The latest post from Jim Hassett’s blog Legal Business Development.
Agile is a highly flexible approach to project management which law firms are just starting to use. I’ve written several posts in this blog about how Agile works and how some lawyers are applying it to improve legal efficiency by focusing on two key questions:
So when I heard recently that one of our clients was using Agile techniques to increase innovation in their marketing and business development department, I immediately scheduled an interview with Brenda Plowman, the Chief Marketing Officer (CMO) at Fasken Martineau, an international business law and litigation firm with more than 700 lawyers.
The Fasken Martineau marketing and business development department includes people operating from eight offices, six in Canada, one in the UK, and one in South Africa. Plowman has worked in the department for more than 10 years. When she was promoted to the CMO position in July 2015, she noted that:
Plowman decided to start by adapting two Agile-related concepts: hackathons to creatively generate ideas for improvement and scrum to deliver them and “make sure we were actually accomplishing what we had set out to do.”
Hackathons originated in the software development world and consist of intense meetings in which groups of programmers and others collaborate intensively to solve a particular problem. With the help of a consultant, Plowman adapted the hackathon concept to legal marketing, and in June of 2016 they held their first three-hour hackathon with the team (two sessions with multiple locations involved in each) aimed at coming up with creative ideas to improve marketing efficiency and results on a specific topic. Candidly she admitted that:
They created a list of key areas “in which we wanted to improve what we had been providing previously and increase the value we were delivering to lawyers.”
One of the unique aspects of these hackathons is that they were led by the Manager group. Historically, real opportunities for leadership and development were only handled by the Senior Marketing Team (the Director level). That team was committed to developing their Managers and creating opportunity for their growth and development. The Managers were empowered and did a great job working with the teams and bringing the recommendations forward to the Senior Marketing Team (SMT). This aspect is key in Plowman’s vision to leverage the talent on her team.
In addition, the marketing and business development team has started a significant transformation with many changes in place. The Directors have taken on pieces of this transformation and are leading this change with Plowman. There are a lot of moving parts and demands on the team. This led Plowman to adapt another Agile software development technique: scrum. Initially she provided the Directors (the SMT) a copy of the book Scrum: The Art of Doing Twice the Work in Half the Time as part of the “book club” for this group. After the SMT read it and met on it during an in-person meeting, they then expanded to the Managers as a part of their development and a way to encourage them to innovate and drive their project forward. (This book is an excellent resource for law firms and I will write a separate blog soon describing its key concepts.)
This has now evolved into a 30-minute weekly telecon held every Monday by this group to discuss four substantial projects and several other key initiatives that the team is working on (including digital transformation and social media), in which Fasken’s marketing and business development department is concentrating its efforts to become best-in-class:
The group is using some of the techniques from the scrum book to establish and measure specific goals for the next 30, 60, and 90 days. The Monday meetings are organized around three key questions familiar to anyone who has ever been involved with scrum:
One result of the Monday meetings is that, “People collaborate to identify obstacles. It’s also been really helpful for me as the leader of the group because I learn how I can expedite what needs to get done this week.”
This initiative is very much a work-in-progress, but participants in the weekly meetings have already produced results. “Scrum has helped us to go faster, do more, and get obstacles out of our way. It’s increased transparency, which drives efficiency and effectiveness. And it’s created cultural change within our team. The learning is coming faster and faster.”
Plowman and her team would like to expand the program in the coming year to include lawyers. She predicts that the next steps will be even more exciting “when we get to working with our lawyers and going through the process together with them.”
By Jim Hassett and Jonathan Groner
This post summarizes the long-term experience of Judith Droz Keyes, a partner at Davis Wright Tremaine in San Francisco who completed the program in 2014. Judith specializes in labor and employment law. Her practice includes extensive counseling as well as experience in the courtroom and before mediators.
Judith first signed up for the program when a number of clients asked her about LPM, especially in connection with RFPs. At the time, she frankly wasn’t sure exactly how LPM worked, so she asked her practice group leader whether it made sense for her to get certified. The program was approved and the firm paid for it.
This program is offered via distance learning, conducted by phone and email, and organized into two modules. In Module One, participants review over 300 pages of readings from 10 project management textbooks and answer 18 essay questions about how these concepts apply to their practice. One of Judith’s Module One answers was so interesting that we ended up including it in the recently published fourth edition of our Legal Project Management Quick Reference Guide. (See page 90 for the section entitled “Process improvement to improve associate and paralegal time entries.”)
In Module 2, participants apply the concepts in their practice. Judith developed an “Employment law task list for a pre-complaint demand” (which is also reproduced in the Legal Project Management Quick Reference Guide on page 63). Her short-term goal – to take a more systematic approach to a case she was working on – was met. Her long-term goal – to simplify these task codes and get them adopted firmwide to improve client satisfaction, budget predictions, and profitability – has proven to be more elusive than she originally hoped.
