One of the more interesting take-outs from an article (‘The Rise of in-house counsel: What does this mean for law firms?‘) published on the Australasian Lawyer website today – on the rise of in-house counsel numbers in #Auslaw – is the following comment by Katherine Sampson – managing director of Mahlab Recruitment:

“It’s not necessarily that they’re [in-house] going to a competitor firm, but they are going in house…”

To me this statement rings alarm bells and reads:

“your client has just become your biggest competitor!”

So, what steps should you be taking when your client has also just become your biggest competitor for that work?

Here are 5 things you should be putting in place immediately:

1.  Build your client intelligence: First off, as is the case with any competitor threat, you need to know what your competition is doing, when and how. In short, you need to know:

• what work your client is now doing internally and what work they are still willing to send out. After all, there is little to no point marketing to a client for their compliance work if they have just hired a new in-house compliance officer and are now looking to do 95% of this in-house.
• what your client is doing in the marketplace and what their expected short and medium term needs are likely to be.

There are a number of different ways you can get this information, not least of which is getting your marketing and business development team to work more closely with your knowledge/library team, but the most reliable way you will obtain this information is by asking the client! This means that it is now more important than ever that you attend client briefing sessions and that you implement (if you haven’t already) a formal client feedback program.

2.  Build your own internal intelligence: At the same time as asking your client what work they are doing internally and what they’re still willing to send out (and to whom!), work with your finance department to check your own internal systems and databases to see what you are currently doing for the client. In addition to helping you to see what you are doing for your client, this information should also help you identify what work you do that might be under threat. Keep in mind that you may need to reforecast future revenue budgets if a revenue stream you currently have comes under threat from an in-house hire.

3.  Add value: Information you receive from your client and from your own internal intelligence should help you to add real value to your client’s business.

For example, in the Australasian Lawyer article, Tim Orsman of Simpson Grierson, says

“in-house clients are having to manage with tight budgets and demonstrate value to their organisations”

which means:

“…that they [firms] are thinking really carefully about the most efficient ways to resource particular types of work.”

Well, if, following discussions with my client, I know:

• (i) this to be true,
• (ii) that it is driven by budget, and
• (iii) that this is a short-term problem;

then:

• (iv) can I answer this problem by offering a secondment arrangement?

4.  Become a centre of excellence: if you know your in-house counsel clients have budget constraints, then without doubt one of the best ways you can help is to become a centre of excellence. In short this requires you to leverage off the knowledge and resources you have. Build best practice case studies. Create market leading precedent documentation. And make this available to your client in an easy to obtain format (website, toolkit, etc.). If done right, you can even charge a premium for this service!

5.  Stay in touch: Last, but not least, do not hide behind your phone in your office hoping that it will ring one day! Those days are well and truly gone. These days, you need to be out and about. And here’s a thought: if you know your in-house client has budget pressures and staffing issues, why don’t you offer to go and work at their premises 1 day a week. Not on a secondment arrangement, but one where you just sit in their office and work on other matters and if they should have a problem, they can just come by…

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