Legal Business Development and Project Management

How to review client satisfaction - Part 5

A few hours after I posted Part 4 of this series, I saw persuasive responses first by Dan Hull, then by Michelle Golden, then Dan again (reacting to Michelle), then Patrick Lamb, then Michelle again and Dan again. They dug into many details, but generally argued that client satisfaction interviews should be conducted by outside consultants, not by senior partners as I had recommended.

Their arguments were compelling, so I decided to talk it over with the author of my favorite article on the topic, Peter Johnson.

Peter has conducted dozens of client satisfaction interviews as a principal at Law Practice Consultants, and started by saying “There are at least 6 schools of thought on the topic,” so it’s important to focus on the central issue. “The point of the interview is to show clients you care about their satisfaction and are invested in the relationship.”

Peter believes that personal characteristics and skills are as important regardless of whether interviewers come from inside or outside. A successful interviewer must be able to build rapport, will understand what questions to ask and know how to direct the discussion.

After I talked to Peter for a while, I decided that I should have put more emphasis on my subtle final conclusion: the decision should be made case by case. As I wrote in Part 4, each decision should be “based on the individuals who are involved and the fundamental marketing question: what will make this particular client happy? A law firm surveying 10 clients could therefore decide to use partners with 5 clients and outside consultants with the rest.”

Peter also reminded me that we all agree on the single most important fact: Law firms must talk to their clients and bring the voice of the client into the firm. This matters more than any disagreements about exactly how to conduct the meetings. So if this debate leads to more interviews, we should all be happy. But, Peter warned: “It would be a real shame if law firms used arguments like this as an excuse to postpone meeting with their clients.”

How to review client satisfaction – Part 4

When I planned this mini-series on client satisfaction, I was supposed to stop after Part 3. But then other bloggers got me started again…

The day after Part 3 appeared, Dan Hull wrote about it in his blog What About Clients. (My favorite part was when he described my series as “great work… comprehensive, well written, practical.”) I had written: “To assure objectivity and openness, it’s better if the interview is conducted by a senior partner who does not manage the relationship.” Dan, himself a litigator and lobbyist, favors using outside consultants for satisfaction surveys. “Using third parties known by the client not to be employees of the firm, while more expensive, is likely to get better (i.e., more honest) results.”

The day after that, Patrick Lamb, a partner in a Chicago litigation firm, revisited the issue in his blog In Search of Perfect Client Service. He started out by saying “I have always believed that the senior members of firm leadership should do the surveys since their presence underscores the importance of the process.” But then he went on to talk about a BTI presentation which supported Dan’s view “that outsiders can more effectively get at the client's real feelings.”

Dan’s blog is ranked number three on www.blawg.org’s list of the most popular legal blogs of all time, and Patick’s is number one. So it’s not surprising that their comments led to further discussions in other blogs.

The first result of all this discussion was that my blog set a new personal record for the most hits in a week, almost doubling my previous high point. (That record was broken again the next week, when Patrick Lamb wrote about a different posting in my blog, but that’s another story.) The second result was that I went back to the book shelf and Google to read more about interviewing techniques.

There are lots of opinions, and conflicting views everywhere about the best interviewers. When all my reading was done, I decided that my answer is… it depends. But when in doubt, I’m sticking with my original recommendation: satisfaction interviews should be conducted by a senior partner.

My reasoning is based on the goals that lawyers have when they conduct client satisfaction reviews in the first place:

1) To protect current revenues with the interviewed client.
2) To increase revenues with the interviewed client.
3) To get referrals to other clients.

Now I don’t want to sound too cynical, but note that getting honest answers is not on this list. As Huthwaite sales training guru Tom Snyder likes to say, “This is marketing, not a science experiment.”

(Others might put referrals higher on the goals list, but given the current competition in the legal marketplace, I’d focus first on protecting what I have. I agree with Troy Waugh that “some clients are just more likely to give referrals than others… [some clients may] like you just as much but aren’t in the habit of giving referrals.” For more on this, see Waugh’s book 101 Marketing Strategies for Accounting, Law, Consulting, and Professional Services Firms, p. 193.)

Getting candid and forthright feedback may contribute to these three goals, which is why I suggested that the partner who conducts the interview should be different from the person who manages the relationship. But the primary goal is to generate more business, and I believe that having a senior partner shows the firm’s commitment to satisfaction and is usually the best way to accomplish this.

