Winning In-house work can be very lucrative and rewarding as long term strategic partnerships bring interesting guaranteed work. However, due to the environmental conditions and poor selling behaviours that exist in the legal industry this can be very difficult. This article summarises some key learning from a training program on "winning in-house work" developed by GC's and Legal Operations professionals.
Please click on the link for course information: http://lex360.co.uk/index.php/winning-in-house-business-2/
Market conditions - the legal supplier market is crowded. New entrants like the alternative service providers (including the big 4 accountants) and technology suppliers are eroding the law firm market share. Reports from Deloitte and The Legal Executive Institute respectively indicate that 52% of firms would now be happy to buy legal services from a non-traditional law firm entity that provided a range of services and that the US ALSP market share has grown from virtually zero to $8.4 billion in just a few years. A failure to satisfy the needs of the client by harnessing the law firms trusted relationship status or being competitive means that in-house teams can source services from others that are more agile and keen to win work.
More for less challenge - pressure on legal functions to reduce legal costs in an environment where the demand and risk exposure (resulting from greater regulation) is on the increase is impacting on service delivery. Corporate functions are responding by "making more and buying less" "using legal technology" and having greater expectations of their service providers. According to a recent study, 93% of law firm leaders think it is likely that this focus on operational practice efficiency is a permanent trend.
Running the function like a business - The role of the GC has changed, historically the GC managed service delivery (capacity constraints, performance expectations management and improvements) as well as managing issues at board level. An emerging theme is the rise of the legal operations professional whose role it is to optimise delivery allowing the GC to focus on the needs of the board. As legal operations is an emerging role with little standardisation on remit or qualifications expectations vary from role to role. This creates issues for suppliers as their masters have increased and their needs are harder to manage.
Lost in translation - In any supplier – customer arrangement there are inherent conflicts that need managing. In legal services these include; law firms charging for throughput and not output, being selected on a panel but no guarantee of work and clients having expectations of collaboration with competitors. Additionally, poor buying behaviours can impact the relationship negatively as poorly scoped projects can lead to scope creep, time and cost delays.
Partnership pitfalls - law firms can be a collection of businesses (structured around practice areas) that are measured on the income they generate. These practices encourage a silo'ed mentally which impacts on firm wide revenue and service delivery.
In less progressive partnerships acquiring and implementing better ways to deliver services (be it legal process or project management or technology) can also be hindered by the behaviours and rewards that this partnership model drives.
The needs of the client - clients’ needs are like the weather; very inconsistent and differing from client to client. This makes the ability to predict client needs difficult as some prioritise pricing for example and others collaboration or innovation. Other important drivers include: technology know-how, ways of working and business law. With this vast range in drivers and differing priorities, it is virtually impossible to have one proposition for all clients and thus the need for bespoke offerings increases.
Listening to hear - Those firms who will most often see success in winning in-house business will be those that respond to clients’ needs through an effective client listening program. Understanding the needs of the client through a voice of the customer and reviewing their interactions with the firm will help law firms to understand the clients pain and value points.
Optimised sales process - Responding to tenders can be a cumbersome task that is fraught with tension. Having an End to End sales process that allows swift responses to expectations and work avoids waste (duplication of effort) and provides clarity around duties across the firm which ensures that the right people respond to the client in a coherent way. Tools like Process Maps, RACIs, PESTLEs, aligned priorities and voice of the customer/needs analysis can all increase chances of winning work.
Hunting and Farming - Typically, the law firm BD teams focus on sales by hunting (seeking new clients) instead of farming (cultivating existing relationships) this can impact on loss of revenue as "cross selling" opportunities get lost.
We can look to other markets and workplaces and see that they have also experienced these trends and changes. Not only is there best practice and insight that can be gathered from considering how these markets have responded but there is also foresight and learning to gain on what the future of sales may hold for the legal market.
About the Author
Mo Zain Ajaz is GC and Global Head of Legal Operations at National Grid. He is founder of Lex260, a consultancy driving Legal Optimisation and in 2017 he is included (Voted for) in the Hot100 Lawyers by the Lawyer Magazine. He is director for a number of National Grid companies and chair of the National Grid's employee inclusion network.
Mo Zain Ajaz holds a MBA from Warwick University and a MSc in Lean Enterprise from the University of Buckingham. for more information about LEx 360 visit LEx360.co.uk