Back to Basics – a business briefing for lawyers: Marketing made simple

Welcome to the latest edition of Back to Basics — a Business Briefing for Lawyers. This month the focus is on marketing—and it’s not just advertising that we’ll be talking about. Marketing touches every aspect of your firm. It starts with your ability to deliver to your clients what you say you’re going to deliver and ends with winning new business through a process of designing systems and methodologies that allow you to provide services that are fit for purpose and then telling the world at large about them.

Gone are the days when a solicitor could depend on having a “client for life”. There are very strong competitive forces out there—and the worrying thing for lawyers is that their competition is no longer just other lawyers, but other more commercially minded enterprises— and that’s before we even have to consider the impact of ABS! This edition will look at marketing as a tool to help you improve your business performance by ensuring that you’ve done the ground work and then proclaimed your capabilities to the world at large.

Marketing is not a “One-off” activity

The are many anecdotal stories of solicitors conducting a “Wills Campaign” and then declaring “It didn’t work for me”. Well, there’s a very clear difference between sending out a mass mailshot to a whole bunch of people who you believe are still clients and conducting a well thought out, structured and continuous campaign to ensure that those of your clients who might not have a Will think about making one—and those of your clients who do have a Will, review it on a regular basis.

Whatever else Marketing is, it is an activity that must be undertaken on a continuous basis—and that means that there is a need to ensure that it is properly resourced. I don’t mean by this spending a lot of money on expensive advertising. What I mean is that someone in the firm needs to take responsibility to ensure that whatever the firm does to design and promote its services , it is done, properly, professionally and, most importantly, continuously.

The four Ps of marketing—Product, Price, Place and Promotion apply just as much to the legal profession as they do to any other commercial organisation—with the P of Products being replaced with the S for Service. So, try this for a very quick exercise: Review the Services your firm provides, determine the Price at which you will provide those Services, decide where you want to Place your Services and then Promote them sensibly and continuously. You need to plan this carefully and engage with others in the firm to do this. And once you have your plan it’s not always necessary that a lawyer has to actually run it—some would say that it would be best if the lawyers weren’t involved in the aspect of running it at all!!

Don’t keep your services a secret

How often have you heard one of your clients say “I didn’t know you did that”. This is not unusual in the legal profession because lawyers are not particularly good at promoting their services to their clients. This also raises the question of who are your actual clients and who should you be promoting your services to.

The legal profession has a tendency to count as its clients those people for whom they’ve carried out a piece of work. So, if you bought or sold a house for someone, say, 5 years ago, it is likely that you still count that person as a client. As a result of some accident, rather than anything else, your “client” contacts you at the end of that 5 year period to say that he’d like to use you to sell his house—and that he’s using “Such and Such Estate Agent” to do the marketing. While you’re on the phone to the client taking his instructions he tells you that since the last time you met he’s made a Will through another solicitor (or, even worse, through a “Will Writer”), arranged the winding up of his mother’s estate through her solicitor even though he was the Executor, used a “no win, no fee” company to help him claim compensation for the accident he had 3 years ago and, then, remortgaged his home last year on the expiry of the fixed term mortgage that he had when you bought the house for him in the original transaction. When you tell him you also provide estate agency services the now infamous words “I didn’t know you do all of that!” are uttered! In this case, just think about the amount of business (and money) you’ve lost by failing to keep in touch with this client.

If your client was aware that you provided all of the services he needed over the years there is every likelihood that he would have used your services rather than going elsewhere. Don’t keep what you do a secret. Let your clients know the range of services your firm provides. Keep in touch with your clients on a regular basis. Don’t fall into the category of the “can’t be bothered”. It costs you far more to win a new client than to keep and continue to provide services to an existing client. Do this: work out what services your firm provides (yes, this is a good idea—some firms are not entirely clear what services they do actually provide), set them out in an easy to read format (either electronically or on paper) and devise a means of communicating them to your clients. It is absolutely essential that you are in touch with your clients on at least 2 occasions every year—3 is better but as a minimum you need to be in touch more than once. Make the effort—if you don’t, someone else will. If you can’t allocate the time to this, outsource it—but make sure that you do it in such a way that you retain control of the activity AND the cost—marketing has a tendency to run away with the budget if you let it. Finally, use whatever means possible at your disposal to market to your clients—electronic as well as paper—and best of all, a combination of the two. Solicitors have a “lead list” that commercial organisations would give their eye teeth for—you should use this to this maximum extent possible.

