Harbert Management Corporation (HMCSM) is an investment firm managing approximately $2.5 billion in assets and committed capital in 11 new and existing alternative asset classes in three areas of concentration: real estate, private capital and absolute return strategies.
Q: If you think about your best relationships with outside counsel over time, what are three important things other lawyers could learn from them?
A: 1) Take the time to spend time with the client; don’t just deliver work product – that’s the only way a client can be comfortable that the lawyer really understands what is important and how best to achieve it. 2) Don’t be afraid to acknowledge your limitations and bring in additional resources. Struggling up a learning curve is more costly than expert assistance (both in time and results). 3) Appreciate that overstaffing a matter is the quickest way to sour a relationship. A good lawyer should be able to strike the right balance.
Q: And, of course, the follow-up: what are the top three things that lawyers could learn from your least successful relationships with outside counsel over the years?
A: One that deserves three entries: overstaffing a matter in the short term is a clear signal that the partner and/or the firm does not really value the long term relationship.
Q: What’s the smartest thing a lawyer or a law firm has ever done for you outside of doing great legal work?
A: Invested the time to get to know us – our people and our business. You can’t advise someone you don’t really know.
Q: Are there any client service or business development trends you’re seeing among law firms that you think are headed in the right direction?
A: Law firms and clients have talked about fixed or capped fees for a long time, and identifying circumstances that lend themselves to fixed or capped fee arrangements, on the one hand, and those that just don’t and never will on the other, takes long term experience within a relationship. I have the sense that firms that have such experience with a client are becoming more willing to experiment with these arrangements, and I think that is constructive. Some may prove to be less profitable than others for the firm, but over time the ability to project with certainty what has historically been an unpredictable and sometimes volatile expense will be valuable to the client.
Q: Have you ever fired a major provider of legal services or have you ever had internal suggestions that you should fire a major provider?
A: Not abruptly or climactically, but work follows the favored firms, and favor is always based on “what have you done for me lately.” In other words, never take a client relationship for granted.
Q: Would it have been helpful if somebody other than the relationship partner proactively requested your feedback and then acted on it, perhaps annually?
A: This obviously depends on the relationship with the relationship partner and his involvement in the matters his firm is handling for us. We use multiple firms for different work, and the relationship partner typically has a firm grasp of what his firm is doing for us and is in a position to evaluate how they are doing it. If that were not the case, I would expect other attorneys to be involved in the review process.
Q: In what ways and how frequently have firms asked for your opinion on their service or relationship with that firm?
A: Most firms provide aggregate billing data throughout the year, but very few take the time to sit down and discuss the bills or relationship in general (including issues they have on their side). We don’t demand a lot of structure around this, but I think it is a good idea for firms to impose it upon themselves because (you might be seeing a theme here) it shows that they value the long term relationship and aren’t taking it for granted.