Archive for the ‘ Clients ’ Category

You had me at “the billable hour is directly opposed to the best interest of the client …”

Mark this day down on your calendars, kids. We will one day look back on November 18, 2014, as the first day in the long anticipated end to the dreaded billable hour.

From today’s American Lawyer:

Law firms have been calling for the end of the billable hour for decades. And since the 2008 recession, they have increasingly offered cost-conscious clients alternative fee arrangements.

Now Jackson Lewis says it wants to take the next step in the evolutionary process of alternative fee arrangements by eliminating the billable hour as an evaluative tool for its 293 associates. As of Jan. 1, associates at the labor and employment firm will be assessed on efficiency, client service, responsiveness, team-orientation and pro-bono commitment in an effort to align the way Jackson Lewis “deliver[s] legal services with clients’ needs,” according to firm chair Vincent Cino. (The firm’s compensation model for partners is based on revenue rather than hours.)

“The billable hour is directly opposed to the best interest of the client and to the provider of service because by its very nature it adds an artificial barrier to the accomplishment of the only real objective, which is a quality legal product for a set and expected price,” Cino says.

Whether you agree or not that the “billable hour is directly opposed to the best interest of the client” you have had to wonder, at some point in your career, “Well, how did we get here?”

Continue reading

Can a law firm exist without clients? 49% of new partners surveyed think so.

I’m reading a new survey from ALM, New Partners Ambivalent About Rainmaking, Survey Finds, and am aghast at the naïveté of the respondents. Apparently, 49% of new partners surveyed don’t think that their ability to make rain is a deciding factor in their being promoted to partner (equity or non-equity).

Asked how important they think certain factors were in their promotion, 84.4 percent of respondents said they believe they were promoted according to their ability to perform first-class legal work, and 60 percent cited the strength of their commitment to the firm. (Respondents were allowed to choose more than one answer.) Just under half—49 percent—of new partners said that their ability to bring in new clients was an important factor in their promotion, although equity partners saw developing clients of their own as somewhat more important than nonequity partners did.

“Associates are not adequately aware that they effectively need their own book of business of approximately $750,000 to $1 million to be a partner at a large law firm,” one respondent wrote in the survey. “Even if an associate is promoted, they are destined to be unsuccessful as a partner without this size of a book.”

Wow. Without clients, you know the people who write big checks to the firm, there is no firm. Clients do not appear out of nothing. Those relationships have to be developed over time, years actually, then maintained and hopefully built. Institutional clients no longer exist. You cannot make partner and expect — poof! — originating credits miraculously appear.

And to the 84% who think the ability to do first-class legal work is what got you promoted, let me clue you in on something: The ability to do first-class work is stipulated; you would have been fired years before if you could not do so.

And while business development might not be the most comfortable of tasks for an individual, it is very important to a firm that their equity partners bring in new business. A law firm cannot exist on service partners alone (unless you hire a Pete).

Business development (sales) is not a talent many of us are born with, but it can be learned and developed over time for many (not all). But it first must be engrained into the culture of the firm. Too many firms do not support business development, but expect the results. There is no training or coaching to learn the skills necessary to accomplish the tasks. There are no rewards, in the form of hourly requirement credits, for business development. Too often the hurdles to get approval become insurmountable, and I haven’t even touched on the compensation system.

How timely that Dave Bruns and I will be presenting next week at the ALM West Coast Law Firm Marketing & Business Development Leadership Forum in San Francisco: The Total Package: Business Development Integration for Success. This is a topic that is near and dear to the business development teams across the country, and we hope to discuss what firms need to do to support the success of their business development programs.

 

I’m hiring a law firm. Oy!

In my 20s I received a great piece of dating advice: Don’t answer the door on a first date wearing a wedding dress.

I would say similar advice applies to lawyers: Don’t show up for the first meeting with a potential client carrying a proposal and an engagement letter.

I am in the process of looking for a very specialized law firm to handle a very specialized matter for a specific type of business. I am the new president of my HOA, which is a stock corporation (coop), not a condominium. Our issues are different, as are the legal requirements set by the state, to be reflected in our governing documents.

I thought my email inquiry was clear: “Do you work with Stock Cooperative HOAs? We are looking for a firm to handle the updating and revising of all of our governing documents.

The reply back within hours from the administrative assistant included 1,818 words in the reply (that’s four full pages if you’re wondering), along with two attachments.

Wow. Holy boiler-plate.

I was looking for a yes or no answer and I got a whole crap load of copy-paste gunk, a 21-page proposal misidentifying our type of association as well as our governing documents, along with a 7-page fee agreement and engagement letter “signed” by one of the name partners. However, the did customize our association’s name on the cover of the proposal.

Sadly, my simple question was never really answered: Do you represent businesses like mine? The admin said yes, but their marketing materials don’t lead me to believe that is true.

If we were on a first date I would have been tempted to excuse myself to use the restroom and just keep on going out the back door.

Considering the admin didn’t even got my name right, my first inclination is to pass on the firm, even though they are considered one of the top in the field. That or send the admin an invitation to the next LMA-LA event so she can learn how to properly market her firm.

But I’ll speak with an attorney first before I pass on the firm. Bad legal marketing shouldn’t stand in the way of good legal work. Let’s face it, not everyone can be a legal marketer extraordinaire.

Exceptions don’t make the rule. The business model is broken.

2372626568_63f6b8c069_oGreat debate starting to take place in the legal marketing/business of law world.

Is the business model broken?

At the Legal Marketing Association‘s annual conference, I attended a moderated roundtable discussion on Disruptive Legal Trends. While it began as a discussion of the Axioms of the world, the conversation quickly shifted to the business model itself. The summary of that session, along with the Big Data session, can be found in LMA Think Tank Live Summary prepared by Shift Central.