Simon says…..

I wrote an article for the LawWare Newsletter (Winter 2011) which took a cursory look at the current state of legal marketing in England, as they are further down the ABS line than we are, and noted the influx of professional marketing organisations entering the market using TV advertising to communicate with the target market and the Internet as a delivery base for the service, highlighting QualitySolicitors and Wigster as examples.

The approach of these professional marketeers is very different from that of legal firms themselves. The approach of Legal firms both north and south of the border is similar – either they know what they do and can communicate it, or, they don’t and don’t. I went on to develop a few points – Once the English marketing model is established – the marketing machine won’t stop; it learns, it develops, it gets better. Other suppliers come into the market, offering slightly different services, but at a better price point. And so the marketing machine gathers momentum and pace. Scotland will be regarded as just another target audience and the numbers will be crunched, the strategies written and executed. And remember – your ‘Client’ is someone else’s ‘Prospective Client’. The two examples of change I highlight are both Internet based.

The Internet is the medium of choice for demographics A1-3, B1-3 and C1’s to find potential new suppliers and services – these are the people that have any kind of disposable income. The sort of people firms should be trying to attract! Change is often powered by IT. It is usually delivered by IT. But it is rarely because of IT. Change occurs when someone wants to achieve an objective, understands how to achieve it and can convince others to back the objective.

None of these characteristics are ‘Legal’ – they are ‘Entrepreneurial’. So as well as being good legal analysts and good business managers; Partners of Law firms have to be Entrepreneurial too. So YOU might have to change, maybe develop new skills, maybe hone existing ones. This is not a bad thing; to develop oneself is an admirable personal aim. There are many books and courses that can help. Perhaps look at the CPD requirement in a slightly different shade of light – the personal development requirement is there for good reason and I think it is time that we all got better at this side of our roles.

We are here to; provide a service; different clients require a range of services to suit their needs, and so we must develop and adapt those services as our clients’ needs change or are changed, and, we must attract new clients. It’s up to us to secure the future of our organisations, especially so when the future changes faster than it ever did before. So for this new year I resolved to be a bit more entrepreneurial and I encourage you to be too, for your own good and your clients. Simon Greig is Sales Manager of LawWare Limited, Edinburgh. Contact Simon at simon@lawware.co.uk

It’s the little things that matter

Just saying “Thank you” to a client can reap huge rewards. As an absolute minimum, you should thank your client on your engagement and on completion of the transaction—and for goodness sake, don’t say “thank you” at the end of a case and at the same time try to ram further services down his throat! Leave a decent space between completion and the offer of any new services you can provide to the client—and always remember—if the client should happen refer someone else to you, you must thank the client for that referral.

Is social media the answer?

The Internet offers a fantastic opportunity for lawyers to communicate with their clients, no more so than through the use of social media. The Facebook and Twitter phenomena means that people are in touch with each other on a daily basis and by using blogs you can get your opinion out to the masses. Professional media sites like LinkedIn give business people the ability to make contacts and the old words like “networking” and “making friends” seem to have gone by the board. This is all very well—and it is good to use social media, blogging and other online tools to promote your business—but it pays to make sure that you are able to capitalise on the opportunities that this medium offers—and that you don’t ignore more traditional marketing routes. If you do engage with social media, please make sure that you do so professionally, respond to enquiries promptly and that your online presence is managed. Doing this will ensure that your services are being promoted continuously and in the right way. Stephen Moore of Moore Technology Limited is an expert in this field and his advice is that before embarking on any online strategy it pays to decide what you want to achieve, how you want to achieve it, how you keep it current and how you manage the resulting enquiries. Visit Stephen’s web site on www.moorelegaltechnology.co.uk

Contact us

Brian O’Neill LL.B MBA, Business Consultant, t. 01294 833220, m. 07855 838395, e. brian@drakemyre.co.uk

Simon Greig is Sales Manager of LawWare Limited, Edinburgh. Contact Simon on simon@lawware.co.uk

Back to Basics — a Business Briefing for Lawyers: Succession and Retirement.

