Is Asking Clients for Feedback a Sign of Weakness?

Sadly, many professionals think it is! Perhaps they believe that clients will think you lack confidence, or awareness.

But I think this view is sorely mistaken.

Imagine this situation: you have halfway through your first piece of work with an important client. The enlightened leader will have the view that it will be important to know if the team are delivering on all fronts:

  • Are we responsive?
  • Giving you regular updates on progress?
  • Commercial advice?

In no way is this saying you are lacking confidence. If delivered with a strong demeanour, it’s saying this,

 ‘We know we are good. We know all clients are different and have different service requirements. We are dedicated to client service and will pull out all the stops to ensure we deliver on those. So please tell us…’

With markets becoming increasingly competitive, I believe that adopting such an approach will reap dividends. It’s such an easy way to provide evidence that you really do care about client service.

Just don’t do it all the time! That’s potentially irritating and could show a lack of confidence!

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Improving Margins in a Downturn for Professional Service Firms

COVID-19 is bound to be affecting workflows and margins.  Here’s a programme of activities to address this. Some are strategic and fundamental and others are tactical and operational.

These are the questions that need to be answered together with the steps that can be taken and the output from these actions:

  1. Are you doing the right kind of work? To answer this, review your financial data on profitability by work type.
  1. Are you doing the right kind of work, for the right clients? Review your financial data on profitability by client

The output from addressing these first two questions should help you generate a strategy for finding and delivering profitable work. You might decide to drop certain clients that are draining your profits. You may decide to focus on certain legal services and drop others.

  1. Are your partners selling the value of the work well (eg benefits to clients, risks mitigated etc)?To answer this I recommend analysing your financial data on profitability by lead person and I would talk to individuals to assess their approach. I have found wide variances in profitability in the same practice area.

The output from this analysis could be a best practice guide. Also training workshops could be offered on selling skills.

  1. Are your partners pricing the work properly? To answer this, I would talk to partners and review engagement letters

The output from this review could be a pricing manual showing how much this work has cost before. I also recommend brainstorming some creative pricing propositions. Again a training workshop could be devised to skill up key team members.

  1. Are your partners negotiating well at the outset and renegotiating if events cause the scope to change (eg review all leases rather than a sample etc)? To find this out, I would talk to the partners to assess the need. The output would be a training workshop to develop skills. 
  1. Are your partners managing the work efficiently? This requires a review of how the work has been resourced and I would talk to partners and associates. I find that the associates tend to be good at revealing what inefficiencies there are in the day-to-day activities.

The final output would be an improved matter management toolkit.

This may seem like a lot of work. To be honest, it is! Trusted outside consultants can help. They should be seen as objective and have no hidden agendas. The truth is that, given the drastic downturn in the economy, drastic actions may be needed.

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How to Price Your Legal Services

In the old days we weighed the files to gauge the price.

Then accountants were hired by law firms – timesheets were introduced and the majority of lawyers charged on the basis of time spent. This easily leads to over-charging because firms get paid for any inefficiencies, or under-charging where the client would have been happy to pay more.

Timesheets are good for management information (ie how much time was spent), but not good for pricing decisions.

To help you judge an appropriate fee level, here are some clues as to whether work should be given premium pricing or discounted.

Premium pricing clues 

  • Urgency of work to the client – if you need to work people through the night or weekends or bring them back from training courses, most clients would accept that it might cost more
  • Importance of work to the client (what Americans call ‘you-bet-your-ranch’ work) – if the benefits or risks inherent in the matter are greater than normal, most clients would accept that it might cost more. Sometimes the work is urgent and important!
  • Expected savings to the client (tax work in particular can provide such savings) – makes it easier for clients to pay more
  • The dominance of the firm in the category of work – where your firm has the established brand name, or a distinctive way of delivering the service
  • Successful previous experience with the firm – the client will find it less stressful to work with you and their boss won’t be surprised at the selection
  • Low level of competition for the work – for whatever reason
  • Low level of experience working with lawyers – the more experienced buyers can drive a harder bargain

