With Validatum Pricing Espresso® we aim to bring you your regular pricing 'shot' - the best, most interesting, thought provoking and informative material we can find globally which will be of interest, relevance and help to you in your legal services pricing challenges. [Note: we don't always agree with the content of others that we post but the philosophy of Validatum Pricing Espresso® is shared perspectives, not a personal 'soap-box']
#1 Planning for the RFP Storm...
This is Part 1 in a series of articles on managing client RFPs. I read the BTI Consulting’s ‘mad clientist’ blog with interest this morning, about the predicted rise of RFPs in 2019 among the largest law firm clients.
I read the BTI Consulting’s ‘mad clientist’ blog with interest this morning, about the predicted rise of RFPs in 2019 among the largest law firm clients.
I have to say, I’m inclined to agree. As we move into February there are portents that this is going to be the year of the RFP, with daily articles in the legal press that big multinationals are planning to come out to market. Read more...
#2 Planning for the RFP Storm...
In part 2 of this 3-part weekly series, I will get into more detail on what that checklist looks like and why. Last week, we began this 3-part series with what we see as a major, systemic and permanent rise in the use of RFPs which many firms are struggling to adequately resource yet still achieve acceptable win rates and margins.
We concluded part 1 with an explanation of how we run a tender preparation workshop to explore key themes that are likely to emerge in the tender.
Beginning with a general introduction about the client, we work through a checklist of questions designed to develop a tender strategy and an outline project plan from which we are able to identify work that can be completed in advance of its issue. Read more...
#3 Planning for the RFP Storm...
Last week, in our 2nd instalment in our blog series ‘Planning for the RFP storm’, we talked about the types of questions firms should be asking themselves and the pre-work that can be done prior to RFP issue. In this, our final article, I’m going to talk about bid triage – deciding whether or not to respond to an RFP. It’s an unexpectedly sensitive topic.
The agonies that law firms and partners go to decide whether or not to bid for a piece of work or panel place have really surprised me since moving to ‘work for the other side’. What I thought would be a very straight forward commercial decision about profitability, is anything but.
When procurement teams look at who to invite to tender, the decision is largely based on very logical criteria asking themselves: Read more...
'Yes, we can do it for that price; 'What would you like me to leave out?'
"I am sick and tired of asking my external law firms for a garden shed and getting a bloody office tower and a bill to match!"
So opined [verbatim] a very frustrated FTSE 100 GC in a casual conversation with us recently.
Why this profound dissonance between expectation and reality? Why do lawyers keep delivering stuff the clients didn't ask for, don't want and won't pay for? Is it fair to characterise this behaviour as professional arrogance (‘…we know better than you’) and/or unprincipled and ill-considered up selling? Read more...
Help for the Frustrated Managing Partner – A Simple Framework for Coaching Timid Partners on Pricing Negotiations
There may not be another industry that self-commoditizes like legal, primarily because so many Partners choose to compete solely on price. While price is inevitably a component of all negotiations with clients, value from the client’s perspective is determined by many more factors that are routinely ignored by a Partner who is often willing to give discounts that the prospective client is not even requesting. Too often the goal is just to get some quick, and potentially unprofitable dollars in a data column for compensation purposes.
This phenomenon of self-commoditization is not limited to the routinized services. When pitching work, even some of the most experienced Partners offering the most sophisticated and tailored services will rely on price as their primary crutch. While this tactic may result in a “win,” it may also result in a diminished brand as a low-cost provider market position which, once earned, sticks for many years. Read more...
LAW FIRM ECONOMICS
Metrics? What Metrics? KPIs That Legal Ops Professionals Need To Track (Part I)
In two parts, this week and next, we’ll explore what it means to define and measure legal project success.
I’ve been working with people in legal operations for about 20 years now. Of course, most of my career has been on the law firm side, so I don’t claim to have an insider’s view of all the trappings of Fortune 500 legal departments. But I have experience as part of the legal team at outside counsel working with legal operations personnel. It’s not a stretch at all to gain understanding of how the relationship between inside and outside counsel works. Read more...
Are Lawyers Ready to Be Managed by Metrics?
There's momentum in Big Law firms, corporate legal departments and technology companies alike for a data-tracking system that could have radical consequences for the entire legal industry.
The billable hour has plenty of enemies, but Wendy Rubas wasn’t always among them.
As an associate at McDermott Will & Emery’s Chicago office from 1999 to 2004, she felt that, even if it was a taskmaster, it served another purpose—a measure of her value to the firm. Read more...
