Law firm partner compensation schemes, whether lockstep or eat-what-you-kill, subjective or formulaic, open or closed, tend to share one overriding flaw: they fail to proactively and transparently define the behaviors expected of partners in order to drive such behavior. If law firm leaders want change, they need to reward it.Read More
Law firm partners should not say to clients, "We don't know what this might cost you, because every matter is different," unless it's literally the first time the firm has encountered the issue. Similarly, in-house counsel should not say to outside counsel, "We don't know what this should cost us, we're expecting you to tell us," unless this is literally the first time the business has encountered this issue. Whether buying or selling, pricing legal work requires both parties to do better.Read More
A colleague recently posted in an online legal marketing forum, seeking advice on "best practices for pitching" for an upcoming partner training. Experienced legal marketers chimed in with numerous good ideas of what to do and what not to do. This is a recurring discussion among marketing professionals, due to the large volume of pitches that every law firm produces. However, the elephant in the room is that asking for best practices for law firm pitches is like asking for the best barbecue recipes when your house is on fire. Said another way, the first best practice when it comes to pitches is to stop doing them! Nobody likes to be pitched. Clients have legal issues that slow down their business velocity. They don't have infinite time for endless streams of potential suppliers promoting magical capabilities. What they need is business partners who solve business problems. So stop doing "pitches" and instead focus on addressing your client's business needs. Let's define some terms so you can begin changing the way you think about this, and then begin changing your behavior.
A custom proposal reflects an in-depth understanding of a potential client's legal and business challenges, outlines the potential solutions, highlights the impact should the issue not be properly addressed, identifies how the law firm will tackle the issue, includes a budget and a project plan (or at least a budget and a project plan template), and identifies who will work on the matter. The proposal will describe how the firm operates, e.g., how it communicates when the scope of the matter changes, how and when it provides status reports, unless, of course, the client has a preferred method, and how and when to expect invoices. Such a custom proposal is directed to a specific contact or contacts who have confirmed both the need and the requisite budget to address the need, and have outlined the timeframe and process for making a decision. A custom proposal is 90% (or more!) about the client's business issues and how these will be addressed and 10% (at most!) about the firm. By definition, a custom proposal cannot be prepared without several in-depth conversations with multiple client stakeholders, in order to develop a robust understanding of the issues. If the firm uses an opportunity pipeline to track its partners' business development activity, a custom proposal is only generated after the opportunity has passed through several prior vetting stages, which is done by gathering a successively deeper level of knowledge about the legal and business challenges. Done right, 80% of custom proposals win the engagement.
An RFP response is a formatted and scripted document offered at the request of a potential client, often without specific confirmation of the need, the budget, the potential business impact, the decision process, or the timeframe. The content and format is 90% proscribed by the RFP template requirements and may, quite visibly or surreptitiously, reduce numerous competitive differentiators to numerical factors that allow for easy comparison of bids. An RFP response is often a surprise opportunity and is therefore not typically present on a business development opportunity pipeline before it appears in the response stage. Done right, e.g., the firm refuses to allows its partners or marketers to invest time responding to RFPs that are clearly a waste of time, 30-50% of RFP responses can be won. If a surprise RFP arrives from a key client, your winning percentage is likely to be much lower.
A pitch is a document about a law firm's capabilities, often submitted in response to a client's vague expression of a business need ("Yes, we hire litigation counsel when we have litigation"), but sometimes simply offered without a specific need in mind ("We both attended an IP event, so we assume you must hire IP lawyers"), and directed to a contact without knowledge of whether the contact can or will hire outside counsel now or in the future or, if so, at what rates. A pitch is 95% (or more!) about the firm and its immense and varied capabilities, augmented by lists of deals and cases we've done previously that loosely match the client ("Your business also makes some sort of widget!") and 5% (or less!) about the client (often just the logo on the cover page). In a business development opportunity pipeline, a pitch will often appear as the next step after an initial introduction, skipping all the intervening vetting steps, reflecting an optimistic lawyer's belief that because a potential client probably has needs, we should rush to tell them about all the things we have ever done and all that we can do. Unsolicited pitches successfully generate work less than 10-20% of the time. Frankly, the primary reason they work at all is simple probability. If you go to a singles bar on ladies night and ask every single lady to dance, you're probably going to find a dance partner. If you pitch every potential client that looks vaguely like other clients, you'll stumble on some who are both in need of outside counsel at that moment and are unsophisticated buyers. We engage in pitches because the volume of activity, for the partners and the marketers, feels like productivity, and because we don't typically measure success.
Your definitions and mileage may vary. Stop the pitches. Stop the madness. Engage your clients and potential clients in a consultative manner, and propose custom solutions that address specific business issues. You'll put forth less effort, achieve greater returns, and you won't look like everyone else.
Timothy B. Corcoran was the 2014 President of the Legal Marketing Association and is an elected Fellow of the College of Law Practice Management. He delivers keynote presentations, conducts workshops, and advises leaders of law firms, in-house legal departments and legal service providers on how to profit in a time of great change. For more information, contact him at +1.609.557.7311 or at firstname.lastname@example.org.