Discounted pricing clues

  • High level of competition (eg beauty parade) – though clients don’t always choose the cheapest.
  • Fixed client budget – though there are ways of dealing with this, such as staged payments
  • General market expectation from experience of similar work – so it will help to make clear where your contribution is not equivalent to similar work in the market
  • Lack of realisation in the client’s mind as to the value of the work – this occurs where the lawyer has failed to explain the benefits and risks inherent in the matter
  • High level of experience working with lawyers – or really good buyers, such as Procurement functions
  • On-going relationship (eg Key Account) – there may be a volume discount or you are fearful of letting a rival firm start to work for them

I urge firms not to be slaves to timesheets and think about flexing their pricing depending on circumstances.

 

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Matter Management Matters – Improving Quality and Efficiency

I’ve delivered dozens of workshops on this topic and always get the same reaction to the question ‘Who is responsible for what aspects of a matter?’ There are blank faces, because there is typically no clear answer.

The implications of this lack of clarity are significant:

  • There are bound to be some overlaps – which mean that some tasks will be duplicated, either leading to clients being over-charged or margins being squeezed if the time is written off
  • There will probably be some underlaps – where we might hear ‘I thought you were doing that!’. If this happens, it risks having an unnecessary delay in progress and potentially compromises work quality

So it’s clear to me that we need clearer roles for matter management purposes. Here’s my default list of roles for Matter Partners and Matter Associates.

Role for Matter Partners

  • Assemble an appropriate team and select an associate to be Matter Associate
  • Generate a project plan, with assigned tasks and deadlines and keep this updated
  • Provide leadership and supervision
  • Agree fee estimate with client, issue invoices, and collect cash
  • Agree principal point of contact with client
  • Debrief team upon completion
  • Capture and disseminate useful knowhow
  • Undertake a client satisfaction review

Role for Matter Associate

  • Assist the Matter Partner in fulfilling their responsibilities (see above)
  • Produce and maintain a list of documents and key issues
  • Take responsibility for the day-to-day communication within the team and with any external parties (surveyors etc)
  • Arrange regular team meetings
  • Ensure all deadlines are met
  • Monitor costs of the matter against the original estimate and brief the Matter Partner regularly
  • Arrange the completion meeting, preparing the agenda and post completion steps

Looks like there are a lot of key tasks for the Mid-level or Senior Associate.

Most firms will benefit from having greater clarity on matter management roles. If Associates are ever unclear, I highly recommend that you suggest roles for yourself or at least ask the Matter Partner. The potential implications if you don’t are serious!

Have I missed out any key roles? Or assigned them wrongly?

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Research Findings on What Motivates (and Demotivates) Lawyers

Source: pinterest

Lockdown is clearly leading to motivation at work issues. I’ve asked more than a thousand lawyers over the last ten years what motivates them at work. To what extent is it a high salary? Or is it status, congeniality, security, achievement, recognition, autonomy, responsibility?

The results are somewhat consistent and perhaps not surprising. What is surprising is the extent to which their supervisors are behaving in ways that demotivate them!

What Motivates Lawyers

A minority claim that what motivates them is a high salary or bonus. US lawyers have money as a higher priority – maybe because of the high cost of their legal education.

But the vast majority confirm that the main motivators relate to the work itself. It’s receiving challenging work that provides a sense of responsibility, autonomy and ultimately achievement. And it’s being appreciated and recognised for their contribution

What Demotivates Lawyers

A surprising number of lawyers say they are not given stretching work. Their workload seems trivial and mundane. They also say that they don’t feel valued or appreciated.

I receive comments that there seems to be an unequal allocation of work and they sense others are not pulling their weight.

Other aspects that demotivate lawyers are:

  • Not receiving any constructive feedback
  • Others taking the credit for your work
  • Inefficient matter management
  • Poor work-life balance
  • Supervisors who are overly nit-picky

Advice to Supervisors

  1. Try finding out what motivates and demotivates junior lawyers in your team. Ask what matters they’ve enjoyed most and least.
  2. Consider more carefully what stretching work you can delegate. Try to avoid the view that ‘it’s easier to do it myself!’
  3. Delegate thoroughly so juniors know how best to carry out the work. This minimises the risks of work needing to be redone.
  4. Give constructive feedback so junior lawyers can learn. This is particularly important for Millennials.
  5. Say ‘well done’ more often. And make these real by being specific about what was good.

