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Recent Trends in Legal Services New Business Competitions Slide 1

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Recent Trends in Legal Services New Business Competitions Slide 1

  1. 1. Recent Trends in Legal Services New Business Competitions Presentation by Ann Lee Gibson, Ph.D. By Invitation of LexisNexis Martindale-Hubbell At Simmons & Simmons London June 7, 2007
  2. 2. Recent Trends on the Client Side
  3. 3. HOURLY RATE REDUCTIONS LAW FIRM CONVERGENCE APPLIED TECHNOLOGY WORK PROCESS REENGINEERING PERFORMANCE MEASUREMENTS VALUE-BASED BILLING RISK/REWARD SHARING Source: A New Era—The DuPont Legal Model , page 17 Productivity Curve ENHANCED PRODUCTIVITY STRATEGIC PARTNERSHIP
  4. 4. More RFPs issued lately <ul><li>In the last 2 years, most Am Law firms have received 2 to 3 times more RFPs than before. </li></ul><ul><li>RFPs are being issued by banks, manufacturers, pharmas, telecoms, investment funds, etc. </li></ul><ul><li>Clients now start with a short list of firms. </li></ul>
  5. 5. RFPs expensive for clients too <ul><li>A few bad consultants are out there advising companies – creating RFQs (not RFPs) that don’t distinguish among firms and too-long, onerous processes. </li></ul><ul><li>Some companies are fascinated with really bad Excel worksheets as RFP response templates. </li></ul><ul><li>Recent RFP horror stories – consultants fired and rehired, RFPs with hundreds of questions, no interviews conducted, winning firms fired months after being hired, etc. </li></ul>
  6. 6. Clients want … <ul><li>Lower legal costs </li></ul><ul><li>Great firms, not just hot lawyers </li></ul><ul><li>Legal knowledge systems </li></ul><ul><li>Improved legal processes </li></ul><ul><li>Lawyer diversity </li></ul>
  7. 7. Recent Trends on the Law Firm Side
  8. 8. Entrepreneurs still distinguish themselves <ul><li>Those with inside knowledge have a big advantage. </li></ul><ul><li>Savvy solutions (not just qualifications) can beat incumbents. </li></ul><ul><li>Still boils down to sales ability – however that translates well to the client. </li></ul>
  9. 9. Firms investing in tactical competitions resources <ul><li>Proposal writers, editors, project managers </li></ul><ul><li>Researchers and competitive intelligence analysts </li></ul><ul><li>More business development managers </li></ul><ul><li>Expertise and qualifications databases </li></ul><ul><li>Proposal templates and boilerplate </li></ul><ul><li>Proposal and document automation software </li></ul>
  10. 10. Firms starting to get more systematic with competitions <ul><li>Is this RFP worth the effort? </li></ul><ul><li>If we do decide to compete, what should we do first, second, third … eighteenth? </li></ul><ul><li>What role must firm management play in determining pricing decisions, business conflict assessments, staffing? </li></ul>
  11. 11. Firms still not strategic enough <ul><li>How does this RFP (and this client and this type of work) align with our business plan? </li></ul><ul><li>What is the firm’s appetite for managing its business plans? </li></ul><ul><li>Who in the firm is answering the hard questions: </li></ul><ul><ul><li>Where is the money? </li></ul></ul><ul><ul><li>Who’s got the most interesting work? </li></ul></ul><ul><ul><li>What are clients paying the most money for? </li></ul></ul>
  12. 12. Pricing still hard to talk about <ul><li>Most firms discount fees, even those that deny it. </li></ul><ul><li>Hourly rates are still rising – many Am Law firms’ top partners’ hourly rates pushing $1,000 / hour. </li></ul><ul><li>Clients still lobby for alternative pricing, but most accept discounted hourly rates and volume discounts. </li></ul>
  13. 13. What firms are doing (a little) better <ul><li>Research and competitive intelligence – everybody’s doing research, and some firms are actually developing actionable intel. </li></ul><ul><li>Interviews – create two-way conversations about this client’s issues. </li></ul><ul><li>Proposals – offer solutions and legal approaches responsive to this client’s challenges. </li></ul>
  14. 14. What firms still need to (greatly) improve <ul><li>Don’t wait for RFPs – go pitch your best clients now. </li></ul><ul><li>Decide if RFP is worth the effort. </li></ul><ul><li>Interview prospective client to learn vital intel before they compete. </li></ul><ul><li>Use RFP opportunities to pitch higher value work. </li></ul><ul><li>Debrief all competitions, win or lose. </li></ul>
  15. 15. Download at www.annleegibson.com

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