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4 posts from June 2006

June 28, 2006

Don’t argue about this

For the last 20 years, I’ve trained and coached professional sales people. In all that time, I don’t think single sales person has ever argued with me. Mind you, some have ignored me, but nobody ever argued. They just smiled and moved on.

Then I started selling to lawyers. All of a sudden, I could not get through the first 10 minutes of a talk before someone would raise a hand to question my conclusions and ask about my evidence.

The experience gave me flashbacks to my days in academia, where arguing is a valued skill, and it is a matter of honor to challenge every assertion. To some professors, there’s nothing quite as satisfying as asking a pointed question at a colloquium, and bringing the speaker to his intellectual knees.

In an article in the April 2006 issue of The American Lawyer, David Maister wrote: “lawyers are professional skeptics: They are selected, trained, and hired to be pessimistic and to spot flaws.” An argumentative approach may be exactly what is needed when one debates the law, but lawyers must change gears when they want to develop new business.

In the 1880s, John Patterson of National Cash Register wrote one of the first sales manuals, which included this advice:

“Never argue
Never offend
Never think or act like you are defeated
Try to make a friend at all costs
Try to get on the same side of the fence (harmonize).”

In the book How to Win Friends and Influence People, Dale Carnegie’s explains twelve principles for “How to win people to your way of thinking.” The very first is “The only way to get the best of an argument is to avoid it.” Among many others, Carnegie quotes Benjamin Franklin: “If you argue and rankle and contradict, you may achieve a victory sometimes; but it will be an empty victory because you will never get your opponent’s good will.”

Once you’ve cut back on arguing, you might want to work on your optimism. When you’ve spent an entire legal career preparing for things to go wrong, and cleaning up after things that actually have gone wrong, it’s hard to be optimistic. I feel your pain. I earned the nickname Doctor Doom at one of my first technical positions, by always predicting how things would go wrong. But I had to learn to be more positive when I switched to sales. When that doesn’t work, I fake it (as explained in a previous post).

Patterson’s sales manual instructed his staff to “take it for granted that everyone can buy.” Every person they met was to be called a PP - a “probable purchaser.”

To prove that anything was possible if only you believed, Patterson once organized a team of workmen to make an office building disappear overnight during a company meeting. While the sales people slept, the workmen knocked down a large office building and replaced it with a patch of grass. The point was remembered.

For as long as professionals have been selling, they have recognized the importance of staying positive and upbeat. When Ulysses S. Grant published his memoirs in 1885, canvassers sold the book door to door. Ten thousand sales people were given a thirty-seven page manual entitled “How to Introduce the Personal Memoirs of U. S. Grant.” The section on “How to Leave the House” described the optimism they were expected to show after losing a sale: “Shower smiles on the people as bountifully as though you had received an order for ten copies – then walk off treading the ground as though victory sat enthroned upon your brow.”

This optimism paid off: Grant’s memoirs sold 325,000 copies in the first year, and his family ultimately received almost $450,000 in royalties, the equivalent of $8 million today.

For more details, and references for the quotes above, see Chapter 5 in my new book Legal Business Development: A Step by Step Guide, which will be available on Amazon in September

June 21, 2006

A new survey of law firm business development

Business development staffing and budgets are going up, according to a new survey just published by ALM Research and The Brand Research Company. 69% of the law firms in the survey also reported revenue increases, and “the largest share of growth by far is from selling more of the same work to existing clients.” Which is quite consistent with the respondents’ views of what works best: “Among eight business development strategies tested, respondents tend to report that the most important factor in their firms’ growth is client relationship development.”

The full report includes details on everything from budgets and compensation to the use of client service teams and seminars. It’s based on a survey of 1,000 large law firms conducted between November 2005 and January 2006. The 157 firms who responded were divided into two groups. Just over half (54%) were classified as Tier 1, because they appeared on at least one of the standard industry lists of large firms (the Am Law 200, the Global 100 and/or the NLJ 250). The rest (46%) were classified as Tier 2 firms. Tier 1 firms averaged 489 lawyers, and Tier 2 firms averaged 118.

Given how I make a living, I was most interested in the data on sales training. That glass can be seen as half empty or half-full: 58% of the firms have provided sales training to some of their lawyers. Larger firms were more likely to provide sales training (69% in Tier 1) than smaller firms (46% in Tier 2). When firms did provide these programs, an average of 48 partners and 34 associates completed them.

The vast majority of these sales training programs (88%) used an outside consultant, which I think is an extremely good idea. (Not that I’m biased, or anything.) In many cases, someone from within the firm also taught in the program (33% of the firms used an internal specialist, 31% used a lawyer who was successful in sales).

When Sue Stock Allison of the Brand Research Company and Katherine Daisley, Marketing Manager for ALM Research, presented these findings last week at the Legal Sales and Service Organization’s RainDance Conference, what captured the headlines was not the number of firms that were training lawyers, but perceptions of the results. When the marketing professionals in the survey were asked to rate eight factors that contributed to revenue growth, sales training came in dead last.

When strategic marketing consultant Larry Bodine, founder of the Law Marketing Portal, described the audience reaction in his blog, his post was titled “Shock and Awe at LSSO: Sales Training Doesn't Work.”

I’m writing an article for Law Firm Inc about this result, called Sales training: What works with lawyers. After the magzine comes out, I will summarize what I learned about this in talking to experts from Akin Gump, Bingham McCutchen, Day Berry & Howard, Drinker Biddle, Fish & Richardson, Goodwin Procter, Ropes & Gray, Schiff Hardin and Womble Carlyle. The short answer is that the term “sales training” is applied to many different approaches, and that some work better than others.

Based on what I’ve seen in other industries, I predict that in the next few years the role of internal trainers will grow, as legal sales training becomes more widespread. Standardization will also become an issue as large firms need to assure that everyone sells similar services in similar ways. In fact, I believe this so strongly that I have made a substantial investment in it. Professionally produced training programs and “train the trainer programs” are standard in other industries, but are just starting to appear for law firms, which is why I'll publish my Law Firm Business Development Workbook in a few months.

If you’ve been reading this blog for the last several months, you know that I have also spent a lot of time talking to experts about the best way to perform client satisfaction interviews. (For example, see my five part series on “How to review client satisfaction” and the summary recommendations in the blogs on “How to conduct client satisfaction interviews.”) So the next thing I turned to in the ALM report was the section on client satisfaction interviews. Again, the glass is either half-full (56% of these firms conducted client satisfaction interviews) or half empty (44% did not).

The full report includes many details about which clients are surveyed, how often, and by whom. You may remember that in my five part series, experts disagreed about whether these interviews should be conducted by lawyers themselves or by outside consultants. The ALM data reflects this split: 50% of the firms conducted the interviews and managed the process with their own staff, 33% used an outside firm, and the rest used a combination.

So what does it all mean? All the trends point in the same direction: more emphasis on selling, and an increasingly competitive environment. So if you think it’s hard to protect and increase revenues now, wait until next year.

June 14, 2006

Increase new business by re-connecting with past clients and colleagues

When you want to build new business, it is always easiest and fastest to start with people who already know you. Your current clients should come first. After that, the next place to look is past clients and colleagues. According to research quoted in The Rainmaker’s Toolkit by Harry Mills, it’s much easier to sell to a lost client (the chances of success are 1 in 3) than to sell to a new prospect (the chances of success are 1 in 8).

How to re-connect. Make a quick list of people you used to work with. Most can probably be located with a few phone calls or five minutes on the internet. Then all you have to do is find time to pick up the phone or send an email.

If the situation feels awkward, look for a natural reason to re-connect or an excuse to resume contact, such as:

1. If you see an article about their company or industry, mail a copy with a note.
2. Search the web for something about your contact or a fact of mutual interest, then email a link.
3. Use a more personal reminder, such as a change at a restaurant where you used to meet for lunch.
4. Try to arrange a meeting the next time you attend a conference in their city.
5. Ask for advice, if you’re hiring a printer or a graphic designer or another vendor.
6. Invite them to a talk you’re giving.
7. Send an announcement and a personal note about something they would find interesting about your firm, such as the promotion of an associate they worked with.
8. Ask if they would serve as a reference.
9. Offer them a referral for new business.
10. Make up your own excuse.

Follow up. As soon as you re-establish contact, follow up quickly to move the relationship forward. Provide a simple next step by asking a question that is easy to answer, such as “Did you see this article?” Don’t ask about business opportunities or referrals until you feel comfortable that the relationship has been re-established. If the person does not respond to your email or message, you may be tempted to quit there. But maybe your email never got there as a result of a spam filter. Or maybe your voice mail arrived when they were very busy, and got lost. There is always a time to give up on trying to contact a past client, but it is never after a single try.

Take the first step today. Make a list of five ex-clients and colleagues you’ve lost touch with. Prioritize them, define an action item for each, set some deadlines, and pick up the phone. Most people will be glad to hear from you. The hardest part is that first step.

Note: This posting is based on a piece I published in Massachusetts Lawyers Weekly, December 19, 2005, p. 26.

June 07, 2006

Six facts every lawyer must know to develop new business – Fact 6

My sixth and last fact in this series is “Selling is all about relationships.”

People hire lawyers they like and trust. That makes it sound like developing new business is easy: you just need to get the right people to like and trust you.

And it is easy with current clients. David Maister’s book The Trusted Advisor includes guidance, examples, and anecdotes to help you do the right things, at just the right moment. He also explains many other benefits of this approach -- “the more clients trust you, the more they will”:
Be inclined to accept and act on your recommendations
Treat you as you wish to be treated
Forgive you when you make a mistake
Refer you to their friends and business acquaintances
Pay your bills without question

Building relationships with people who don’t know you is much harder. One place to start is Bob Burg’s book Endless Referrals. Burg notes that, when all things are equal, people prefer to do business with others whom they know, like, and trust. Networking can expand the number of people who know, like, and trust you.

He explains how to network more effectively by always asking what you can do for people, not what they can do for you. If you meet someone new at a business networking event, Burg advises you to: “Invest 99.9 percent of the conversation asking that person questions about herself and her business. Do not talk about you and your business.” (p. 22) Ask the person to describe their ideal customer, and then see if you can help them find some new ones.

He sums up his approach this way: “Networking involves giving to others and helping them succeed in their lives and careers. When accomplished in a pragmatic and organized fashion, we find that we get back what we put out tenfold, both personally and professionally.” (p. 7)

Dale Carnegie’s classic How to Win Friends and Influence People is another great source of information on how to build relationships. For years, I dismissed this book because the title sounded silly and manipulative. For an elitist like me, the fact that it sold 15 million copies was irrelevant.

Then I read the book, and was surprised by how useful it was.

It’s a hard book to summarize, because the short version sounds folksy and trivial. But all the stories and examples bring home some fundamental truths, which have important implications for getting along with people, which is the most important skill in selling.

For example, Carnegie’s first fundamental technique for dealing with people is one that some lawyers could use work on: “Don’t criticize, condemn, or complain.” There’s no point, Carnegie says, because people won’t listen to you anyway, and you’ll just annoy them. My favorite example was Al Capone, who described his criminal career with this: “I have spent the best years of my life… helping [people] have a good time, and all I get is abuse.” (p. 4)

Carnegie’s second fundamental technique is “Give honest and sincere appreciation.” He quotes John Dewey’s belief that “the deepest urge in human nature is ‘the desire to be important.’” (p. 18) Apparently, even the father of our country was not above this; Carnegie says George Washington asked to be addressed as “His mightiness, the President of the United States.” (p. 21)

Throughout the book, Carnegie provides example after example, and story after story, to support his fundamental argument: “When dealing with people, let us remember that we are not dealing with creatures of logic. We are dealing with creatures of emotion, creatures bristling with prejudices, and motivated by pride and vanity.” (p. 14)

Carnegie’s list of “how to make people like you” includes these techniques (which I have reworded slightly):
Become genuinely interested in people, and show it.
Address people by name.
Encourage others to talk about themselves.
Learn what other people are interested in, and talk about it.
Make the other person feel important – and do it sincerely.

Again, this short version of Carnegie’s list sounds almost trivial. But reading all the details convinced me to pay more attention to these fundamental truths, and gave me some new ideas for how to apply them. At one point, I actually put the book down to rewrite a letter, to say less about what I could do, and more about what that person wanted.

So that is the last of my six facts that every lawyer must know to develop new business:

Fact 1. There are many ways to sell
Fact 2. You must start with current clients
Fact 3. You must ask the right questions
Fact 4. You must define advances
Fact 5. Selling is a numbers game
Fact 6. It’s all about relationships

If you’d like to know more, see my new book Legal Business Development: A Step by Step Guide, which is coming out in September.