Remember, all your new hires almost certainly started off very motivated to be great lawyers. Let’s try to keep it that way!

It’s more challenging motivating team members during lockdown. Let’s get better at it!

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Marketing and Compelling StoryTelling

All of us construct narratives about ourselves – where we come from, what we do, where we are going. The kinds of stories we tell make a big difference to how confident we are marketing ourselves and our products or services.

Classic powerful stories from Antigone to Casablanca to Star Wars to Harry Potter have been analysed and found to contain the same basic five elements, as follows:

  1. A protagonist the listener cares about. We must be able to relate to the situation or struggles of a particular person or group.
  1. A catalyst compelling the protagonist to take action. An event takes place and something important is at stake. Typically, the first act of a play or section of a novel is devoted to establishing this fact. It’s up to the protagonist to put things right again.
  1. Trials and tribulations. The story’s second act commences as obstacles, produce frustration, conflict and drama, and often lead the protagonist to change in an essential way. As in The Odyssey, the trials reveal, test, and shape the protagonist’s character. Time is spent wandering metaphorically in the wilderness, far from home.
  1. A turning point. This represents a point of no return, which closes the second act. The protagonist can no longer see or do things the same way as before.
  1. A resolution. This is the third act, in which the protagonist either succeeds magnificently or fails tragically.

This is the classic beginning-middle-end story structure defined by Aristotle more than 2,300 years ago and used by countless others since. It seems to reflect how the human mind wants to organise reality.

Do you have a coherent and compelling story about yourself? What about your firm – what’s that story?

Source: Herminia Ibarra & Kent Lineback in HBR Jan 2005

See also: https://tonyreiss.com/2013/04/10/elevator-pitching-the-wow-how-now-approach/

 

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The World Needs Better Facilitation for Online Group Meetings

The Zoom or Team calls don’t have to be so unengaging, rambling and ineffective. You just need a good facilitator. And what specifically would such a person bring? Here are some benefits.

  1. Someone to take a little time out to connect personally with everyone on the call. OK, this might not be possible with 300 people but there might be a couple of people in a large group to draw attention to, for example, birthdays or someone who is back having been sick. A good facilitator thinks a bit more about people and ways of engaging with them.
  2. They would stipulate upfront the purpose of the virtual gathering, the agenda and timing and get buy-in to that. It’s hard to stay focused when you’re not sure what’s going on.
  3. A facilitator is not a dictator! They might make a proposal. They might suggest. They might consult. It depends on the group. It might be appropriate to ask, ‘Does anyone have anything to add to the agenda?’ or just ‘Is everyone OK with that?’.
  4. A good facilitator will have considered suitable processes for conducting the agenda items. Depending on whether they want a discussion, a decision or some creative ideas, there are appropriate processes for each. And there are some great ones out there. Have you tried Thinking Rounds? This is a perfect process if you want to avoid the senior people or extraverts dominating the discussion.
  5. They will be good listeners – probing interesting comments to find out what’s below the waterline and not being said explicitly.
  6. Facilitators find ways to build consensus – again, using appropriate processes such as agreeing a list of suitable criteria and carrying out an assessment of risks and rewards.
  7. They will ensure clarity on next steps. Who is to do what, by when? This will be essential for following up at the next meeting. And the team members can get a clear sense of progress being made. Thereby minimising the risk of such meetings being perceived as a waste of time!

And another point…the facilitator doesn’t have to be the boss. Just someone good at it!

Further tips on having effective meetings at:

https://tonyreiss.com/2013/10/02/why-lawyers-have-long-and-difficult-meetings/

https://tonyreiss.com/2020/05/06/bad-meetings-dad-decisions/

https://tonyreiss.com/2019/05/01/better-ways-to-run-meetings-and-firms/

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Pricing and Fee Negotiating – Training Product Using VC

I’m a great fan of using technology to drive efficiencies and improve performance and have pioneered the use of video conferencing –  not just to provide information – but to change mindsets and develop skills.