Maybe it’s my academic background, but my emphasis in the last sentence is on the word usually. The decision of who is the best person to conduct a satisfaction interview in a particular case should be based on the individuals who are involved, and the fundamental marketing question: what will make this particular client happy? A law firm surveying 10 clients could therefore decide to use partners with 5 clients and outside consultants with the rest.

And if all this talk has put you in the mood to survey your own clients’ satisfaction, be sure to see Peter Johnson’s excellent article “12 Steps to a Successful Client Interview Program” from the October 2005 edition of Marketing the Law Firm.

Law firms in the 21st Century

The title sounded ambitious -- “Law Firms in the 21st Century” – but Paul Clifford’s talk at the New England Legal Marketing Association meeting on January 12 delivered everything I had hoped for, and more. Now one of the principals at Law Practice Consultants,
Paul has practiced law for 30 years, including 12 years as the managing partner at Gadsby Hannah. The talk included data, analysis, and opinions on everything from globalization to professional business practices. Naturally, I listened most intently to the sections on business development.

Many of the trends Paul discussed are driven by a single indisputable fact: “The market for legal services is becoming more and more competitive.” It’s a buyer’s market. As large clients continue to merge and industries continue to consolidate over the next few years, this will become even more true.

In the 1980’s, he noted, business development was strictly the province of a few rainmakers, and marketing budgets were typically less than 0.5% of revenues. Today, everyone is involved, from the person who answers the phone to the most senior partners, and budgets are typically in the 1% to 4% range.

Paul quoted so many great statistics that I found myself ranking them. Number 3 on my list of personal favorites was “to be competitive today, partners must work 2500 hours per year,” an average of 52 hours per week over 48 weeks. 1800 of those hours will generally be billable. The other 700 are “investment hours” divided into three groups: 300 hours for practice management (where that applies), 200 hours for client relationship management, and 200 hours for marketing/ business development. He also noted that 2500 hours is on the high side, and 2200 hours is not unusual.

In discussing what lawyers should do with the 4 hours per week they’re developing new business, he started with an old joke that defines a lawyer as someone who is either talking, or waiting to talk. I’ve written before about the importance of listening in large sales in every industry, and was pleased to hear Paul emphasize its special role in the law.

This led up to my number 2 favorite statistic from Paul’s talk: when clients are asked why they use a particular lawyer, 80% stress service and relationships. (The remaining 20% fall into two equal groups: expertise and price.)

This reinforces the idea, again often emphasized in this blog, that current clients are lawyers’ best source of new business. And with client loyalty eroding, it is important to create “super satisfied” clients not just to get more business, but to protect what you already have. As he put it: “Unhappy clients don’t complain – they just gradually stop giving you business.”

Which led to my number 1 favorite statistic from Paul’s talk: in a survey published last October, AmLaw 200 firms were asked: “How many of the firm’s 20 top-billing clients have you met with to discuss the client’s satisfaction with your firm’s performance?” Only 1% had met with all 20, and more than half had talked to 5 or less. 6% had not talked to a single client. When I wrote my recent three part series on “how to review client satisfaction,” I knew it was bad, but I didn’t know it was this bad.

Near the end of the business development section of his talk, Paul summarized what clients want, and what lawyers need to provide to succeed in this challenging market:
• Availability and accessibility
• Listening
• Speed, execution and responsiveness
• In depth expertise
• A team approach, in which customers have access to more than just the relationship partner
• Understanding the client’s business

As Paul summed it up: “The biggest challenge is to get lawyers away from thinking like lawyers, and to start thinking like business people.”

How to review client satisfaction - Part 3

Parts 1 and 2 of this posting described how small and mid-sized firms can set up an informal client review process. Large firms need more formal processes. In this posting, I’ll discuss Akin Gump’s client service teams, one of the best known and most successful programs to date.

It all starts with commitment, and in September 2003 this 900 lawyer firm showed its commitment to client satisfaction by creating a new position for an ombudsman to serve on behalf of the firm’s clients. The goal was to add value for clients by providing better service and communications, and to become more proactive in anticipating and meeting client needs.

Akin Gump recruited Iris Jones, a litigation attorney and certified mediator, who was then serving as the first police monitor and ombudsman for the city of Austin, Texas. At that time, Akin Gump -- like most law firms – did not have a single team that conducted formal reviews of client satisfaction. Now, just over two years later, over 60 client service teams are measuring client satisfaction, and acting on the results.

