doing Nothing is unacceptably high, you're uniquely positioned to win the business, and clearly differentiated from competitors who cling to the pitch model.

About our Guest Blogger


Mike O'Horo is a US-based serial innovator in the law business.  His current venture, RainmakerVT, is the world's first interactive online rainmaking training for lawyers, by which lawyers learn how to attract the right kind of clients without leaving their desks.  

For 20 years, Mike has been known by lawyers everywhere as "The Coach".  He trained more than 7000 of them, generating $1.5 billion in new business.  

Winning the Future Part 2 : Challenges for Practice Managers to Address for Strategic Planning

Tuesday, April 23, 2013

By Ted Dwyer, Director, Dwyer Consulting


In last week’s ALPMA blog post, I discussed why strategic planning was imperative for law firms and the four key questions law firms need to address during the process. This post addresses some of the challenges Practice Managers can face in the strategic planning process - and provides some practical tips to overcome them.   

Practice Managers are often not owners. This can make their role in the strategic planning process more difficult, especially in conservative cultures such as law firms. In order to play a constructive role, you need to:

Understand Your Role


As a practice manager, nothing will happen unless you have the business owners involved. A beautifully drafted strategic plan that gathers dust on a shelf is useless. You’re aiming for a plan that has the buy in of the partners from the start, that is regularly reviewed and actually implemented. Your role is to be a facilitator, setting up the process that the owners will implement themselves. 

Answering Objections: Understanding Lawyers


It all seems so simple – the market demands it happens and you should assume that your competitors are doing it, so shouldn’t we be getting a strategic plan in place? As anyone experienced with law firms will tell you, however, it just isn’t so simple. Some firms may decide it is all too hard and do everything they can to avoid the process. Partners may not engage with the process, even though they politely agree with you. Bringing lawyers on board – even if the plan is a positive one – is often challenging. There has been a lot of research done about common personality traits in lawyers. A better understanding of how the decision-makers in the firm ‘tick’ is therefore useful. Consider these five personality ‘traits’:
 

Trait

Meaning

Implication for Practice Managers

Scepticism

Multiple studies confirm that lawyers are highly sceptical. Highly sceptical people are often judgmental, argumentative, questioning and sometimes cynical. In other words, they will resist change unless they absolutely need to.

Great trait for technical lawyering. Not so great for managing, which usually requires collaboration, a degree of risk-taking and mutual trust. Scepticism needs be diluted with data-driven communication. Use statistics, concrete facts and benchmarking information to drive home your argument.

Urgency

The studies indicate lawyers are often high on urgency, compared to the average population. Impatient, they seek to get things done immediately. The opposite are people who tend to be more patient.

The highly stressed partner may want a ‘strategy’ or ‘strategic plan’ far too quickly. The best thing to do is to arrange for the partners to assemble away from the office (an ‘away day’ or weekend is typical). Also, find a ‘champion’ to help you – see below.

Sociability

It’s hardly surprising, given the nature of the law, but lawyers often find it difficult to initiate and cultivate relationships. Lawyers often prefer interacting with intellectual issues, rather than with people.

Strategy and business development are profoundly human activities. An effective strategic plan relies on collaboration with people with mutual respect, often in a spirit of inquiry. As practice manager, you need to think hard about how to create an atmosphere that cultivates this.

Resilience

Lawyers are over-confident and arrogant? Think again. The studies indicate that most lawyers are lower in resilience than most people think. Many are very sensitive to criticism and use self-protective tactics (often razor-sharp sceptical intellect) to bolster their low resilience.

Be positive about individual contributions and reinforce that everyone is accountable (not just a particular partner). When managing a lawyer who is ‘putting up the shutters’, use language that accepts their point of view (for example, ‘I see your point of view, but…’ or ‘You are totally right, but I was also thinking…’) to keep them engaged.

Autonomy

Lawyers place a great deal of importance on their independence. This can be great for clients, but it can also result in someone who doesn’t like being ‘managed’. Any threat to this sense of independence is likely to be greeted with resistance – the last thing you need!

Show, don’t tell. Show the partners what other firms are doing.  Show the partners what is happening in the market. Show the partners the latest benchmarking information. Use external experts to direct focus away from you (see below).

Whatever you do – don’t tell lawyers what they have to do, or must happen. Even if you’re right, it probably won’t get you anywhere!

 
Find a Champion


Find a champion among the equity partners. In most sophisticated law firms, there will be a partner who is interested in strategy and actually thinks beyond the one year profit drawing cycle. There may even be two! These are the people who can drive the process in the ownership group. You need to explain to them what you are seeking to achieve, and then to ask them for their help. 

Engage - Be Enthusiastic


Don’t be afraid to take the initiative on these issues, alone or with champions. Invite guest speakers to the firm to present to the owners. Circulate literature and media about the issues. Ask the partners/ owners for their opinions and views, as well as pressures they are facing. 

Consider External Support


External expertise is useful. But I would say that, wouldn’t I! A quality consultant with industry experience not only understands what the competition is doing, but also directs the focus of partners away from internal people to an external person. It’s important that the external expert is confident enough to challenge assumptions being made by the firm. Also – use someone who understands law firms, as well as lawyers. There is nothing more embarrassing than watching partners ‘switch off’ when an external person starts using management speak that turns partners off.

Plan to Plan


A typical strategic planning process can take 3- 6 months, involving extensive consultation with partners, staff and external experts. There is a lot of work involved. You should think of it as a project with specific objectives and deadlines. A methodology, with sequential steps, is useful. It provides structure and focus. For example, I use a methodology including specific steps in each phase. Another thing to get right is timing. It’s probably a good idea to ensure that the strategic plan aligns with the financial year, so that the partners can evaluate success with their normal planning cycle. The consultation and analysis of the firm, each service area and the quality clients, needs careful planning. 

About our Guest Blogger

 
Ted DwyerTed Dwyer (BA, LLB – University of Sydney, MBA - MGSM) is an expert in strategic planning for law firms. A solicitor, Ted has helped law firms navigate and then succeed in today’s challenging market.

Dwyer Consulting advises leading law firms on strategy, pricing and profitability issues. Using its CADRE methodology, law firms will be able to accurately diagnose their current strategic position, before designing and executing a plan that prepares them for future success. Dwyer Consulting is also used as external facilitators by law firm partners and senior managers to assist in exploring sensitive issues, such as profitability, pricing, competition and client relationships.

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