brand development

“You actually need to be in Asia to understand Asia.”

“You actually need to be in Asia to understand Asia. You cannot look at it from a distance, or certainly run a business in Asia from a distance. So, unless you are actually in Asia and focused on Asia and the different markets in Asia, it’s very difficult to understand the different markets, their stages of development, and how you need to run your business in those markets. And certainly you can’t do that from London or New York. That’s a fundamental point.” – Stuart Fuller, King & Wood Mallesons

The above quote, which I couldn’t have put better myself, is from an interesting interview between columnist David Parnell and Stuart Fuller, Global Managing Partner of King & Wood Mallesons (‘Stuart Fuller Of King & Wood Mallesons, On Vereins and Succeeding in China’s Legal Market‘) posted to the Forbes website on 20 July 2015.

A lot can be said about the ‘Mallesons’ strategic approach to Asia (or, probably more to the point, the lack of it) in its days as ‘Mallesons Stephen Jaques’ – when the firm was rumoured to be heavily courted by the likes of Clifford Chance and Linklaters in the UK – but since the tie-up with King & Wood (and the subsequent merger with SJ Berwin), the firm that is KWM, as it is now affectionately known, has certainly turned a corner, got its strategy ducks lined up and come a long way.

To my mind evidence of this is clear in the following two paragraphs by Fuller:

“Secondly, it’s a business model issue. If you come into Asia and run a Western business model, then you are likely to lose money. That’s quite difficult for many of the international firms because they have such powerful and strong business models in their home markets, and they export them to the rest of the world.

Thirdly, some markets are more developed than others, so if you come into Asia and think that because the law firms are younger, that they are less developed, or frankly, in some ways less professional, then you’ll be surprised. There are firms here — us for instance — who have 1200 lawyers and 2000 people across 12 cities in China alone. We have an impressive international business in China operating at an international standard. There are a number of firms across the market like us, and I think that is a surprise to Westerners.”

Absolutely spot on!

Indeed, probably the only thing missing from Fuller is the strength that relationships play in the overall marketplace throughout Asia – both at government level and in many of the region’s family run businesses.

Then again, possibly that’s what Fuller is eluding to when he says:

“And for Western business coming into Asia, the big thing you need to know is how to get things done. The system is different. It’s the lore as much as the law.”

In any event, it is clear that KWM has moved forward a long way since 2012, and I’m not sure the rest of the pack are giving this firm the appropriate credit they deserve.

A quick test to help determine if you’re providing value to your client

In today’s legal world you often here people talking about “doing more for less” and/or that they are providing “value” to their clients, without much of an explanation as to what constitutes “value” – with the best shot usually being:

“value, like beauty, is in the eye of the beholder“.

Indeed many thousands, if not millions, of words have been written about making sure you “add value” – not to be confused with “added value”, which is a whole different subject – but very few of those written words have made any real attempt [from what I can see] to try and nail down a definition of “value” from a client’s point of view.

And while there is little doubt that every single person’s definition of value will be different – and in many cases, each individual person’s definition of value will alter depending on the circumstances they face at the time they are asked to define “value” to them – the following two-part questionnaire suggested by Nathaniel Slavin (of Wicker Park Group) in his recent post on the Bloomberg Big Law Business website, ‘The Perception of Value Differs Among Clients‘, probably goes closer than anything I’ve seen so far to answering this conundrum:

Does my lawyer understand how I define success and all the myriad components that impact that success?; and
Do they accomplish that goal in a manner, financially and otherwise, that helps us further our business goals?

And if, as a private practising lawyer, you can answer “yes” to both those questions – while you cannot be certain you are delivering “value” – you can be pretty sure you are delivering overall client satisfaction levels that are going to get you as close as you can possibly get to a modern day definition of “delivering value to your client“.

Your law firm’s brand recognition: How much does it really matter?

