A few years ago I was privy to the results of a deep analysis of an AmLaw 100 firm’s practice penetration of it’s clients. That is, the degree to which the firm served clients in more than one practice area.
It seemed a lot of opportunity was left on the table. With more than 20 practice areas listed on the website, on average the firm served the needs of its clients in 1.5 to 2 practice areas per client.
In the ensuing years it has been my experience that these numbers are representative of the entire industry. And to some degree most professional service firms are not too much different.
Big and not-so-big multi-vertical professional service firms simply don’t cross sell. Law firms just happen to be a glaring example.
In spite of touting expertise in numerous areas where business intersects with issues of law…and even in the throes of marginal revenue growth and fiscal challenges, law firms wrestle mightily with the process and practices needed to leverage and grow existing client relationships.
In virtually every business sector, existing relationships are viewed as an asset — a resource to be nurtured and deepened. And cross-served.
Granted, the issue stems, in part, from the way law firms have historically gone-to-market — that is, pass the Bar, hang a shingle, and wait for prospective clients to appear at your door. For decades this worked well. Doing business in the marketplace would precipitate a need. Clients would seek out a lawyer or a firm able to meet the need. Lawyers would respond to the need.
And then just wait for the next client to show up with a need.
Perhaps it is this reactive approach that is at the heart of the issue — a view that for decades has recoiled at the idea of proactive selling. We are professionals. We do excellent work. When the market needs the services we provide, they’ll call.
But in the marketplace of 2018, anemic penetration of even our best clients is no longer a viable strategy if we’re leaving business on the table…if it ever was.
Why don’t we view existing client relationships as opportunities worth more than an occasional all-partner lunch? Or a hastily designed pursuit strategy when one or two large practice areas are slow?
Even given the historic reactive nature noted above, it is tough to ignore the possibility that some other issues are preventing a concerted and strategic effort to connect and cross sell. Here are a handful of usual suspects:
- compensation systems that encourage silos;
- the absence of the intentional integration of rainmakers and practices across a firm;
- a lack of confidence or trust in ones partners;
- a need on the part of some business developers to guard or protect important relationships;
- a complete lack of awareness of the breadth of service offered by the partnership.
The list, no doubt, goes on. Meanwhile, it is extraordinary that we will chase anything that even hints at being an opportunity. And desperate to see some growth, we invest heavily (and often hastily) in laterals promising portable business (they often fall far short of projections), and give in to the siren call of mergers and large combinations in hopes that 1 + 1 will equate to 3.
If you’ve been around long, cross selling topic-fatigue may inhibit any creative thinking about how we might deal with the challenges, both real and manufactured, and proactively double-down on our best relationships.
But for everyone willing to suspend preconceived notions and topic fatigue, here is a simple four point approach that could — if you’re like most multiple practice law firms and professional service firms — turn up some real opportunities for growth.
- Begin with an analysis of your firm’s top clients. The number of clients will depend on the size of your firm…but think in terms of the Top 50 to 200. Note the areas in which you currently provide service, and identify where your strongest relationships exist?
- Do some basic research to identify where your best client relationships are connected to additional needs your firm is positioned to meet. This due diligence should include market intelligence as well as client feedback.
- Construct a plan to raise visibility focused on where the needs of your clients intersect with your firm’s capabilities. An efficient way to achieve targeted visibility is through a strategic content marketing plan.
- Execute a process that creates face-to-face opportunities with key relationships for the purpose of exploring this overlap. This means personal calls and face-to-face meetings.
In most any endeavor the shortest distance between the status quo and measurable growth is found by devoting appropriate attention and resources to listening and nurturing the relationships you currently enjoy.
One wonders if this might be true for law firms. And why we are so reticent to invest here.