Here’s a salutary tale. Two lawyers from the same firm were unknowingly pitching to the same prospective client. The client, in the interest of keeping legal fees low, used each lawyer’s proposal as leverage to negotiate lower fees. That’s the danger of operating in a vacuum.
However, on the other side of the coin, consider this quote from the General Counsel of a Fortune 100 company, as reported in a recent Harvard Business Review article1:
“I could find a decent tax lawyer in most firms. But when a tax lawyer successfully teamed up with an intellectual property lawyer, a regulatory lawyer, and ultimately a litigator to handle my thorniest patent issues, I knew I could never replace that whole team in another firm.”
The message is simple. Firms where the fee earners collaborate win more. In the same Harvard Business Review article it was noted that:
- As more practice groups collaborate to serve a client the average revenue from the client increases over and above what each practice would have earned from selling discrete services
- Practices that collaborate can command higher hourly rates, because cross-speciality work is less likely to be commoditised
- Cross-border work is more lucrative, because it is more complex and demanding
- Professionals who contribute to colleagues’ client work sell more, because those colleagues are more likely to refer work in return
So, if the benefits of collaboration are so great, why do firms find it difficult? In part it’s because law firms don’t have a culture of sharing. In fact, in many practices it’s quite the opposite. Promotion systems encourage rivalry between junior associates. Lawyers tend to be adversarial and reluctant to disclose information. And, in many firms, the compensation system values and rewards individual success rather than team efforts.
To collaborate effectively firms and practices need to address these issues and instil a new culture of sharing. They also need to reflect the new culture in how they structure their marketing activities.
Collaboration naturally puts a greater emphasis on recognising opportunities for cross-selling and upselling to existing clients. In turn that means moving from a focus on using marketing communications to acquire new business to developing a clear business development strategy that supports the firm’s long-term aims.
Underpinning such a business development strategy is the need for intelligence about clients that can be used to identify opportunities for expanding the business within them. And this is where a CRM really proves its value.
By providing accurate, reliable data – and making it easy for fee earners, business development teams and marketers to keep it up to date – a good CRM system provides the foundation for identifying and exploiting collaborative opportunities.
1To read the full Harvard Business Review article, entitled ‘When Senior Managers Won’t Collaborate’ by Heidi K. Gardner, please click here.