As reported in today’s The AmLaw Daily some "Law Firms Cautious About ACC Ranking System." You may recall that the Association of Corporate Counsel announced their Value Index at last month’s annual meeting in Boston; and that it involves ranking outside law firms "based on evaluations from in-house lawyers." Apparently a number of firms aren’t too happy about that, and the anonymous nature of the evaluations.

Is it because they won’t see the evaluations, or because they’re being evaluated in the first place, that their unhappy?

Two thoughts come to mind. The chance that these evaluations will not be seen by outside law firms is nil. Even in-house counsel think that the outside law firms will get their hands on their evaluations. Why else would two thirds of them ask that their evals remain anonymous? So, it’s a foregone conclusion that law firms we’ll get to see their evaluations. Guaranteed. All they will need is one friendly in-house counsel.

Thus, it seems clear to me what firms may not like is the fact that they are being evaluated in the first place; and they may not like the evaluations, and the fact they don’t know who made them. Some consultants have even suggested that law firms “get even” by starting their own value index of in-house counsel. What bloody nonsense. I hope they were kidding. Just what a law firm needs, getting into a pissing match with the sources of its business.

The solution to all of this is quite simple. Talk to your clients. Ask them how you’re doing. Correct any problems. Then the evaluations will take care of themselves.

O-K-A-Y, I know it isn’t quite that simple. But, too few law firms even seek client feedback, and they should be very concerned about the evaluations they’ll receive. They could make a huge step toward favorable evals, if they institutionalized a client satisfaction program. End of fuss.

The Association of Corporate Counsel (ACC)’s Value Index was announced and shared with members at last month’s annual meeting in Boston. As reported in my earlier post, the criteria for measuring outside law firm’s performance is based on a grading system from 1 (poor) to 5 (excellent) relating to the following service areas:

  1. Understands Objectives/Expectations
  2. Legal Expertise
  3. Efficiency/Process Management
  4. Responsiveness/Communication
  5. Predictable Cost/Budgeting Skills
  6. Results Delivered/Execution

Joyce Smiley in her November issue of “Verbatim” relates that a key question is also part of the index; to wit: “Would you use this firm again?;” and the ACC encourages “law firms to adjust their client satisfaction criteria to match the Value Index.”

A wise move. Suffice it to say, every firm should ask at least their key clients how they stack up against those six criteria whether their in-house counsel belongs to ACC or not. And such inquiries should be made by the managing partner or an outside third party, but not the attorney(s) working on the clients’ matters. A firm is more likely to get honest answers that way.

According to the recently released survey by the Association of Corporate Counsel and Serengeti Law, the top priority for CLO’s, for the first time in the survey’s eight years, is “controlling the costs spent on outside counsel,” as reported in today’s issue of The AmLaw Daily.

Further, the ACC Value Index will be released today at the ACC annual conference in Boston, and consists of evaluations of a number of factors on a scale of 1 (poor) to 5 (excellent), including:

  • Understands Objectives/Expectations
  • Legal Expertise
  • Efficiency/Process Management
  • Responsiveness/Communication
  • Predictable Cost/Budgeting Skills
  • Results Delivered/Execution

There is a wealth of information about the ACC Value Challenge (of which the Value Index is just a part) and what it means to outside law firms. Check out the following for some great insight into how your firm can become a player in the ACC Value Challenge:

What has this got to do with marketing and business development? Everything! As I have been preaching ad nauseam, there is a lot of potential work for small and mid-sized firms with ACC companies as a result of the current economy, and the high costs associated with BigLaw. Seriously.

Do you know the real answer or are you just guessing? Those of us who provide client feedback services, and have reported how favorable clients react to satisfaction surveys, have an obvious bias. But that makes it no less important to ask your clients how you are doing.  I have written a number of times on the topic (see Continue Reading below for some of them), and Aronson/Heintz Associates has a thoughtful piece on their web site. And, last week Joyce Smiley reported on an article in the August issue of The American Lawyer by Editor-in-Chief Aric Press quoting him as saying that “It’s time to talk to your clients…You can either be part of their (clients’) deliberations and process, or you can be surprised by their conclusions.”

Therein lays the rub. If you don’t ask your clients how you are doing, and they have issues, you won’t be part of the process. And you may never learn about possible problems, even after clients have “migrated” to another law firm. It just doesn’t make sense to not protect your most valuable assets – current clients – at least the key ones.

This is so important that I even wrote (to my own potential detriment) in “Of Counsel” last October that it made sense to hire someone in-house full time to do them, as four firms had done. (Unfortunately, two of the four firms no longer have someone in-house dedicated to that role.) Whether you pay a consultant to do the satisfaction surveys or do them in-house isn’t the important point. Doing them is.

Client satisfaction surveys are so simple and relatively inexpensive, when compared to overall marketing budgets in most firms, that it is a wonder that many firms still don’t do them. When one considers that 70%-80% of new business comes from current clients or referral sources (often clients themselves), it is baffling.

So again, why don’t more law firms ask their clients if they are satisfied with their services? I want to say I don’t have a clue, but unfortunately I do. Too many firms are afraid to ask, or think they already know what their clients think, thus negating the need to ask.

Unfortunately, both are wrong answers.

 

Continue Reading Are Your Clients Satisfied With Your Services?

More and more it seems that in-house counsel are expecting their law firms to ask for their feedback. Even though “most general counsel and consultants say those law firms (seeking client feedback) are still in the minority and there isn’t nearly enough of this type of dialogue going on” according to an article on Law.com’s In-House Counsel.  I realize this is an old saw of mine, but it does appear that, with the growing popularity of the Association of Corporate Counsel’s Value Challenge, it will become the norm.

Dan DiLucco of Altman Weil relates that when the attorneys at one of its clients were asked whether their “largest client was forced to cut” its legal budget this year, no one had a clue. As DiLucco put it:

“So what does that tell you… And that…is reflective of where a lot of firms are. They don’t have these discussions. I don’t know what they are thinking.”

The managing partner of one firm mentioned in the article, that has sought feedback through a client panel, said that “reaching out to clients in a proactive way shows a firm cares about their opinions, isn’t afraid to hear them and isn’t going to wait for the clients to take the first step.”

A wise model to follow, I would say, for those firms that want to be out there ahead of the curve. Not only do clients want to provide feedback, they don’t want to have to initiate the discussion.

A new survey by The BTI Consulting Group, as reported in Law.com’s In-House Counsel, tells us that corporations are reducing the number of secondary law firms they use, not just to save costs, but to save administrative time in managing outside law firms.

Survey data show the following breakdown of the reduction (and intended drop) in the number of outside firms used:

  • 2007 – 2/10/40 (primary law firms/secondary/other firms)
  • 2008 – 2/9/32
  • 2012 – 2/6/23

Okay, the data are telling but not conclusive, and 2012 is a long way off. Further, the “new legal model” (whatever that means) could be very different by then. What might this mean for medium to smaller firms, when they are not one of the client’s “primary” law firms.

The survey also shows that corporate counsel are reluctant “to work with firms that aren’t flexible in billing, staffing matters and communicating with the client,” according to Michael B. Rynowecer, president of BTI. Moreover, in spite of the reduction, it showed “the same companies making a marked migration to smaller firms.”

So, what’s up? Well, it seems that non-BigLaw firms that demonstrate billing and staffing flexibility, and effectively communicate with the client are very much in play even as the number of overall firms is reduced.

One suggestion, along the communication line, would be to ask corporate counsel how your firm can help in reducing the administrative time (and costs) of managing their outside matters. 

As mentioned on several blogs, and in an ABA Journal online article, a recent survey of CLO’s made clear that in-house counsel aren’t buying the concept of a “new legal model.” It isn’t that they don’t want one, it’s just that 75% gave their firms a 0 to 4 (out of ten), “indicating that firms have little or no interest in change;” that is, delivering greater value for the services provided. According to Dan DiLucchio in a press release issued by Altman Weil, which conducted the 2009 Chief Legal Officer Survey, “[T]his is a dramatic vote of no confidence from chief legal officers.”

What that means for the more flexible, responsive medium- to small-sized law firms, is that they could make serious inroads into the once exclusive large firm domain. How? Some of the ways might include:

  • Increasing value in terms of pricing products and how the services are delivered;
  • Offering alternative fees, including flat fees;
  • Improving responsiveness and timeliness of services;
  • Seeking more client input and feedback;
  • Offering freebies, including CLE seminars, short phone calls, emails, etc.;
  • Stopping the nickel and diming of clients relating to overhead costs;
  • Avoiding surprises and providing regular updates at no charge; and
  • Taking time to really understand the client’s business off the clock.

