Author: Richard G. Stock;     Lexpert     July / August 2003

Relationships between clients and their lawyers rely on a blend of reputation, competence, chemistry, cost and service. There are really very few other variables which matter, and they apply in different combinations for experienced counsel and recently called lawyers. Legal work can be generated because of a referral or from a call due to a legal business conflict in another firm, or it can be a file referred from a partner within the firm. Nothing is a sure thing.

Every month provides me with an opportunity to interview individuals who give work to lawyers. Sometimes they are CEOs, business executives, board members, city councillors, or assistant deputy ministers. Other times, they are claims officers, general counsel and other members of law departments. All of them can retain inside and outside counsel. An increasing number of corporate counsel are conducting systematic inquiries with their business units, in an effort to measure and improve their effectiveness. Even law departments don't enjoy a monopoly. Paradoxically, almost no law firms conduct regular surveys or interviews of their clients to see how they are performing as law firms, how they can improve what they offer and how to better deliver services.

Corporate and institutional "purchasers" of legal services rarely like change. But they are responsible for spending several billion dollars in legal services each year. Some of them, like insurers and banks, retain counsel on behalf of their policyholders and customers. Generally, all are very conservative - they are fussy and avoid risk. So, what should a law firm do to get any work from such a client? Or to get the client to accept a different distribution between the firms it does use? The answer is to find out what the "value proposition" is. Every client and every prospect has one, and that's what gives a law firm its competitive advantage.

There are three fundamentals that corporate counsel (for their internal clients) and law firms should spend more time acting on to ensure their work is challenging and the volumes sustainable.

Find out what the clients will focus on in the next 12 months

Too many lawyers are passive between files. They wait to be called and then scramble to deliver the best that they can. Emergency room physicians and Air Force top guns are set up with this in mind. But 90% of legal work is straightforward and not so rare that it only comes up every few years. For that reason, it tends to be service-sensitive, and only susceptible to pricing pressures when it deviates from the norm by at least 20%. By knowing what clients want before they ask for it, the firm virtually guarantees it will get the call when the file is available.

Introduce more junior lawyers and technical staff to the client

Senior counsel working in institutional settings, as well as those who maintain a strong working relationship with partners in law firms are having second thoughts about the cost of legal services. They find that the value from senior partners is usually acceptable at any price. Still, they always talk about the lack of delegation to associates and to paralegal / technical staff. Despite the mantra that clients select the lawyers and not the firm, the client intends this to refer to the relationship. Clients are reasonable. Even though the partner is not expected to do every hour on the file, law firms fail to push 20% to 40% of the tasks in a file off the partners' credenza into the hands of associates and paralegal staff.

Report your achievements to your clients

One of the most impressive credentials for a professional is to do "good work". What good is expertise if no one knows about it? Corporate and institutional clients typically have diffused practices for retaining counsel for specific files. There can be a considerable number of professionals and management within an organization who can cause legal work to be performed. Some use preferred lists, while others have more informal arrangements. It is rare to find that a single firm will provide the full range (corporate, commercial, labour, tax, litigation) of legal services in every part of the country. Similarly, a law department may be inclined to use local counsel for work in jurisdictions outside its catchment area. Both would do well to prepare and present comprehensive listings of chargeable and non-chargeable services offered to the organization twice each year, and at the same time identify who the internal client was. Finally, law firms should describe the services that have been offered to similar clients in the same industry, which would be of interest.

Our interview findings underscore what may appear to be obvious - the clients are busy and often choose counsel based on recent successful experience or contact. Maintain visibility by any means, at least every two months.