CRM: new options, new opportunities

“Risk management” has become a crucial area for most law firms within just a few years, even though the term was rarely heard in relation to managing a legal practice 10 years ago. “CRM” – which you can regard either as “Client” or “Customer” Relationship Management is set to become equally, if not more, crucial within just a few years, but it is difficult to know where to start. Exploring the technology options could be the catalyst you need.

We define CRM as “the strategic process of selecting the customers a firm can most profitably serve and of shaping the interactions between a firm and these customers with the goal of optimising the current and future value of the customers for the firm.”

As with Risk Management, before it matured into an essential strategy for law firms, the principles behind CRM have been seeping through for the past 10 years to varying degrees in different law firms. Now it is time to pull those initiatives together into a CRM strategy that lawyers can visualise, with coherent aims they can work towards; focusing on how the firm works with and communicates with clients.

Co-ordinating Strategies
Risk management pulls together elements of quality systems (like Lexcel, ISO and IIP), complaints handling, file management, disaster recovery, business continuity, anti-money laundering, training and professional indemnity, focusing all these initiatives on maintaining a stable environment for the firm to operate within.

CRM is similar. It pulls together many different components of recent initiatives to improve performance in law firms; for example, marketing, development of personal skills, business process redesign, market research, performance management, key performance indicators and client audits. Co-ordinating these initiatives by focusing on the impact they have on clients and business partners makes good sense.

Why Start Now?
You probably already have to some extent, but don’t call it CRM. Perhaps acknowledgement that what the client wants and that how we communicate with them is the first priority would be no bad thing? Put clients first, be proud of it and develop a stronger business as a result!

We’ve been helping firms for years on business development and most of that work has involved getting to know clients and prospects better and tailoring how services are delivered in the way they want. If you have made any attempt to tailor your services in this way, if you’ve begun to talk to clients about their business needs or your services, or have begun to evaluate your lawyers based on client satisfaction as well as performance on fees, you are already heading in this direction. But this only takes law firms so far.

Most law firms should now be considering the opportunities to improve radically and transform how they communicate and work with at least some of their clients. Radical improvements are achievable now if lawyers choose to capitalise on increasing use of the Internet for communication and of technology to manage knowledge and information.

Making the decision and giving the commitment to radical change is the key stumbling block for most law firms, largely because there is a lack of understanding of what might be possible. Also, not enough enthusiasm or angst to take the initiative - and time out to find out more; but the opportunities are there for the taking. Particularly now, as individuals and corporates are beginning to learn and experience new ways of communicating that only a small number of law firms are tapping into.

66% of households have access to the Internet
67% of people use the Internet
56% of users are on broadband

“The Internet in Britain, 2007” - Oxford Internet Institute, Oxford University

The biggest challenge in making CRM work for your firm is probably going to be getting the lawyers to change the way they think about and work with clients, to be more collaborative, more interested and more in touch with how clients think and work. Seeing what is possible with the technologies currently available now, to help develop some vision in their mind of what is possible from the outset will help you get there.

I suggest you show them some of the options now. Most will be surprised and will not have found the time to think through how this could work for them. Following our recommended steps, they can take a step back and think about how they can make these tools work for their clients, better informed on what might be possible. There will be resistance, but the people who have already taken the business this far will see more of what is possible, even if they do not buy in immediately, or ever.

Tools include software products like:

Microsoft Office SharePoint Services (MOSS 2007) which can be used to share documents, discussions, contact details, web links and much more online with clients. Then you can collaborate more together, even sharing the work in compiling and amending documents. Not many lawyers are exploring the possibilities here although some law firms and at least one legal IT systems supplier (CS Group AIM) have launched document management services using Microsoft SharePoint. But much more can be done. You may need a guide to take you through the specific options for law firms, but for information on the basic product – go to www.microsoft.com/sharepoint
Online chatting software, where you can stay connected to your clients throughout the day for informal exchanges that don’t involve confidential information. See http://get.live.com for a demonstration of Windows Live Messenger, which is free. Have you asked your clients if they use this or something similar? Would it help to keep in touch this way? Your IT manager may have some issues with the bandwidth, but are these kinds of options being explored at all in your firm? Google also provide a similar service in their Google Pack which you can download from our blog at www.inpractice.co.uk/blog
And what about setting up a blog like this so that you can regularly update your clients with snippets of information that are not too difficult to produce and maintain?
Online newsletters can help you build a loyal community of regular readers and help you track who reads what and when so you can fine tune the services you offer and who you send that information to. Not all clients want information by email, but the numbers are increasing. Anyway, I am happy if just 30% of all my clients and contacts regularly open all my online newsletters. I know who they are and I can focus more expensive offline initiatives at the rest.
However, lawyers are not taking the initiative here to anything like the extent they should. It is still not unusual for successful law firms who could do better to:

Not ask clients if they would like the firm to communicate with them by email;

Not ask for the client’s email address and add it to the firm’s database at the outset as a routine part of client and matter inception;

Not tell the client about the newsletter, the blog or their privileged access to the website.

Unless clients are told and asked about these options, neither they nor the firm will know which clients do and which don’t want information online.

Online billing and payments – which will be more attractive to clients now accustomed to managing their bank account and credit cards online. The billing process can be streamlined significantly for commercial clients with some exploration of the options, but these discussions (an important part of CRM) are not being initiated by many law firms

Next Steps
To explore the options here, we suggest that lawyers and business managers in law firms (not just the IT team) should:

Check out each of the tools we have mentioned in this article. Find out how they could possibly work for your lawyers;
Engage lawyers in a discussion of the options available, focusing on a small number of receptive clients and business partners to begin to develop a vision of how their relationship could evolve to become more collaborative in the future;
Open up a discussion with a variety of important clients, introducers and business partners – private individuals and businesses – to explore with them how the firm could work more closely and effectively with these tools and others in mind. Not limiting the discussion to just these tools though;
Begin to identify the potential benefits of developing a different way of working that involves lawyers being willing and keen to be more flexible and collaborative in how they communicate with clients. Aim to develop a vision of what the range of lawyer / client / business partner relationships should look and feel in the future. Your aim is to begin to get buy-in from some lawyers to a different kind of relationship.
Only then develop the business case for change to a more client-centric firm when there is a better understanding, amongst some at least, of what could readily be done differently to change for the better.

If you are considering a client relationship management initiative in your practice seriously, a number of your partners will have already supported a variety of projects and taken substantial steps to improve the business. Even for them, it is difficult to envisage the extent to which relationships with a substantial proportion of clients could be transformed by harnessing the potential of the Internet.

Even if they don’t adopt all or any of these tools for all clients, exploring them will act as a catalyst and make them ask questions they haven’t felt the need to deal with in the past; about how they and their colleagues could choose to interact with clients to build loyalty. It will enable the practice to become more competitive whatever decisions are made as a result.

Allan Carton, Managing Director, Inpractice Limited
Solicitor, MBA
acarton@inpractice.co.uk
www.inpractice.co.uk
Tel: 0161 929 8355
Mob: 07779 653105

Published on: 26-11-2007