A simple way learn what clients want in terms of value is to ask them what they would like to see in that regard. Not only will these firms learn what will make their existing clients happy and raving fans, but what would likely sell to those CLO’s that don’t believe their current firms are serious about a new legal model.

In my last post, I talked about some simple, smart ideas from Reid Trautz that were pretty easy to implement. One of them involved lawyers “experiencing” what clients experience upon entering the firm’s office.

Building on that idea, I came across an interview of Gerry Riskin of Amazing Firms, Amazing Practices by Arnie Herz of Legal Sanity. Although there are consultants out there who openly refer to themselves as experts or gurus (no names of course), Gerry is not one of them, because he doesn’t have to, and because he is too classy. But, he is one. And I’ve been a fan of his for years.

In his exchange with Arnie, Gerry relates a simple tale of how a powerful, successful person he met on an airplane told him in response to a question that his “biggest complaint about a law firm” was his “reception area experience.” He was pretty much ignored by everyone, including partners, who traversed the area as he sat there. It was as if he didn’t exist. I can sorta empathize with that person, except for the billionaire part.

Gerry points out that obviously this is not intentional behavior, but rather "blind spots, based on familiarity." He then goes on to say that what is needed is a fresh set of eyes, and "the best source of fresh eyes is your clients." And the way to get them is to ask your clients what they like and don’t like about their experience with your firm, and what should be done differently.

Good client experiences = successful business development.

Not only is client feedback important, but in past posts I have sung the praises for in-house client feedback programs that demonstrate to clients the firm’s management is sincere in determining whether the client is satisfied with the law firm’s services.

An article in last month’s Strategies, the journal of the Legal Marketing Association by Joyce Smiley wrote about providing real value to clients with satisfaction surveys. Her article covered two points that I agree with. First, the firm should conduct client feedback surveys, and secondly, that law firms need to develop a “complete program” after a few initial successes.

Smiley mentions three surveys, two by The American Lawyer. One late last year where only "2% of the responding firms made the effort in 2008 to meet with their top 20 billing clients. The other survey was of in-house counsel members of the networking site Legal OnRamp who "reported that their outside firms don’t even bother with client satisfaction surveys." The third survey was of LMA’s members that showed that in 2008 client feedback was “respondents’ lowest (budget) priority.”

Okay, so the message is clear. Client satisfaction checking wasn’t a big deal in 2008. And based on this year’s marketing budgets, you can be certain that they ain’t lookin a whole lot better for 2009.

The bright side is that a few firms are taking a longer term view by actually establishing in-house feedback programs, as I reported in an Of Counsel article last October. One firm I mentioned, Duane Morris (who unfortunately let their “client interviewer” go with a round of staff layoffs just before the article went to press), was also highlighted by Smiley. It’s good to hear that DM’s program is still ongoing.

Whether the firm has an in-house program or uses outside consultants for their client satisfaction surveys, they need to be careful that the feedback programs are not perceived by clients as just another marketing fad. Smiley reports in her article on how one in-house counsel, who was asked to be part of a client panel at a law firm, felt that the discussion was really about marketing, rather than client satisfaction. Moreover, this in-house counsel stated “we’re going to do (performance reviews) internally,” since the law firms weren’t serious about doing them themselves.

  • Lesson One: Conduct client satisfaction surveys (whether using an in-house program or an outside 3rd party) or you can be certain that the client will be riding that horse; and
  • Lesson Two: Be sincere (make sure your efforts come across as truly seeking feedback and relationship building), and the marketing will take care of itself.

The American Bar Association recently asked lawyers to predict the future. Over 14,300 lawyers responded, and yesterday the ABA issued an early summary of the survey results to those who had participated. Some results:

  • 19% of lawyers expect to lose their jobs,
  • 78% anticipate that "everyone" will be affected in some way by the recession,
  • 59% agreed that the profession will be "rocky for awhile," and
  • The majority held that the legal business won’t improve until 2010.

Based on these early results, it seems clear that it’s time to crank up your marketing going forward. The reasons are pretty straightforward:

  1. Take a look at my January 2005 post "Rainmakers Don’t Get Fired!," and
  2. “Plan to Crank up Marketing Budget in 2009. Huh?,” because many firms are likely to be cutting their budgets next year, and that means it is a great time to get out ahead of the competition.

So, now is the time to increase, not decrease the firm’s business development efforts.