Law firm management – what are the yardsticks against which I can measure the success of my strategy
Updated: Aug 14, 2020
Before I start to derive a strategy for the law firm from my vision, it must be clear what demands I place on my strategy. How do I want to measure whether the strategy is indeed leading me towards a clear positioning in the market which provides me with uniqueness and makes me attractive in my clients’ perception?
This metric for my strategy can be expressed through the following questions:
(1) Does the strategy contribute to an increase in the value of my law firm? The value-boosting effect of a strategy tangibly manifests itself in an increase in partner income. At least in the medium term, a strategy will have to fulfil this promise.
(2) Does the strategy provide us with a competitive edge in at least one relevant point? This advantage may be reflected in a more favourable price for our clients or in better quality in comparison with the competition. The latter may mean that our legal advice is based on superior expertise or that the components of our services outclass those of our competitors. It may also consist of a particularly high degree of familiarity with a certain industry or in our law firm’s stronger attraction for young talents. In the recent past, we can also see an increasing number of law firms which score by surpassing their competitors in technological terms. As a rule, clients profit from this through better prices, faster completion of the mandate and frequently also a higher degree of quality.
(3) Do our strong points come into their own in the strategy we have chosen? A strategy should never be limited to a negative formulation (such as “We want to eliminate our weakness with regard to expertise in inheritance law.”). It has to enhance the law firm’s existing strengths in order to generate momentum and advance the development of the law firm.
(4) Does the strategy provide us with a profile which is sufficiently distinct to make us clearly visible in the market? Formulations of the definitions of the service portfolio, the customer segment, the market sector and the distribution channels must be clear-cut. Deviations from these formulations in day-to-day business result in our profile being eroded and in a dilution of our market position.
(5) Do our clients, too, rate our chosen strategy valuable and attractive? A strategy is only good if it leads to a higher degree of client satisfaction. This can be measured by means of sporadic enquiries among clients with whom you have a close relationship.
Right, there we have our yardsticks! What we have to do now is to work out a strategy which satisfies these requirements. This is hard, back-breaking work! But more about this is my next blog post.
This blog was originally published on 6 November 2018 in Vista, the online magazine of the Executive School, University of St.Gallen, Switzerland.
About the Author Prof. Dr. Leo Staub is a Titular Professor of Business Law and Legal Management at the University of St. Gallen. He also is one of the Directors of the Executive School of Management, Technology and Law of St. Gallen University where he chairs the division “Law & Management”. Leo can be reached at email@example.com