I was in the room when Toby Brown spoke his now immortal words, summarized in his post, The Business Model is Not Broken, and he is right, all eyes in the room “turned and gave me [him] the ‘who farted’ look.”

I must admit, I am one who believes that the model, in general, is broken. And while there are exceptions out there, such as Toby’s firm, Akin Gump, who are leaders in the change management, there are too many firms out there refusing to evolve.

The leverage pyramid of partner to associate is gone. The billable hour is losing popularity and faith. Alternative fees are not discounts at $1 million billed.  And merger to grow (or survive) is not a strategy.

Clients are more and more in tune with cost and price to value propositions, and lawyers, the service provider, need to evolve and meet their clients on their plane (and I am not talking the kind with first class seating to be billed out as a necessary expense).

I have heard attorneys say, when presented with new processes and procedures that will save time, “Don’t they know how I make my money?”

And that’s what’s broken. The profession of law has evolved into the business of law and not all lawyers and law firms have drunk the Kool-aid and evolved.

Firms and attorneys that truly understand the nuance between profession and business will survive. Those that don’t will fade away. Sadly, most of those firms will fade away with little fanfare.

Toby and I are not really at odds. We’re just looking at the same thing, yet our perceptions are skewed by our vantage points. He is at Big Law that is doing it right, while I am at a regional, mid-sized firm that is evolving. The conversations we have with our peers are different, because our peers are different.

Our firms are lucky. They are the exceptions. Their legal professionals are in the middle of the conversations surrounding this evolution, and helping to reshape the cultural and business model within our firms. But what about the rest?

The Patton Boggs and Orricks (are they next???) of the AmLaw 100 world get lots of press as they search for a merger partner, yet annually there are dozens of other firms of local prominence across the country that are acquired by big law with little more than a press release, or fail on their own and quietly close their doors.

As I said in the Think Tank, on the smaller platforms it is hard to hide a failing business model. It is readily apparent what is working and where things are not, and merger as a strategy, in and of itself, will not help a firm to survive. It just puts off the inevitable.

It’s a very interesting conversation and one that will continue.

Photo credit: Amanda Hatfield on Flickr

Controversial Clients and Social Media: The Donald Sterling Edition

As an LA Clippers fan, I am disheartened and disgusted by Donald Sterling, his wife, and everyone associated with the franchise who have stood by and co-signed this racist crap.

However, just as his wife is currently being represented by counsel in her attempt to retain her ownership of the team, Donald Sterling deserves the same, controversial or not.

Yet, in our social media warfare world, TMZ is reporting that eight major law firms have rejected his attempts to retain counsel. Donald Sterling is “radioactive.”

Our sources say partners in the firms feel representing Sterling would alienate both their African American clients and corporate clients that are hyper-sensitive to controversy.

One source closely connected with Sterling tells TMZ … it’s especially galling for the Clippers owner, because a number of partners in these firms have called him from time to time asking for favors, including tickets to games.

They are reporting major firms in Los Angeles and San Francisco, which brings to mind several AmLaw 100 firms who are not shy or meek when it comes to their client base.

I am sad to say this, but I told yo so.

Controversial Clients and Social Media: Game Changer?

Photo credit: “The Controversial Topics of Wikipedia” on Wired.com

An interesting headline caught my eye this week via Forbes: “Disgusting!,” Cry Legal Experts: Is This The Lowest A Top U.S. Law Firm Has Ever Stoop (ht Above the Law).

Quick history lesson: During WWII the Japanese (allegedly) kidnapped (mostly) Korean women and forced them to be “comfort women” (prostitutes).

The case in question involves a U.S. law firm taking on a controversial action surrounding this issue:

Would any self-respecting U.S. law firm represent a client who suggested the Jews deserved the Holocaust? Probably not. As a matter of honor, most law firms would run a mile, and even the least honorable would conclude that the damage to their reputation wasn’t worth it.

Where imperial Japan’s atrocities are concerned, however, at least one top U.S. law firm hasn’t been so choosy. In what is surely one of the most controversial civil suits ever filed in the United States, the Los Angeles office of Chicago-based Mayer Brown is trying to prove that the so-called comfort women – the sex slaves used by the Imperial Japanese Army in World War II – were no more than common prostitutes.

Not exactly the way I’d like a story on my firm, in Forbes, to begin.

So why am I writing this post?

Call it what you will — a game changer, jumping the shark, yellow journalism, link bait — but something has shifted in the land of corporate communications and management with the advancement of social media.

While law firms like to hold themselves out to be above the fray (we’re a “profession” after all), truth is, we bleed green just like any other business and are susceptible to outside influences.

Earlier this month, the co-founder and CEO of Mozilla was forced to resign due to a relatively small political contribution he personally made to a now unpopular California state proposition.

Prior to the contribution being revealed — several years after the fact — there was no indication that his contribution ever impacted the running of the business, or the management of the employees.

But his personal position is now incredibly unpopular and political forces used social media to put pressure on the company once the contribution was unburied, and he resigned.

Then I saw the Forbes headline this week. And read the comments. And started a discussion. And listened to the debate. And I have one question that cannot be answered … yet:

What does this mean for law firms that take on unpopular or controversial clients or causes?

Continue reading

Session Recap: Generational Marketing (video)

Thanks to the folks at Spark Media Solutions for doing a great round of post-session interviews after our presentation, Generational Marketing: Strategies and tactics for engagement with Boomers, Gen Xers and Millennials.They really picked up on the main themes of our session, and provides a great recap of our session.

Jonathan Fitzgarrald and I appreciate the feedback we received, and look forward to presenting next week in Orlando at the Legal Marketing Association’s annual conference.

Follow

Get every new post delivered to your Inbox.

Join 4,471 other followers

%d bloggers like this: