Letter from America: Hand in hand
Law firms' marketing and risk management functions are symbiotic, says Thomas Berman of Berman & Associates
The marketing and risk management functions within a law firm are, in many ways, on parallel paths and symbiotic in nature.
Successful law firms are generally those which market their services effectively. They also seem to be able to set themselves apart from the competition and tend to manage themselves more effectively than their peers.
The similarities may go deeper, however, behind the headlines and the new client acquisitions. They generally include an understanding of the value of the marketing impetus in the global operation of the firm, the importance of cooperation among lawyers and practice areas, the development and maintenance of standards of the practice, and the training and upgrading of lawyers’ skills and abilities.
Effective marketing inside a firm requires many of the same qualities for which practice management and risk management are noted. Although risk management is generally thought of as perhaps subtracting from the bottom line (because of the extra effort or expense it may require) the argument can be made that it serves to create an inter-mural environment in which a law firm can succeed and prosper.
In its own way, risk management could be considered to be as, or more essential to, a law firm’s growth and economic prosperity as an effective internal marketing programme.
Parallel paths
A well-conceived internal marketing programme requires coordination and planning; it requires an understanding of the firm’s strengths and of the firm’s weaknesses. It requires an understanding, too, of the firm’s competitive environment: what it takes to succeed as an entity.
Risk management requires much of the same information and firm knowledge. For a firm to practice in a safe and secure manner, structures must be in place to support and at the same time provide a degree of control over lawyers’ actions.
The infrastructure must be clear and effective. That degree of quality of management begets the kind of information required to make decisions and to react to the many external pressures upon the firm.
Symbiotic relationship
Creating a well-designed institutional marketing programme can provide a major step forward toward realising a firm’s risk management efforts.
For many small and medium-sized firms, compensation is very much up to the individual partner. The ‘eat what you kill’ credo is not at all uncommon for such firms. In their case particularly, the ability to insert ‘cross bracing’ (horizontal supports) to the practice is a critical necessity.
A well-conceived marketing plan does just that. The plans, by their very nature, develop the individual lawyers’ practice. More than that, they ought to require a general set of meetings in which lawyers will discuss their efforts. It is in the very nature of such meetings that individuals will learn of the activities, predilections and strengths of others in the firm. Two lawyers sitting next to each other may for the first time reveal common bonds, common client links and common understanding of potential client requirements.
All kinds of things are possible when lawyers start to communicate in this fashion. The benefits are many, but often felt far beyond the actual marketing and aligned instead in other discussions relating to everything from personnel to compensation.
Improving the balance
If the marketing plan is successful, so much the better. Most firms have only a small percentage of lawyers who produce the lion’s share of new business (10% of lawyers producing 90% of the business is almost the norm). So, if that number can be raised to 15% or even more, the firm is in a much healthier environment and one far less beholden to one or two lawyers. The dynamic inside the firm is altered substantially and more balance among lawyers and practice groups is in evidence.
That in turn means that there is more effort that can be leveraged to cope with common problems and take care of the common weal. The firm is healthier, more able to compete and the practice carries with it far less risk. It’s a ‘win-win’ situation.
tberman@bermanassociates.net