Clients want their lawyers to deliver value. Unfortunately, most lawyers seem to misunderstand what this means in practice. For example, the Lexis Nexis Bellweather Report 2016 shows that 30% of solicitors believe they offer ‘excellent’ value for money (as opposed to ‘good’, ‘average’ or ‘poor’). Only 8% of clients agree with this assessment, while 6% of clients said their lawyer returned ‘poor’ value for money.
The Bellweather Report also confirms that low prices are not synonymous with delivering value. Out of all the factors clients prioritise when dealing with lawyers, securing the lowest priced legal services is at the bottom of the list. Interestingly, lawyers also take the same view about low prices. Yet there is still a disconnect between lawyers and their clients about what ‘value’ means and whether it has been delivered.
Lawyers are not solely to blame for this state of affairs. Clients, especially business clients, can help themselves by explaining their value points more clearly to the lawyers they instruct. After all, it’s in the client’s interest for lawyers to get this right.
What do clients value when dealing with lawyers?
According to the Bellweather Report, the top five client priorities are for lawyers to demonstrate:
- A clear understanding of particular client needs
- Efficient operational delivery of legal services
- Keeping to a timetable during matters
- Keeping clients informed during matters
- Providing clients with a clear estimate of costs, or fixed fees.
The report also states the biggest gap in perception between lawyers and clients concerns delivery. Lawyers believe they deliver legal services effectively, whilst their clients disagree.
How clients can help their lawyers deliver value
In theory, it could not be simpler for clients to help their lawyers deliver value. All clients need to do is:
- Explain clearly what it is they really value from their legal service providers, including what their particular needs are
- Monitor the services received, to see if what they value is being delivered
- Provide feedback to their lawyers about how they are doing and how they can improve.
Clients not asking enough of their law firms
The 2016 Altman Weil survey of law firms practising in the United States asked firms why they are not doing more to change the way they deliver legal services. The consistent answer from law firm senior partners was: ‘because clients aren’t asking for this’.
This was confirmed in the Altman Weil 2016 survey of Chief Legal Officers (aka Heads of In-House Legal).
One of the regular contributors to the ever excellent 3 Geeks and a Law blog, Casey Flaherty, has highlighted this point (and others) in a long and thoughtful post.
It seems that in-house lawyers do not know what to ask for, how to ask for it and then monitor outcomes.
Playbook for structured and constructive dialogue
Casey has gone much further than writing a blog post pointing out the impasse between law firms waiting for clients to ask for change and clients waiting for law firms to change in response to general market conditions. He has written a detailed guide for in-house lawyers about how to ask more of their external legal advisors.
Published in June 2016, the guide is called ‘Unless You Ask: A Guide For Law Departments To Get More From External Relationships’. Written under the auspices of the Association of Corporate Counsel (ACC) the guide is a remarkable document, and not just because its free to download (you can download the Guide from the ACC site here).
Unless You Ask is a non-prescriptive playbook, designed to help in-house lawyers have constructive conversations with their external suppliers of legal services. It contains ideas, suggestions and questions to help clients drill down into whichever aspects of legal services are important to them. All aspects of legal services are covered including, to list just a few areas of particular interest to me: law firm project management, IT systems, process improvements, data analytics, and knowledge management (links are to some of my previous posts).
Unless You Ask is over 80 pages long. Its stated aim is to ‘encourage a structured dialogue to arrive at sustainable win-win improvement initiatives’ for both clients and lawyers. Needless to say, I think everyone concerned about the delivery of legal services should read it.
Why lawyers should welcome more assertive clients
Casey suggests that if clients receive poor legal advice they should change their lawyer. On the other hand if there is room for improvement in the way their lawyer delivers services, it may be worthwhile to stick with the lawyer and provide constructive feedback to help improve legal service delivery in future.
True enough, and I can think of other reasons for promoting structured and constructive lawyer-client conversations. For example, consider the concept of value pricing. For years now many commentators and consultants have been suggesting to lawyers they should move more towards value pricing. True value pricing requires prices quoted in advance of substantive work being done on a matter, with price agreed reflecting value placed on the work by the client.
Although there is a lot of literature available which explains how to assess and determine value in advance, for lots of reasons, most lawyers still appear reluctant to engage in value pricing conversations with their clients. But if clients take the initiative and explain what value means to them, then lawyers should feel much more confident about the value conversation, and any subsequent pricing to value. (A few years ago I created a video about lawyer-client conversations in the context of value pricing and you can find it on this page if interested).
Of course lawyers then have to deliver value to realise their fees, but that’s the whole point: structured and constructive dialogue, leading to value delivered and fairly remunerated.