Inside Law Firms' Best Results in a Decade
Law firms were able to grow revenue more than expenses despite a big rise in the cost of associate salaries.
The law firm industry last year posted its best results in more than 10 years.
Post-recession highs in demand and billing rate growth drove strong revenue growth—critical in a year where expense growth accelerated. As a result, the industry saw the strongest net income and profits per equity partner growth we’ve seen since 2007. Read more...
What could large law firms learn from the Big Four?
It is often suggested that the Big Four accounting firms are coming to eat large law’s lunch. Conversely, we also hear that to both combat this incursion and achieve greater success with clients, law firms should emulate what accounting firms are doing.
Not surprisingly, both of these bon mots are likely wrong, and they don’t give enough weight to the far more nuanced relationship and differences in approach between the two professions. Read more...
Price publication rules 'will drive down costs and quality'
Solicitors are worried that publishing fees will encourage potential clients to obsess about price, which will affect their ability to uphold the integrity of the law, a regular bellwether suggests.
LexisNexis's latest report, The changing face of law, says the profession is facing an 'unprecedented level' of price pressure. Since December, firms have been required to publish price and service information on their websites, or to provide it to prospective clients on request if they do not have a website, for specific legal services.
The report states that respondents were concerned that the Solicitors Regulation Authority's transparency rules will 'further drive down costs and quality'. Even if firms reveal prices, some solicitors said it would not necessarily indicate what a client would actually pay. Read more...
More Evidence Rolls In: Law Firms Boosted Revenues, Profits in 2018
The second half of the Am Law 100 performed nearly as well as the top 50, according to Wells Fargo. Growth for the Second Hundred, while positive, still lagged significantly.
Law firm lenders at Wells Fargo and Citigroup, Inc. have been predicting for months that 2018 would turn out to be a post-recession high mark for the industry. On Thursday Wells Fargo finally revealed some full-year numbers, and they didn’t disappoint.
The Wells Fargo “year-end check-in,” featuring survey data from 150 law firms primarily in the Am Law 200, reported average revenue growth of 5.9 percent and average net income growth of 7.6 percent, the strongest numbers since before the Great Recession. Read more...
LEGAL PROJECT MANAGEMENT
The basics and benefits of legal project management: A discussion with Kate Bassett and Rob MacAdam
In the last decade, legal project management (LPM) has grown in popularity with law firms because of its ability to improve client service and efficiency. The demand from clients for increased involvement and transparency is being answered, at least in part, by the deployment of legal project managers within law firms. Clients have been quick to identify LPM as a key differentiator and are now beginning to request a review of legal project management strategies as a standard part of their RFP and firm selection process.
Recently, Rob MacAdam, director of legal solutions at HighQ, and Kate Bassett, global head of legal project management at Ashurst, discussed the current state of LPM, the role that technology plays, and what it's like to be a legal project manager. Read more...
Project Management Nuts and Bolts — Notes from the Field
Utilizing project management methods is the best way to deliver a desired project outcome. A very good way to learn the framework for project management is to manage a project. During the 2018 AALL PLLIP Summit, three panelists shared their experiences in “From Start to Finish: Getting their Project Management Game On.” This article summarizes their thoughts.
We spoke to: Read more...
Here are the key challenges facing legal project managers
What are the key challenges facing legal project managers? How do these challenges impact on their day-to-day working practices? What aspects of their role would legal project managers change?
These are some of the questions asked during my short survey of legal project managers, a survey supported by the International Institute of Legal Project Management.
I have yet to complete detailed analysis of the survey responses, but preliminary analysis soon highlights the key challenges facing legal project managers today. Read more...
LEGAL INDUSTRY LEGEND
Dr George Beaton - Founder of beaton and Professional Services Expert
On the show today we had the great pleasure of interviewing the amazing Dr George Beaton. George is the Founder of beaton, the pre-eminent ratings and review consultancy for professionals around the world. George has had a long and distinguished career in academia as well earning MBBCh, MBA and PhD degrees. George was a senior fellow in the Law School at the University of Melbourne and taught at the Melbourne Business School for decades. With a long career in academia and business George brings incredible insight to our discussions which covered client service, value based pricing and the future of practice.
George is presently Chair of the College of Law's new Master of Legal Business which is welcoming it's first students in February. This is a world first program designed from the ground up to equip professionals with the skills in business to spearhead great organisations. We discussed why this program is so important, what the College is trying to achieve, and what legal and other professionals can expect. Read more...