Earlier today Dr George Beaton (@grbeaton_law), Partner in Beaton Capital and an associate professor at the University of Melbourne, posted the following question to Twitter:

“Which firm is the ‘world’s strongest’? Skadden or Baker & McKenzie or Jones Day. Confusing”

With a twitter pic link to an article on the Global Legal Post website that contains links to the following “Related stories”:

Leaving aside the issue of financial strength, as George’s tweet clearly infers brand strength, the question I always ask when I see news items and survey responses of this nature is this:

Does it really matter?

And the answer to that really depends on what my firm’s overall strategy is.

Taking a step back, whenever I’m asked in my role as a business development consultant by law firm partners of the importance of such survey findings I will often respond by asking them the following question in return:

Imagine we are on a long distance flight on an important business route – say Sydney to London or Tokyo to New York. Now, say I give out a questionnaire to all 300 plus passengers on that plane asking them the simple question of whether or not they have heard of your firm. Would you prefer:

A. a greater percentage of passengers in first class to have heard of you?

B. a greater percentage of passengers in business class to have heard of you? 0r

C. a greater percentage of passengers in economy class to have heard of you?

Now if your firm’s business plan is to be doing “premium work for premium clients”, then my guess is you’d want a greater percentage of first class passengers to have heard of you. Similarly, if your business plan is to be working with the top ASX 200 companies, then I would hazard a guess you would want to be known by both first class and business class passengers, with the edge being on the greater brand recognition among the business class passengers. Finally, if your firm’s business plan is to be a leading B2C law firm, that I’m guessing you wouldn’t mind if your brand is widely recognised by the economy class passengers.

A very simplistic way of looking at this issue? Very much so.

But, at the end of the day, despite headlines that read ‘Top legal brands grow 45pc faster than others over last four years‘, I’m very much of the view that surveys of this nature fail to ask a more critical question, namely:

Do you regularly, or have you ever, instructed one or more of these firms you have heard of in the last three years?

Because, does it really matter if you have heard of me but never given me any work (ie, fed me)?

And all of this is before we get into the even more interesting discussion of whether or not you instruct individual lawyers (lawyer name [brand] recognition) – either at my firm or elsewhere – regardless of which firm they work for (lateral hire movements)?

After all, we have a long flight ahead of us…

I know the Burberry brand but that doesn’t mean I buy from them

I know the iconic luxury goods brand ‘Burberry’. Established in 1856, Burberry have been clothing the rich and famous pretty much continuously since. In Sydney they have a flagship store at 343 George Street. Here’s the kicker though: I have never knowingly bought anything from Burberry.

While this may all sound fascinating, you could well be asking yourself about now what this has to do with the selling of legal services? And it wouldn’t be an unreasonable thought too.

So without further ado, let’s move on to the issue at hand.

Last week saw the publication of the Acritas Global Elite Law Firm Brand Index 2014 to much fanfare. As Acritas themselves proclaim, the Index:

“…reveals the firms which are adapting most successfully to the changing market and winning client loyalty and favorability as a result.”

And while this would seem to be a pretty compelling reason to analyse the Index more closely by itself, managingpartner.com goes on to comment, according to the results of the Index, that:

“Multinational clients are more likely to instruct law firms which have a strong multi-jurisdictional presence and capabilities and a collaboratively working style and value focus”.

All I can say is – “Wow!”. If this is truly the case, then it goes without saying that the Index should be considered one of the most important and compelling benchmarks in the industry and it needs to be in the reading list of every managing partner, business development director and head of finance. Because the simple fact is, if my firm isn’t on and near the top of this list, I need to be very concerned.

But, before the panic starts to set in, how is the Index compiled?

Ahh, well here is where it seems to start falling apart. According to the Acritas website,

“The Sharpelegal Global Elite Brand Index is determined through four open-ended questions from the full survey to find out from general counsel:

the first law firms to come to mind

the firms most considered for multi-jurisdictional deals

the firms they feel most favorable towards

the firms most considered for multi-jurisdictional litigation.”

