Since the Great Recession of 2008, the market for legal services has changed. A rapid shift from a seller’s market to a buyer’s market empowers clients to have more control than ever before over fundamental decisions about how legal services are delivered. In addition, clients are demanding increased efficiency, predictability and cost effiectiveness in the way matters are handled. Because of these shifts, reputation is no longer a strong enough framework to sustain growing your practice.
Despite the constant change in competitive landscape, some lawyers continue to operate within a passé model that “yesterday’s touchdowns (read: tactics) will win games (read: business) today.” Perhaps this mindset is the impetus behind The American Lawyer’s August 17, 2017 article entitled, “Law Firms Still Suck at Business Development, Survey Finds.”
Workplace ratings company, Views- Hub, sampled more than 50,000 employees at companies across nine industries to learn the effectiveness of their own internal business development efforts. When compared against other service professions and industries – technology, media, communications, financial – law firms, on average, are embarrassingly below average, finishing bottom of the pile.
Savvy lawyers and law firms will continue to meet market demands by hoeing their approach and identifying those business development and marketing pursuits that result in better, more profitable matters.
In the coming weeks, attorneys across the country will embark on the beastly exercise of planning and budgeting for the year to come. Reflecting on that activities that “worked” and those that did not is part of the process.
One method for taking your game from good to great is a framework I have developed called The 15 People Concept. Essentially, identifying those professionals – five clients, five prospects and five referral sources – who are most able to make a significant impact on the growth of your practice during any given year.
Ideal clients are those individuals or organizations that have demonstrated a willingness to hire you at your current rates, reputation and offerings. In other words, they appreciate and compensate you for the value you provide. When prospecting, these are the types of pursuits that deserve the lion share of your focus and attention.
When evaluating the strength of a client relationship, realization rate – the percentage of fees collected versus fees billed – is one metric to track. Although it is practice specific, a generally accepted realization rate should range in the mid-to-high 90th percentile. Client relationships that fall outside this range should be more closely analyzed and, in some cases, resigned.
Identify five clients in the coming year that you can expand by at least 10 percent.
Proper prospects are those individuals or organizations that need your services but have yet to choose you to satisfy them. Remember, marketing is not about what you are capable of handling, it is about pursuing the type of work you want more of. Prospects should be similar to your current clients as you are likely familiar with their industry, business challenges as well as opportunities.
In most cases, your prospects are currently represented by counsel, so part of the process of converting them to clients is being able to demonstrate and communicate why you are a better option than their current counsel. Identifying your value propositions – unique identifiers like specific expertise, experience, background or approach to client service – can provide powerful reasons why a prospect would consider a change to you.
Identify five prospects, by name, that you can pursue in the coming year. Take the process one step at a time. Utilize your network to achieve a warm introduction or the first meeting.
Investors are other professionals – former colleagues, fellow lawyers, accountants, bankers, consultants, etc. – who are in a position and are willing to refer you work. Another way to think of them is as two-way referral sources – they will refer to you if you will refer to them.
The commonality between you and your investors is that you are both in growth mode. Once you have identified five investors, consider having a direct conversation with them to ensure they know you plan to refer your clients and contacts to them when a need arises. You expect the same in return. Monitor your investor relationships by tracking the referrals received and those given. Do not waste your time with a one-way referral source who is always happy to receive but who never returns the favor.
For the coming year, set a goal to receive (at least) one referral from each of your investors.
When it comes to next year’s success, you have a choice. You can play where the puck is (in other words, proceed as you have years past), and survive or increase your focus and intention by implementing The 15 People Concept and thrive.