As I explained last June in this blog (see “No A plus's, but lots of new business”), Akin Gump’s basic approach revolves around a formal 90 minute meeting with each client. The process is highly structured, and begins with a training program for all participants. A lawyer is appointed to lead each client service team, to manage both the Akin Gump members and the client relationship. The team leader is responsible for everything from recruiting and coaching other members to scheduling meetings, building commitment and consensus, and following up on action items that emerge from the reviews.

The process is built around a 15 step checklist starting with background research on each client, including an analysis of “missed opportunity areas” in which the client uses other law firms, when they could be using Akin Gump. A customized list of about 30 critical questions is created for each client, and sent to the client in advance so they can prepare for the meeting and know what to expect.

The team leader not only conducts the meeting, but also drafts an action plan to improve client service. Typical action items that have come out of these meetings have included:
o training lawyers to write bills to maximize transparency, and assure that clients understand what they are paying for.
o controlling cost by managing the flow of information between the client and the firm to “reduce the number of touches.”
o creating written work plans that inform the client about who will work on each legal project, what they will do, and what to expect.
o scheduling follow-up meetings between key players.

Most importantly, the team leader’s job includes following up, to make sure that all of these action items are actually completed, and that the client is not just satisfied with the results, but delighted. Because the best way to protect and increase revenue is to meet the client service team’s fundamental goal: to protect, preserve, and expand relationships.

For more about Akin Gump’s approach, see Bruce Marcus’ excellent online article “All Together Now – It’s Our Client: The Client Service Team As A Growing Phenomenon.” It explains provides significant details about how “a growing number of firms have discovered the benefits of using the client service team as an approach to dealing with larger clients, for both better service and better client relations.” As Bruce sums it up: “The client service team is a 21st century answer to the dramatic changes in the professions and the clients they serve.”

Quotations reprinted with permission from THE MARCUS LETTER ON PROFESSIONAL SERVICES MARKETING (www.marcusletter.com). Copyright Bruce W. Marcus (marcus@marcusletter.com). All rights reserved.

How to review client satisfaction - Part 2

In Part 1 of this posting, I described the how and the why of client satisfaction reviews. This week, some suggestions on exactly what to ask.

I’m a big fan of keeping things simple, and believe your entire interview could be limited to these nine questions:

1. Rate your overall satisfaction with our firm, on a scale from 1 (extremely dissatisfied) to 10 (extremely satisfied).
2. What could we do to increase our rating to a perfect 10?
3. Can you describe any specific examples where our service could have been better?
4. In the past, what are some of the things that you’ve liked most about working with law firms, both ours and others?
5. What have you liked least about working with law firms?
6. How would you rate the likelihood of using our services next year, on a scale from 1 (extremely unlikely) to 10 (extremely likely)?
7. How could we increase the chances that you’ll use our services next year?
(Questions 8 and 9 should be used only with extremely satisfied clients):
8. Would you be willing to serve as a reference for us?
9. Do you know anyone else we should talk to about their legal needs?

The reason to use a scale from 1 to 10 is to distinguish people who are simply satisfied (the 6s, 7s and 8s out of 10), from those who are loyal supporters (the 9s and 10s). According to Harry Mills (in The Rainmaker’s Toolkit p. 83) “between 60% and 80% of all lost customers report that they are satisfied prior to defection.” So if you want to protect your revenue, your goal is to get your clients to 10 out of 10, or maybe even 11.

The interview must be conducted by someone who knows how to listen and probe for more information. Some firms use a consultant. I think it can be better to use a partner, as long as she is a good listener, and will be able to find the time to follow up.

If you have time, I’d recommend designing some custom questions for your practice and for each client. Consider including these issues, which often show up in surveys of client dissatisfaction:

Keeping clients informed.
Explaining legal issues in terms that clients understand.
Showing genuine interest and concern.
Being prompt and responsive.
Charging fair and reasonable fees.

You may also want to review some of the resources available on the Law Marketing Portal with questions on such matters as:

turn-around time
the amount and timeliness of status information
amount of attention your matter was given
attorney accessibility on short notice
listening to client concerns
understanding client goals
the type of information provided on billing statements
legal fees

Some of these surveys were designed to be sent out in the mail. Don’t use them that way. Go out to meet face to face with your biggest clients, and listen. Then deliver what they want, and watch your revenues grow.