Welcome to our most recent edition of Back to Basics — a Business Briefing for Lawyers. This month the focus is on Succession, Succession Planning and Retirement.

I’m delighted to include in this edition, an article by Douglas Mill, former Chief Executive of The Law Society of Scotland and currently Director of Professional Legal Practice of the Diploma in Legal Practice at the University of Glasgow. Douglas has a special interest in this field and has advised many firms on their succession strategy.

No matter how far you’re into your legal career, you need to think about and make plans for your succession—and review these on a regular basis. Whilst your retiral may not be imminent, it will come at some stage and it’s best to be ready for it when it does.

If you need any help in this area, please get in touch with me—I’d be delighted to help.

Brian O’Neill LL.B MBA

Business Consultant

40c Drakemyre

Dalry

North Ayrshire

KA24 5JE

t.  07855 838395

e. brian@drakemyre.co.uk

We all need to go sometime—how will you go?

This month saw the disappearance of two formerly prominent Scottish Legal Firms—and for very different reasons. McGrigors merged with Pinsent Mason—and became….Pinsent Mason. The Judicial Factor who had been appointed to manage the affairs of Ross Harper decided, on 30th April, that the business could no longer continue to trade and closed it down. Two names that have been most prominent in the legal profession for many years are no more.

We all need to consider the “end game” at some point. For myself, if was a change of career and leaving private practice as a solicitor to seek out new challenges. For some solicitors in recent times, their exit from practice has not been through choice but through the process of cost cutting and redundancy.

We are going through (and arguably, at last, beginning to come out of) the recessionary cycle—although the last two quarters of shrinking GDP would not have us believe that!! It continues to be incredibly tough for solicitors in firms of all sizes and the focus needs to be on managing the costs whilst striving to increase the revenue.

As market conditions slowly begin to improve, there is a need to reset horizons and start to concentrate on the strategic development of the business and a review of the business objectives. Part of this process should also be to consider the options you have for succession and how you might plan for that day when you take your foot off the gas and start to take more of a back seat.

Those of you who are partners need to consider how best to exit the business when the time comes—in fact, it’s a very good idea to have some sort of idea of when that time might be. My colleague, Stephen Vallance, made a decision some years ago that he would leave private practice before he was 50—and just a couple of years ago, at the age of 46, he negotiated a successful exit after having built a very successful and profitable firm.

So, when you’re revisiting your objectives and setting out the strategy that will take you forward as the economic cycle turns, don’t forget to look at the structure of your firm and take the time to consider what you need to do to ensure that you have choices as you head towards your chosen exit date. It’s simply no use to wake up on your 60th or your 65th or, heaven forbid, your 70th birthday and think “This is the day I’m supposed to retire….but I can’t do that because there’s nobody who can take over from me”.

Whether you wish your exit to be phased or come to a quick end, if you have some idea of how you can secure a return on your investment at an early stage you will at least have something to strive for.

Simon says…..

Are you making a success of your succession planning?

There is a definite issue with succession planning nowadays and I know a fair few senior partners that have already recognised it themselves. I appreciate that this is a multi-layered issue and Brian can only touch on it in the space available; I will target my comments on just a few areas in summary.

The traditional succession model where a senior partner is bought out of firm by a junior partner has failed. The banks will not lend the kinds of sums required by senior partners, so unless the money is in the firm to buy out a capital account – it cannot be bought out. Very few firms have these sums readily available and therefore it is my view that this model has failed, it just doesn’t work anymore and needs to be changed.

