Driving change: How to develop a genuine client focus

Business has changed in the past few years and volatility is now the norm. It is not just that the road is bumpy, but that the land has shifted underneath the road in ways that have changed its direction. The economy is not necessarily in recovery, but may just be in the new normality. Law firms and their clients have to accept that altered economic conditions have become a daily reality.

Of course, being able to adapt to these changes has become key to the success of any business and there is no room for complacency – adjusting the tyre pressure and hoping that will be enough is misguided: it requires a reassessment from the chassis up.

Deciding the starting point for addressing change is always a challenge, but there is one overwhelming ‘polar north’ that should direct thinking, and that is the fast-changing needs and demands of clients. It’s around this that law firms should adapt their design and consider the suitability of their current business ‘vehicle’.

It is the classic ‘what keeps clients awake at night’ question that defines the starting point. While one of the root causes of business underperformance can currently be traced back to a stagnating economy, these issues are not really the problems that keep clients awake at night.

Rather than the abstract macro issues, clients are concerned about the daily realities of running a business. Like us, clients are less likely to lose sleep over a percentage decline in China’s GDP than they are to lose it over how new regulatory pressures and protectionism can be managed.

Even closer to home, they have to constantly think about how to demonstrate the value of their department at the board meeting next week or how they can implement cost-saving measures and still improve the quality of services, or how to speed up the legal element of complex transactions to gain a competitive advantage.

If you buy into the defining importance of client needs and demands being the absolute priority criteria for change within law firms, then there are some considerations that are worth more than ?a passing thought.

Focus on culture

Culture is critical to the success of any business, in any market. The legal profession is no different; one could argue that those of us in the UK must go further to address our clients’ needs given that we have, until recently, operated in a closed legal market. A client-centric culture now needs to be implemented to ensure we remain competitive.

To achieve a client-centric culture, everything must flow from the top, with support from senior management being crucial for success. Open communication, listening to clients and implementing change all play an important part in successfully meeting client’s needs.

It is not an instant fix. It takes new habits ingrained at a daily level and structural shifts that takes time to implement. Real change will take three to five years. Given these barriers to entry, those that start early will steal a real ?march on others.

Our firm is known for embracing change and has had some very tangible outputs over the past few years such as Managed Legal Service (MLS) and Lawyers on Demand (LOD). Both services continue to grow, providing proof of a gap in the market made possible by an open market and changing client needs. A culture of innovation and embracing change does much to help navigate changes in this sector and to service ?future client needs.

Equally, actually implementing innovations equips lawyers with the skills required to guide clients through their own challenges. Clients are much more likely to listen to advice from a firm that is adapting well in its own market and successfully innovating to meet altered market circumstances.

These days, our attitude should not be ‘this is how it has always been done’, but rather ‘how can we make this better?’ Open discussion, clear shared goals, constant reappraisal of old habits and sometimes bringing in new thinking and people also helps. Adopting and translating this approach into the firm’s culture is a huge task but, ultimately, will ensure both our own business and that ?of our clients will thrive.

Encourage innovation

These days, clients demand more for less; they need the same high level of quality on a greater volume of work at a reduced cost, and firms that cannot meet this challenge will fall by the wayside in the short term. In the longer term, those only focusing on the reduced cost element ?will also struggle.

Clients are collectively craving innovation, more so now than ever before. Cost pressures are of course at the forefront of everyone’s mind, but that does not mean that clients’ real business wmomentum will come from this.

Business success comes from opening in new markets, doing major deals, structuring new approaches and launching new products. Offering legal services that support these objectives while addressing costs are really where the challenge lies.

There are lots of ways to encourage innovation and several law firms have established innovation teams, kaisen-type suggestion and award schemes, and partnerships with academic institutions.

Recognising what sort of culture your firm currently has and having a clear goal for change are what will define the right initiatives for your firm. At a macro level, clients will begin to see change is really happening only when it is law firms rather than them that are driving change.

Cross the divide

Putting oneself in the position of the client allows you to address their key concerns. This is easy to say and often difficult to do. There are a number of activities that can help you to truly integrate your business with that of your client.

A solid sector programme, allowing staff to immerse themselves in a market, is a good place to start. Client research constantly shows that the thing they score the highest is a firm’s ability to understand their business.

Concentrating on sectors means a firm will gain the ability to share market information to the advantage of everyone’s clients. A good sector programme should include a resource dedicated to business analysis, a culture of free-flowing information and knowledge sharing ?across the firm.

Seminars and thought leadership are good, but nothing counts in the long term like the ability of a firm’s team to demonstrate, day in and day out, that ?they understand their client’s sector ?and business.

Listen to clients

When considering the future evolution of legal services, we must listen to those who drive demand. Feedback from clients should be at the centre of every successful law firm’s strategy – even if the feedback is not what we’d like to hear.

Looking across the divide, understanding can be a challenge in itself, following which we must face implementation of change to address the new client needs that have been identified. Change can often be difficult to implement, particularly if it goes against your culture or how the firm is structured, as often the best ideas involve a radical shift in thinking.

Implementation of formal client review structures, regular audits, acquiring post-pitch feedback and quarterly reviews with clients will all ensure we hear clients and address their needs and concerns. Ultimately, if we don’t listen to clients, they will eventually take their business to those who will.

And, if you think all of the above is a truism, then the fact that only around 12 per cent of law firm clients in the UK are regularly asked for post-matter feedback on performance should reinforce why it is worth saying again.

These days, we may feel more in control than in 2008, but this does not mean that the market conditions are any easier. The challenge to differentiate ?when it comes to client services has ?never been greater.

Fortunately, for the brave and the first movers, this means that there is a real opportunity to grow and build reputations. The ultimate measure (apart from financials) of whether a law firm makes it will be what its clients say about it. There was never a more important time to listen.

Plan to evolve

It is not the strongest who survive, but rather the fastest evolving. Judging from client feedback, it’s safe to say that they are still pushing for change. The general consensus is that legal services as a whole will need to evolve even faster.

We have seen concessions to the evolution of legal services, with firms moving from just the traditional hourly billing model to include alternative fee arrangements. The continued drive to ?cut costs will eventually see basic legal work move to outsourcing, north-sourcing and virtualisation.

But, these are the early foothills of change. In time, as more law firms adapt, we’ll see faster and more innovative solutions to meet the needs of clients.

A real commitment to a client-facing culture will speed up the entire process. This, alongside CRM programmes, training, a commitment to innovation, a focus on sectors, constantly seeking client feedback and an open discursive culture, are the building blocks for a firm leading change on behalf of its clients.

A vision for what the firm wants to deliver to clients and a clear set of goals are the architecture that gives the blocks structure. Former US president Dwight Eisenhower once said “plans are nothing; planning is everything”. Most law firms now have business plans, but how many are constantly reviewing them in this context and through the lens of client needs?

 

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Ensuring your firm has a genuine client focus

• First and foremost, it’s about culture. Is yours client centric?

• Innovation is the name of the game – how deep does it run in your firm?

• Have you crossed the divide yet – do you understand your clients?

• Is your business plan flexible and does it get reviewed regularly?

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Ash Coleman-Smith is the marketing director at international law firm Berwin Leighton Paisner (www.blplaw.com)

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