My latest product is a 1.5 hr session on pricing and fee negotiating.

Here are the main themes:

  1. The importance of selling value – ultimately, what you charge is determined by several factors, but an important one is the perceived benefit in the mind of the client (both organisationally and personally by the contracting client) of using a top notch firm such as yours rather than a discount firm.
  2. The pros/cons of different pricing options – what’s good for you and what’s good for clients – how to steer successfully between these options to achieve a win-win.
  3. Pricing the three different levels of professional firm services – Expertise (‘You Bet Your Farm’), Experience, Efficiency (for high volume and low margin work)
  4. The Cobb Curve – what happens to margins on professional services over time as products become commoditised
  5. The four-stage negotiation process – most firms just use one stage – I advocate adding three further stages which benefit the firm and avoid misunderstandings
  6. How to respond to clients saying ‘that’s too expensive’
  7. How to renegotiate the fee if the scope or goalposts move
  8. Estimating the fee in the first place – how to minimise the risk of under quoting, using bottom up and top down processes
  9. The psychology of pricing – using techniques such as anchoring, the use of ranges of services, the importance of helping clients minimise risk, the appropriate use of language
  10. Margin improvement – to address the challenge of delivering matters on fixed fees with potential undercutting competitors

I get really good feedback from these programmes! A small investment could make you a lot of money!

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Checklist for Coaches – First Meeting with Client

That first coaching meeting is so important. So many things to cover and it can be really important to have a proper, well-founded set up. Here’s my checklist:

  1. What are their expectations
  • Previous experience of coaching
  • What are you expecting, hoping for from coaching?
  1. Explain and reassure on confidentiality
  1. How the coaching process works
  • It’s their agenda
  • Raising awareness
  • Keeping responsibility with them
  1. Their role:
  • To be open to change, learning and growth
  • To be willing to try new things, different ways of working
  • To be honest – with themselves and with the coach
  1. Coach’s role:
  • To provide a safe place to discuss any topic without judging
  • To support and challenge, probe and clarify
  • To provide feedback (if wanted)
  • To be direct and honest
  • To encourage action
  • To promote learning and growth
  1. What coach will not be doing
  • Counselling, therapy
  • Life coaching
  • Providing all the answers / solving all their problems for them
  1. Areas of primary focus
  • What’s got them this far – background, choices, etc?
  • What’s important to them – values?
  • How would they like things to be different?
  • What do they specifically want to work on?
  1. What will success look like in practice? (measures & timeframes)
  1. What might get in the way?
  • Handling inner doubts
  • Dealing with failure
  • Realism about time frames
  1. Finalise logistical arrangements
  • Format  (face-to-face, phone, VC)
  • Place
  • Frequency
  • Policy on cancellations, timeliness

Have I missed anything?

 

 

 

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Economists are Wrong! Clients Buy Based on Emotions

Source: The Economist

The conventional belief of economists (and all other scientific, logical disciplines such as finance and the law) is that people are logical. What nonsense!

Homo sapiens is a highly complex creature that is difficult to comprehend. But we buy based on emotions and post-rationalise based on facts.

If you can remember the last time you bought an apartment or house, you’ll know what I mean. Maybe you had a good impression from the outside. Maybe deep-down it reminded you of somewhere else. But it made you feel good. We usually can’t put our finger on why.

However you can’t spend all that money based on feelings, so you check the details: the train service, the local schools, the nearest park and convenience stores. You want the apartment but only offer to buy when you can justify the purchase rationally.

So when trying to persuade clients to use your services ask yourself: What’s the client’s emotional hot button here?

Sometimes it will be to look good to their boss, perhaps because you frequently update them on issues and progress. Sometimes it will be sleeping better at night or to have less hassle in their life. There’ll always be something.

Rory Sutherland, Vice Chair at Ogilvy UK, speaks eloquently and says that those involved in business development need to avoid having the rational, economist mindset. You will do well to avoid being overly logical. Often doing the opposite of what your competitors are doing will work well for you.

 

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