You Think You Understand Your Client’s Business (But Do You Really?)
Too often, outside counsel misconstrue what it means to understand a client’s business. They confuse the simple concept of what a company does with a deeper understanding of why the company does it and how it is impacted by broader industry trends. In many client relationships, outside counsel wait for the phone to ring, listen to the specific ask by the client and then provide a work product. But those lawyers who grasp their clients’ motivations will act proactively and contextualize advice with industry trends and observations.
One client said it well in a recent interview: “We often have the habit of continually doing something the same way because we don’t have the advantage of hearing about new approaches to the same problems. Outside counsel see those things all the time, and I want them to bring that to the table in everything we do.”
That’s the definition of adding value.
We spend a disproportionate amount of our time working with our law firm clients focusing on delivering value to every client relationship. Critical to understanding value is the notion that every individual at every client organization wants outside counsel to understand the business and make life easier. To do this, firms must continually bring new ideas to the client about ways to work better, differently or more efficiently. They must understand how to help the client serve the company’s business goals. And right now, the conversations about accomplishing that are centered around efficiency and value.
“We often have the habit of continually doing something the same way because we don’t have the advantage of hearing about new approaches to the same problems. Outside counsel see those things all the time, and I want them to bring that to the table in everything we do.”
In recent weeks, I have interviewed clients ranging from one of the biggest and most complex Silicon Valley companies with radically changing needs to a mid-sized entertainment industry company seeking to stay competitive in an industry that generates more than 500 original programs each year.
What they have in common are that both clients are continuing to bring work in house, redefining how they use outside counsel and firing firms that aren’t delivering more than simple work product. The firms getting more work collaborate with clients, bring new ideas and contextualize the advice with industry awareness.
If law firms want to partner with clients, they have to be active listeners who understand and deliver that service. That’s value, and it generates client loyalty. The benefit of client loyalty is twofold: When budgets get slashed, those firms that deliver the greatest value are the ones that make the proverbial cut. Even better, loyal clients recommend those lawyers to their colleagues and peers. To achieve that in this current highly competitive space, look at your most important relationships and assess whether you are providing proactive and collaborative service.
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