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Special report: Canada – The long trail

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  • John Coleman of Norton Rose is right about "it’s a new world order in the legal business. It’s not enough to offer a discount, you need a differentiator.”

    In fact, clients have been saying this for as long as I have worked in and with law firms, which dates back to the late 1980s. Repeatedly, research I've done beginning in 1988 has clients saying they really don't see any difference between law firms, as much as they may like the one they are using. But they also say if their firm disappeared overnight, they'd probably like the next firm they used just as well.

    But if you spend any time reading law firm websites, you keep seeing the same words: Experienced. Value-driven. Client focused. You could shuffle all of the logo's and names on the home pages and it wouldn't make any difference. Worse, clients view these qualities as the price of admission. If a firm doesn't provide experienced lawyers who are client focused and value driven, they don't get asked to the dance.

    Moreover, firms need to be more aggressive in assessing the profitability of specific clients and practice areas. For one thing, as a management tool it provides much more leeway to a managing partner if a client is demanding a discount. For another, it gives the firm information about where and how to allocate resources, from people to dollars to business development activity.

    In the end, the process offers a complete picture of which clients – even types of clients – are profitable and worth developing, which are not, and ways a firm could improve its net return and partner distributions without internal divisions, squabbling or angry departures.

    Accountancies dealt with this in the 1990s and ended up making more money, and had happier clients, than ever. Law firms have been slow to adopt the management practice.

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