Business Development


Business Development:

5 ways to get more clients and keep the ones you have

John C. Trimble
Columbus, OH

In these challenging economic times clients are using greater care in the consumption of legal services. As technology has made it possible for clients to request that law firms bill electronically, the business and insurance worlds have begun studying the efficiency and expense of law firms through the creation of “metrics” that can be used to grade lawyer and law firm performance. With the information that is being generated about law firm performance, clients are making decisions as to which firms to select or retain as panel counsel. They are looking at individual lawyers within law firms to select the lawyers they wish to hire and the lawyers who they will prohibit from handling their cases. They are also looking at efficiency, cost per case, and outcomes in deciding whether to grant fee increases.

At the same time that sophisticated clients have begun measuring the metrics of their law firms, they have also established litigation guidelines and budgets that are intended to enable them to manage litigation more closely. Reliable anecdotal information suggests that clients are becoming more demanding in compliance with guidelines, and increasingly they are holding law firms and lawyers accountable for budget accuracy.

It would be easy to see metrics, guidelines, and budget constraints as an intrusion into our profession and an annoying burden. However, smart lawyers understand that these aspects of our business are here to stay. If you can view these developments as an opportunity to excel and grow your business, your practice will grow and prosper!

1. Close cases as quickly as possible.

The first and easiest measurement of importance to clients is cycle time. This element is very simple: The client keeps track of the average time that a law firm or lawyer has a case open from the date it is assigned to the date it is closed. This metric is measured because businesses understand that the older a case becomes, the more expensive it tends to be. Smart lawyers and law firms understand that they should track the average age of a case, and they should use extra care to shorten case cycle times. This means that lawyers need to be attentive to case management plans, and they should do everything in their power to move a case from start to finish as rapidly as possible. Furthermore, law firms should do everything in their power to get a case closed as quickly as possible once a settlement has been reached.

2. Assign cases to the lowest competent biller.

Another important metric is case staffing. (The specific metric is usually referred to as the “effective” rate, and it represents the blending of the rates of all timekeepers over the life of a case.) Businesses and insurance companies now have the ability to look at a law firm or a litigation partner and assess whether law firms staff their cases properly and according to guidelines. They are looking to see whether work is being performed at partner rates, associate rates, or paralegal rates, and they are attracted to law firms in which cases are handled effectively by the lowest billable person. They are also now actively comparing how one firm’s “effective” rate per case compared to another in the terms of the way a firm staffs cases. Like cycle time, case staffing and “effective” rate are aspects of litigation management that law firms can easily study and for which they should establish best practices. Whether you are a partner or an associate on a file, you should be mindful that work ought to be performed by the lowest competent biller so that the effective rate for all work on the case is as low as reasonably possible.

3. Decide quickly how your client's case will proceed.

Most of our more sophisticated clients realize that very few matters go to trial any longer. Therefore, they do not view a case in terms of the activity that must be undertaken to get to trial. They are more interested in the activity that must be done to get to what is called a “decision point.” Therefore, case phasing is frequently measured. Clients prefer to see that a firm (or a lawyer) frontloads the case with the discovery and investigative activities that are necessary to allow the client to assess risks, estimate value, and to reach a point at which the client can make the decision to either settle a case or get ready for trial. Thus, lawyers and law firms who pay attention to the phasing of a case and understand the importance of getting to decision point promptly will get more work than their competitors. Furthermore, within a law firm, clients will make assignments to the lawyers who are better at case phasing than others within their firm.

4. Make sure your average case cost is competitive.

A combination of the importance of cycle time, case staffing, and case phasing is the average cost of a case. Clients are more closely scrutinizing what law firms charge on average for particular types of cases, and they are looking to see what the average cost is per case for particular lawyers within a law firm. While the case-by-case comparison is imprecise, law firms that have a volume practice can be compared to other similar law firms in their jurisdiction to see whether one firm handles cases at a lower average cost than another firm. Similarly, clients are comparing the average cost per case of lawyers within a firm. Thus, good lawyers should be aware of their average case costs and attentive to all of the factors, including hourly rate and staffing, that enter into average cost per case.

5. Compare your case outcomes to your competitors.

Another significant metric is average outcome by case. This is clearly an imprecise measurement, but companies are attempting to weight cases by case type and complexity so that they can determine whether law firms and individual lawyers are producing good average outcomes compared to their competitors in their city or geographic area. This may be the one metric that is most difficult for a firm or lawyer to control. However, to the extent that you work hard on every case to get it resolved for the lowest reasonable outcome, the better your average metrics will be.

For firms to adapt to a metric driven business world, they must begin tracking performance, and they must train their lawyers and staff. Individual lawyers within the firm need to be reminded that their case handling techniques can harm the firm as a whole, or they may be individually excluded from new case assignments. Staff members need to be reminded that there is urgency in every case in getting the case closed once it is settled.

There is plenty of software available to assist you in litigation management. Most firms have it. Use it!

Lastly, you must be mindful that some clients will tell you how your metrics look and how you compare to other firms. Other clients will not. Your opportunities for fee increases and the very issue of keeping clients is impacted by your scorecard. View it as an opportunity—not a burdenand you have nothing to fear.