I understand why the banks won’t lend to junior partners and its nothing to do with the junior partners, it’s all to do with the banks perceived value in what the junior partners are buying – they perceive very little value. That is not to say there is no value in law firms – clearly there is – but the traditional partnership structure is perhaps out of sync with today’s economics. If a partner works 30 years building up his practice – this is recognised in the firm’s accounts; but from the banks perspective once that partner walks away the earnings power walks away too therefore, they argue, the potential earnings are dramatically diminished and the loan to return ratio is too short (and risky) and they will decline to loan. I understand the underlying problem too. The partner hasn’t created any self sustaining value in his business that enables the business to continue when he is absent from it. If you can demonstrate that your business is self sustaining then it can be the subject of a business loan rather than a personal loan; then that’s a whole different category of ‘investment’ that a lender can look at in a different light. If you haven’t developed this kind of business model, you need to take action now and be prepared to work until it takes effect; however long it takes.

There is a further challenge that ought to be recognised – if senior partners are working longer then there aren’t the opportunities for junior partners to move on up as quickly as they intend. These junior partners have more choice then to simply wait around for senior guys to get their act together. It has never been easier to start up yourself or with a group of like minded colleagues (LawWare’s LawCloud is experiencing huge growth in this segment) – in this scenario the senior partner is potentially left isolated with an asset that cannot be fully realised.

Another thing to be aware of – banks won’t support ailing firms for long nowadays. If firms are waiting for the recession to end before returning to better times – stop living in the past. The current business environment is the one you must live in and prosper within. There have already been major changes enforced on well known law firms as a result of not changing quickly enough; the resulting rapid mergers, or worse judicial factor appointments, are happening much more frequently nowadays. This is symptomatic of a ‘head in the sand’ culture. Don’t be like them. Law firms are businesses, if they are run on any other basis other than a sound commercial one, then I truly fear for them.

I was talking recently to a senior figure in the industry and I mentioned to him my greatest fear – the impending cull of senior partners that could potentially find themselves out on a limb because they wouldn’t change the business structure away from being all about them. He was shocked that I put it in such harsh words but he didn’t disagree. There is no safety in numbers in this regard; it is literally every man/woman for him/herself when it comes down to leveraging your capital account. If you don’t protect it – no one else will and as it has a direct impact on the quality of your life after work you need to be proactive – if you ever want to stop working that is!

Simon Greig is Sales Manager of LawWare Limited, Edinburgh. Contact Simon at simon@lawware.co.uk

It’s never too early…….to plan your exit strategy!

By Douglas Mill

The recession didn’t come at the right time for the legal profession in Scotland. Over-expansion over the last 15-20 years, allied to the ‘bulge’ of the Baby Boomers still 5-10 years short of retiral, created a sad situation—for this first time in the profession’s history retirement was not a given.

Much media focus has been on the big commercial firms whose structures and client work were such that they were most vulnerable when commercial work fell off a cliff. This quicklyon trainees and law students. Things became tough almost overnight. It takes 7 years generally to produce a solicitor, but the economy can crash almost instantly. People realised that getting into the profession was problematic. What has not yet been highlighted is that getting out is almost as difficult.

This applies to probably about 600 firms in Scotland—and a high percentage of our sole practitioners. It is going to be exacerbated as the effects of the Double-Dip kick in. It is simplistic to say the first wave of recession hurt the big firms and the second hit the High Street, but when people in public service start to lose their jobs the immediate impact will be felt by family lawyers.

It is hard to be over sympathetic to elderly partners who have taken the Lion’s Share for years, keeping good youngsters at bay on the age-old promise that “someday this will all be yours”. What will be? Partnership is now a risky business and banks will find many reasons not to grant practice loans—and forget getting £s for goodwill. This generation are more risk-averse—and for good reason!

Most solicitors haven’t been like that and it really is not hard to feel sorry for them. Most have been hard working stewards for their firm. However, the prudent investments in an Equitable Life pension and RBS shares have made retirement an ever-receding prospect. Reducing fee income makes it harder to earn new partners in and old partners out. Few partnerships talk openly about their plans and expectations. A good, say, 6 partner firm should have partners spaced apart in age, but who was ever that visionary?

Retirement ages are increasing and will continue to do so. The profession will have to adjust to that and start planning accordingly. Firms whose strategy is just to wait and see can expect their partners to die in harness. No one is going to do this for you. If your partners are reluctant to face these realities, prioritise yourself. Remember you have duties also to your family, friends—and yourself. It actually never is too early to plan your exit strategy—but in this climate it could soon be too late!