Did you notice that there was/is not a single open-ended question to the effect:

Did you actually buy legal services from this firm?, or
If you bought legal services from this firm, in how many different jurisdictions did you buy them in?, or
Did you use the same firm of lawyers in multiple jurisdictions in one transaction during the course of the last 12 months?

And therein lies the problem with the Index: while it is certainly really nice for my ego that my firm is one of the most recognised legal brands in the world (and just to be clear, I don’t actually work for the firm that came out top in the Index by some margin -Baker & McKenzie), the simple fact is that this doesn’t pay the bills.

Which brings me back to Burberry, a brand I most certainly know, would consider buying from (if I won the lottery), and feel very favourable to, but from whom I’ve never actually purchased anything…

Which ‘top’ Australian law firms are struggling to enter Asia?

The headline of the lead-off item in Friday’s (8/8/2014) Global Legal Post was:

“Top Australian firms struggle to enter Asia”

Pretty strong stuff, made all the more so by the first line of the post, which reads:

“BigLaw Australia has been ‘bitterly disappointed’ at its limited success in entering Asian markets, according to business consultant Dr George Beaton.”

The post left me wondering:

which ‘top’ Australian law firms are they referring to?, and
is it fair to say that “BigLaw Australia” has been ‘bitterly disappointed’ at its limited success in entering the Asian markets?

So, over the weekend I decided to take a look at this more closely. And, for the purposes of the remainder of this post I have limited my research to:

independent ‘Australian’ law firms (i.e., not international firms with an Australian presence),
with a presence on the ground in Asia (i.e., not looking at firms’ informal or formal referral arrangements – such as Advoc Asia, Lex Mundi or PRAC, which will likely be the subject of a future post).

Also, in undertaking this I have used the most recent ‘Top 10 Independent Australian Law Firms by Revenue’ list I could find – in this case, complied by the excellent Yun Kriegler (aka @TheLawyerAsia) in her 30 June 2014 analysts post for The Lawyer ‘Australia: medium pace’.

So, here goes:

Top 10 Independent Australian Law Firm by revenue	Offices in Asia
1. Clayton Utz*	None
2. Allens**	Beijing, Hanoi, Ho Chi Minh City, Hong Kong, Jakarta, Port Moresby, Singapore, Ulaanbaatar
3. Minter Ellison***	Beijing, Hong Kong, Shanghai, Ulaanbaatar
4. Corrs Chambers Westgarth	None
5. Gadens	Singapore, Port Moresby
6. Gilbert & Tobin	None
7. HWL Ebsworth	None
8. Maddocks	None
9. Sparke Helmore	None
10. McCullough Robertson	None

* Clayton Utz hit the headlines earlier this year for scratching it’s HK association with Haley & Co. but I’m not sure this one incident is enough to warrant a headline like that above.

** Given Allens tie-up with Linklaters, it’s questionable how ‘independent’ the firm remains.

*** as far as I can see, Minter Ellison’s Asian offices are not financial integrated with the Australian operations.

——-

So,

7 out of the Top 10 Independent Australian Law Firms by revenue have no on the ground presence in Asia at all,
for 2 out of the 3 that do have on the ground presence in Asia, it is questionable how financially linked their Asian offices are to the Australian operations, and
out of the 7 that currently have no on the ground presence, only Clayton Utz looks like it has attempted to create any on the ground presence in the past few years.

Which essentially leaves Gadens, listed at #5 on the list, as the only independent Australian law firm with any on the ground representation in mainland Asia itself (Singapore, where it doesn’t appear to have a local Qualifying Foreign Law Practice (QFLP) licence).

Overall then I think it is fair to say that that top Australian laws firms have not struggled to enter Asia – because they are simply not there in the first place and many of them have not even made an attempt to be there!

Is it also fair to say then that:

“BigLaw Australia has been ‘bitterly disappointed’ at its limited success in entering Asian markets”?

