Today there are at least two major factors that threaten a law firm’s economic health.
First, sophisticated in-house counsel are increasingly more knowledgeable about the business of law and thus are more demanding of, and less loyal to the law firms they hire. Second, the active lateral market presents partners with lucrative opportunities to jump firms and take their clients with them.
So, what can a law firm do to shore up both partner and client retention? Implement a high-performing Key Client Program. Done well, the initiative can institutionalize client relationships, spur organic growth and increase profitability — all of which provide a strong incentive for partners to stay.
But what makes for a high-performing Key Client Program? There are a number of factors that are critical: entrepreneurial leadership, robust collaboration and value creation.
The success of a Key Client Program in no small part depends on its leaders. The program’s leader must be client-centric and opportunity driven — the mindset of a successful entrepreneur. This role requires the individual to drive a laser-focus effort on knowing each key client — the company, its industry and its people. The shift from lawyer or relationship partner to “entrepreneur” is profound, but it’s what is required in today’s market. It’s necessary to create an environment in which everyone involved is looking for innovative solutions rooted in the clients’ actual needs.
Robust collaboration requires face-to-face communication among more than just lawyers, or the “usual suspects.” Increasingly, sophisticated clients are adding non-lawyer professionals to their legal departments with expertise in areas such as operations and pricing. These new suspects are influential in defining what constitutes excellence in the delivery of legal services in the client’s eyes. Knowing them is part of knowing the client and understanding its needs and wants.
A high-performing program consistently demonstrates value. The pricing options it offers reflect that clients increasingly segment and value extraordinary or “bet-the-company” work, trusted advisor work, and routine work differently. The varied pricing options for each category demonstrate that the firm’s internal processes can consistently produce high-quality outcomes at a well-managed, predictable cost no matter the work. The law firm’s staffing models, project management processes and knowledge management techniques provide this assurance.
It’s A Win-Win
The beauty of a high-performing Key Client Program is that it tangibly demonstrates a firm’s client focus is more than marketing sweet-talk. That makes clients happy.
In return, the firm is happy because the program provides a unique platform to build the trust and allegiance of clients. That, in turn, translates to not just more work but more profitable, higher-end work.
A Key Client Program creates a true point of competitive advantage for a law firm that, in my experience, has proven to be a significant contributor to organic growth. Such growth has also proven to bolster partner retention, which is an important benefit.