Douglas Mill is Director of Professional Legal Practice of the Diploma in Legal Practice at the University of Glasgow. Douglas can be contacted on Douglas.Mill@glasgow.ac.uk

Consider your options……

Most solicitors, when considering succession and retiral, look within the firm and, on many occasions, leave it far too late to bring on board Partners who have the right quality to continue the firm and secure a sufficient return to the retiring partner. This assumes that the firm is a Partnership. When considering your succession options, you might want to have a look at your business vehicle and work out, with your accountants and financial and business advisers, which would be the most suitable, tax effective vehicle to be in when you’re looking at building a succession plan—the traditional partnership model may not be the right vehicle for the job and an LLP or Limited Company might be a much better option.

An alternative might be some form of merger or acquisition—a sort of “buy in” of the right kind of talent that will secure the future of the business, enlarge its client base, improve its profitability (if economies of scale lead to reduction in duplication of personnel) and provide a platform from which you can extract sufficient value to get out when you want.

Alternative Business Structures potentially offer a further route for consideration—depending on the eventual percentage ownership interest available to the external investor and, leading up to retiral, could provide an option for disposal of part of the business for “cash”. This is an interesting area that will develop in the next year or so.

Building from within will probably remain the preferred option for most firms and, if this is the route to be followed, the sooner the planning starts, the better. Remember, this is business—and if you want the business to succeed you need to surround yourself with skilled, able people who can support the continuation of the business without you actually being there.

Finally, you must consider what your financial needs will be when you do decide to go. It’s essential to prepare a retiral budget to work out exactly how much you will need on a month to month basis—not only to spend on those essential bills, but to provide for unexpected eventualities. You really need to be as “debt free” as possible and that means you need to start now to plan your financial future and build up your nest egg to ensure that your retiral is as financially comfortable and secure as it possibly can be.

Contact us

Brian O’Neill LL.B MBA, Business Consultant, t. 01294 833220, m. 07855 838395, e. brian@drakemyre.co.uk

Simon Greig is Sales Manager of LawWare Limited, Edinburgh. Contact Simon on simon@lawware.co.uk

LawCloud: Legal Case, Matter and Practice Management for Law Firms UK

Cloud computing simply isn’t that scary anymore…

Following a recent survey published by Forbes, it is clear that “Cloud Computing simply isn’t that scary any more”.

The survey refers to claims that “a meagre 3% of companies considering Cloud consider it to be too risky.”

It goes on to say “The bottom line is cloud is now just considered the normal way to implement software solutions.”

LawCloud supports this and has seen a consistent rise in the number of law firms in the UK adopting Cloud. It has added a live counter widget to the homepage of its web site showing that it now hosts 83 law firms on its Cloud platform (as at June 2012) and this figure is growing by the week. This is proof that Cloud is a natural way forward for both new starts and existing law firms looking to be Smart and make better use of technology.

The launch of Windows 8 is just around the corner and Microsoft has taken the decision to launch its own tablet device. Whilst the decision from Microsoft to deliver its own hardware for the Windows 8 platform is seen as controversial (in terms of alienating its hardware business partners such as Dell, Acer, HP etc), Microsoft sees this as the way forward and as real a rival to the iPad. You can find out more about their new Microsoft Surface Table here Microsoft Surface Table here or Google Microsoft Surface Tablet to find many up to date news stories relating to its specifications and launch.

Alongside its Security white paper and Law Society Cloud Guidelines response document, LawCloud has now published its Statement of responsibility for security and resilience.

This is supported by 3 new Client Case Studies demonstrating the success of the Cloud and its impact on 3 small law firms.

If you would like to find out more about best practice for law firms adopting Cloud, please do not hesitate to contact me directly at warren@lawware.co.uk

We have gained a wealth of experience over the years and LawCloud is now recognised as one of the foremost suppliers of Cloud based legal software in the UK.

LawCloud: Cloud for Lawyers UK