A survey from LexisNexis showed that one of the top challenges in winning new business is obtaining lawyer participation in the business development process. By wisely choosing appropriate metrics, business development and marketing professionals can overcome this challenge, get better participation from lawyers, and obtain improved financial outcomes.
The same LexisNexis survey identified that the metrics that law firm marketing departments are most frequently tracking for business development fall into two categories. The first type were marketing metrics, which help measure success in filling the top of the “sales funnel.” Number of leads and lead source are examples of these. The second type were lagging indicators for true business development or sales. These are the outputs of the business development process and would include new revenue and win/loss data.
These marketing metrics and lagging indicators, however, do not provide sufficient focus on the lawyer actions necessary for effective business development. To change lawyer behaviour, the most effective metrics are business development leading indicators.
Lagging indicators, which are important in that they measure the ultimate results, are hard to improve upon unless you have a handle on your leading indicators. Focusing on leading indicators helps you identify the business development activities and metrics that will lead to the desired financial outcomes.
The following are three tips for using leading indicators to drive lawyer business development participation and effectiveness.
- Choose metrics based on lawyer career stage – Realistic objectives for a senior associate should be different than the goals for a rain-making partner. Depending on the business development maturity of a lawyer, reasonable metrics might include any of the following:
- Hours spent on BD activities
- # of interactions with targeted clients/prospects
- # of times speaking at appropriate conferences
- Don’t be afraid of subjective measurements – For measuring the ROI of marketing activities, you want to make sure you have objective metrics in place. On the other hand, when you are focused on encouraging lawyers to better participate in the business development process, subjective measures can be effective. Mo Bunnell, Founder & President of Bunnell Idea Group (BIG), says to "measure the right thing subjectively rather than the wrong thing accurately. This is particularly important for behavioral change."
- Review for accountability – The benefit of tracking lagging indicators is that it helps create checkpoints to make sure the lawyers are taking the necessary actions to achieve their goals. Having a regularly scheduled meeting with a practice lead or business development professional puts the lawyers on the spot for executing their committed business development tasks. With each meeting, identify the steps that have to be achieved before the next meeting. Mo Bunnell recommends that then "the lawyer can measure whether or not they did these things. We find a monthly deadline for measurement works really well in law. Publicly displaying results for members of a team provides an additional powerful incentive."
A primary benefit of leading indicators is that they are completely within the control of the lawyers to achieve. Identify and measure the right leading indicators for your firm, and you will be successful in changing lawyer behaviors to improve business development outcomes.