I’m not sure, because when you look at the published strategy of leading independent Australian law firms there appears to be three different approaches being adopted:

First, firms who are aligning with referral groups, such as Lex Mundi mentioned above,
Second, firms who are working off informal referral arrangements with firms operating in the Region, and
Third, firms who have decided to stay 100% Australian and are not looking at Asia in any great way for future development.

And so the honest answer is that this will take further analysis.

Now, if we were looking at how happy global firms with an Australian presence were with their Asian operations, then this would be a completely different post!

RWS_01

Let’s talk about your law firm’s “collegiate culture”

“Collegiate“:

‘consisting of several colleges or parts’

very formal: ‘sharing ideas and responsibilities with the people you work with, in a friendly way’

– Source: Macmillan Dictionary

Business development professionals, like myself, often talk about the need for businesses to have a “collegiate” culture if the business is to have any real chance of turning a profit. Obviously when we talk about “collegiate” here what we mean is:

“the sharing of ideas and responsibilities with the people you work with in a friendly way”

rather than:

“consisting of several colleges or parts”.

But for business development professionals who operate in the professional services space, the thought of a firm actually having or implementing a “collegiate culture” is more along the lines of a ‘nice to have’, than a reality.

There are lots of reasons why this is so, and to be fair most of them have more to do with the benefits and rewards system that breeds behaviour in law firms than a lack of willingness on the part of any firm to implement this type of culture.

And so it was with great delight that I read earlier this week the CEO of Shoosmiths (Claire Rowe) saying that a collegiate culture was how to keep staff happy and turn a profit.

Imagine, the nirvana of happy staff and making a profit.

Actually, where:

“We have a transparent and open environment, there are no secrets. We have very honest conversations with our people to set our plans. Our staff enjoy a set-up which means they can achieve their personal objectives in a supportive way”

it really isn’t that hard to imagine.

It also shouldn’t be that difficult to implement such an environment.

So it was with equal disappointment that I read the following day, on the same website, how DWF were to “take account of non-billable work in [their] new appraisal model” (my bold for emphasis).

I’m not sure if the management/HR team at DWF are aware quite how polar opposite their publicly stated approach is to that of Shoosmiths. And to be fair to the management of DWF, they may not have been aware when talking to the publisher of the website that the Shoosmiths story was going to be published the day before.

Regardless, the message to young lawyers is clear: At Shoosmiths we believe in transparent and open environment with personal respect; whereas at DWF if you are not billing, we will give you credit for whatever it is you have done, but we are not overly happy about the whole situation!

And it is worth noting that, from an #Auslaw perspective, it is not only the young lawyers who get this message. As far back as September 2010, Bob Santamaria – ANZ Bank General Counsel – stated in the Australian newspaper that:

“Law firms now are being run more as businesses and for profit, and that is affecting lawyers, good and bad”

going on to say:

“There will be very, very good lawyers who are jaundiced by some of that approach that is applying in the big firms.”

In other words, if you can get the foundations of your culture right – and preferably making this a collegiate culture – you are some way to attracting some of the best talent around and, hopefully by extension, some of the best clients.

I happen to agree with Bob Santamaria. Indeed, I will go one step further:

If you can get a collegiate culture going in your firm that has values aligned with those of your client, you will almost certainly be as happy and profitable as Shoosmiths.

So how collegiate is the culture in your law firm?

RWS_01

ps – if you are interested in what a firm’s values might look if they were selected by their client, Cordell Parvin’s “If Your Clients Could Choose Your Law Firm’s Vision and Core Values” is a good starting point

The hidden dangers of discounting your fees

Today’s post is a short rant about the practice and dangers of discounting your legal fees, followed by a useful collection of 20 questions I found earlier that you should be asking yourself if you are discounting your fees.

I’ll start off by disclosing that I hate it when lawyers discount their fees. I especially hate it when this is done without any request by the client – a far more prevalent practice than is perhaps admitted – or consultation with others in the firm (including the practice of discounting on other lawyers’ rates in your firm without even asking them if this is OK!).

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