Asian law firms need to focus more on client and employee satisfaction

By Robert Sawhney, Managing Director, SRC Associates

If you ask law firm partners what contributes most to profitability, you’ll normally hear some variation of leverage and/or utilisation. This is particularly so in Asia where, in the past few years at least, business has been so good that most firms are not overly concerned with
issues such as client satisfaction, since they believe that recurring clients must be satisfied, as otherwise they wouldn’t come back!

Of course, leverage and utilisation may form part of the mathematical equation in terms of calculating profit, but it is the underlying constructs of a market and knowledge orientation that determine profitability. Leadership plays a significant part in creating a high performance culture, and hence training and coaching also play important roles.

There is now a significant amount of research that demonstrates a strong link between employee satisfaction, client satisfaction and firm performance. Known as the service profit chain, smart firms ensure their people are engaged and motivated in order to deliver superior client value.

Training challenges

Training has gained a prominent role within law firms, although its degree of effectiveness is subject to many factors. Within Asia, law firms (both local and international) are certainly into the idea of training both as an engagement tool as well as a means to enhance lawyer performance and productivity. However, the way such training is approached often has a negative impact.

For example, the most common types of management training conducted by law firms are variations of business development training (such as networking skills, presentation skills and sales training). Normally this is at the behest of the senior partner, who tells either the HR or BD director “we really need to enhance our skills and profile in these areas, let’s do some sales training”.

There is no effort to measure the ROI on these programmes and very rarely are they linked to strategy execution or remuneration, yet the senior partner expects some type of magical behavioural change.

One must also feel sympathy for the trainers engaged to conduct some of this training, as three hours of watching a group of lawyers who really don’t want to be there scroll through emails on their Blackberrys can be a little disheartening.

This is typical in Asia, where senior partners’ understanding of law firm strategy and performance is fairly poor when compared to their western counterparts. Additionally, the senior partners themselves don’t believe they need to attend nor be involved in the training, since they see it as something ancillary to what the firm does and their own role. Of course, this has massive consequences, as other lawyers are more likely to model their behaviours on what seniors do.

Consequently, when client value and satisfaction is only given lip service, the ability of training or coaching to change this culture is extremely limited. The mindset of partners in Asia seems to be one of ‘let’s do something, but don’t rock the boat too much!’

Focus on high performance

This all comes down to the perception that nothing has really changed in the law firm world and that client value, efficiency, legal process outsourcing, legal project management and innovation are temporary concerns that will right themselves once the market returns to pre-financial crisis levels.

Until law firm leaders in Asia truly grasp what makes one firm stand out from another (hint: it is a high performance culture rooted in a market and knowledge orientation led through collaboration), then the value gained from training and coaching initiatives will be very limited, because they are totally disconnected from the strategy of the firm and the behaviours it intends to engender.

This puts the firm in a precarious position, as initiatives designed to create motivation and job satisfaction actually do the opposite. This has been empirically shown to have a negative impact on client satisfaction and firm profitability.

bob@srchk.com