Introduction
Some law firms have received feedback from their clients about their project management skills and have reacted to it. Other firms still think they know best what their clients want (without stopping to ask them). When I speak to such firms, I hear opinions such as these:
- “Clients don’t want to pay us for project management”,
- “Clients aren’t very good at project management, so they don’t ask for it”,
- “Our clients trust us to just do whatever is necessary and don’t want to be bothered with details”.
Far-reaching decisions about pitches, pricing, staffing etc., are made based on gut instinct, even though it is easy to find out what clients truly want and value.
The best way is to simply ask them, and the great majority of clients want to be asked. When I provide trainings for groups of Corporate Legal and law firm lawyers and speak about collecting and giving feedback, some law firm lawyer almost always asks, “But do clients really want to/have the time/want to be bothered with giving feedback?”. I always let the in-house lawyers answer, and so far, they have always responded with an emphatic, “Yes, please. I will make the time to provide feedback.” Of course, those clients assume that the law firms they retain are willing to have honest conversations about the feedback they provide and make the necessary improvements. But that should go without saying.
Another useful source of information is the LPM guide that the Corporate Legal Operations Consortium (CLOC — the global organization of in-house legal operations professionals) first published in 2017, updates on a regular basis and is easily available here. Law firms would be well advised to study the guide to find out what good Legal Project Management means to mature clients and Corporate Legal departments, and how their contributions need to fit into the matter lifecycle.
The planning and execution phase
For a quick start and orientation, let us look at the expected contributions from outside counsel during the second and third (of four in total) phases of each matter: The planning phase and execution phase.
In terms of the planning phase, some law firms might be surprised at the level of planning discipline and foresight that is expected here (to paraphrase one General Counsel: “Whatever has happened once is foreseeable”). The main deliverable during the planning phase is a projected matter plan, including the phases and tasks that are anticipated to complete the matter, which involves (my emphasis):
- the estimated general effort/costs of each(!) task,
- the underlying assumptions of each(!) task, and
- the appropriate resource matching, i.e., the right people at the right level doing the work.
In most cases, the matter plan will be either drafted by the law firm and approved by Corporate Legal, or both sides will develop the matter plan together. In any event, law firms will have to have the data points (gained from similar previous matters) and skills needed to draft a matter plan at the required level of detail.
A matter plan is not an end in itself, or a box ticking exercise, but a critical tool to reach the success criteria of the planning phase as defined by CLOC:
- Alignment between the business client, Corporate Legal and outside counsel about the scope, approach, pricing, timing, and assumptions; and
- Agreement on the metrics to be used for monitoring and reporting during the matter.
The client’s interests
When it comes to monitoring and reporting metrics, many law firms might be in for a surprise when they find out that their clients are interested in quite a few data points that law firms should be able to provide. Obviously, clients are interested in the costs of the matter and in the ongoing monitoring of the matter status by comparing costs incurred vs. work completed. However, the CLOC guide also advises us to look at timekeeper turnover, i.e., the number of times new timekeepers work on an engagement.
During the execution phase, clients need their law firms to continuously provide status information regarding the phases and tasks of the matter, in particular regarding any delays compared to the projected timeline, risks of budget overruns (by constantly comparing costs incurred with work completed), and changes in the scope of the matter. Such changes then need to be discussed and agreed on (instead of letting scope creep happen silently). The matter plan needs to be kept continuously up-to-date.
This sounds like a lot of red tape to many law firm lawyers. However, these are not ends in themselves or meaningless exercises, but tools to reach the success criteria of the execution phase:
- All involved team members and the business client are fully informed about matter progress and risks (the guide recommends updates on a monthly basis or more frequently if necessary); and
- Risks are limited due to proactive and timely identification, management and decision making.
The CLOC LPM guide clearly shows that law firms need to step up their game when it comes to collecting data points and providing them to their clients. Today, mature Corporate Legal departments are firmly anchored in data-driven decision making, and law firms would be well advised to develop the necessary systems and habits too.
Law firms have to step up their game
One obstacle to providing the data points requested by clients that many law firms still face is that such reports often have to be created manually, which is time-consuming and labor-intensive. An alternative that is preferable to increasing staff in the firm’s financial department (and thus increasing costs) is to implement technological solutions. More progressive law firms have realized how they can make good use of solutions based on e.g., Power BI. Such solutions have the added benefit of being much more interactive and visually attractive than traditional reporting.
What is more, these solutions provide many more benefits to law firms than just the ability to provide data points to clients in matters: Data points can be used to improve invoicing and productivity, offer deep insights into performance and improvement areas, and identify strategic opportunities for profitable revenue growth.
In order to reap those considerable benefits, firms have to invest in two things:
- Appropriate technology, including data models and dashboards, that fits the firm’s specific needs, market position and strategy
- Increasing partners’ understanding of how they can interpret data points, create future scenarios, and influence the performance of their teams.
Investing in technology alone will not suffice. Partners need to understand how to transfer data into insights, and insights into decisions. In our experience, firms that have started on this journey often discover — to their delight – that partners, once they get the hang of it, can become quite data hungry!
A partnership that has access to hard data and makes its decisions based on this data can reap benefits and outperform its competitors on several levels, such as e.g.,
- monitoring matters in their clients’ and their own best interests (performance, productivity, client satisfaction etc.),
- taking strategic decisions on practice group, industry and/or firm level (forecasting, pricing, staffing, project, management),
- innovating more quickly, including but not limited to tech-supported legal services and the related pricing models.