One of the challenges Judith faced in getting other lawyers to accept her approach was the elephant in the room for all attempts to increase efficiency: compensation. As long as lawyers are paid more for billing more hours, efficiency is a two-edged sword. While reducing hours is often essential to make work profitable for the firm, it is almost impossible to motivate lawyers to spend fewer hours if they will be paid less as a result.
A few years ago, Jackson Lewis made headlines by announcing that associate pay would be tied to measures of client satisfaction and efficiency rather than the number of hours billed. In our view, this is the wave of the future for successful firms. But until firms make this transition, some aspects of the quest for efficiency will face resistance.
Another barrier to widespread adoption is that many lawyers believe that they are already LPM experts. After all, they’ve been planning budgets, scheduling tasks, managing teams, and communicating with clients for their entire careers. While it is certainly true that they have been doing these things well enough to succeed in the past, it does not mean that the same techniques will lead to success in the future.
Almost everyone agrees that the legal profession is changing. Clients are becoming more demanding, and competitors are improving LPM to meet client needs. These days, to retain current clients and win new ones, law firms must apply a new and more systematic approach to LPM. Those who fail to do so will be left behind.
Judith says that in the two years since her program concluded, she has continued to apply many of the lessons she learned in both in her litigation and non-litigation matters. For example, she now develops comprehensive project plans in advance of starting work on any major matter. This change has helped increase client satisfaction and profitability, especially on her fixed fee matters. She’s also learned not to worry about all the possible ups and downs and the unexpected events that can happen during a matter, such as colleagues taking leave or new people joining the firm.
These days, Judith also devotes more energy to communication issues: “Who needs to communicate what to whom and when?” When something as drastic as a final deadline for a court filing changed in the past, there was not always consistent communication about that deadline and how to work toward it. One thing she has done as a result of her LPM training is to plan ahead more consistently regarding all deadlines, communicating very clearly about who is responsible for the completion of each task, whether it’s a partner, associate, paralegal, or in-house lawyer for the client.
Nobody ever said LPM would be easy, and it would be a gross exaggeration to say that certifying a single lawyer will ever change the culture of an entire firm. But it has made a significant difference in the way Judith and some of her colleagues practice law at Davis Wright Tremaine.
I’ve said it before and I’ll say it again: As legal competition continues to get tougher, it’s more important than ever to focus on protecting relationships with the clients you already have. What will you do in 2017 to protect your top client relationships? In the current competitive environment, no client can be taken for granted, no matter how long you have worked for them. If they are already happy with your service, what could you do to make them even happier? If you’re not sure, ask them. And then do it.
The first Wednesday of every month is devoted to a short and simple reminder like this to help lawyers increase efficiency, provide greater value to their clients, and/or develop new business.
In the fifth edition of The Strategy and Tactics of Pricing, one of the most widely respected texts in this field, Thomas Nagle, John Hogan, and Joseph Zale noted that:
The problem of salespeople discounting too deeply in order to close deals is also common in other businesses:
Nagle’s text goes on to describe five basic concepts that can be used in any profession, including the law, to improve the way prices are set:
Nagle makes special note of the value of an endorsement from a client known to be discriminating. For example, in the health field, Kaiser Permanente has an excellent reputation for being an informed buyer. As a result, “When other hospitals and health maintenance organizations (HMOs) learn that Kaiser Permanente has adopted a more expensive product or service, they assume that its price premium is cost-justified” (p. 75).
But whatever price strategy a law firm uses, the simple fact that they are paying more attention to this area will have positive effects. In their book, Law Firm Pricing: Strategies, Roles, and Responsibilities, Toby Brown and Vince Cordo give this example:
This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.
If law firm management has trouble defining profitability, it can hardly be surprising that lawyers are confused by the concept. Several of the AmLaw 200 firm leaders I interviewed for my book, Client Value and Law Firm Profitability, expressed frustration with the implications, including these two:
In the interest of improving understanding, Stuart J T Dodds, the director of global pricing and legal project management at Baker & McKenzie, has proposed in his book, Smarter Pricing, Smarter Profit, that when lawyers price matters, they focus on his simple 1-3-4 Rule™:
Dodds goes on to explain that these numbers are an approximation and that the precise relationship depends on the firm’s margin (p. 38). He even provides a table showing exactly how discounts from 1% to 20% reduce margin for firms whose margin before discount ranged from 20% to 50%.
But for the vast majority of lawyers, the 1-3-4 Rule™ will be enough and will be a great way to simplify a mathematically complex relationship.
Smarter Pricing, Smarter Profit goes step by step through everything lawyers need to know to survive and prosper in today’s rapidly changing marketplace. It is divided into four main sections: set the price, get the price, manage to the price, and review the price. So setting an initial price is just the start of the process. LPM is vital for actually living within that price and collecting profit. Dodds notes that:
Taken together, all of the observations in this discussion of pricing could be interpreted as reflecting a glass half-empty (so much remains to be learned) or half-full (firms are moving quickly to focus more on the pricing function). It may make you feel better to know that the law is not the only profession that could greatly improve its pricing strategies.
This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.