Law firms "losing market share" due to inefficient CRM
1 July 2013 | By Matt Byrne
3 March 2014
24 October 2013
14 March 2014
24 February 2014
8 July 2013
Law firms are falling short when it comes to the effective management of key client relationships, new research has found.
An in-depth survey of 220 professional services organisations, the bulk of which were law firms, has revealed that six out of seven firms are failing to get substantial and sustained benefits from their client relationship management programmes (CRM) despite the large investments they have been making in them.
The research, which was conducted by the Managing Partners’ Forum (MPF) and The Thriving Company, found that satisfaction levels in CRM are also down since the last survey was conducted in late 2011.
The research highlights concerns that firms are failing to get the most out of their investment in CRM, often because of a lack of strong management.
Paul Lemon, executive director of the MPF, said: “In professional services it is often asked: ‘who owns the clients’? This year’s survey gives a very clear message: that a strategic, firm-wide approach must be employed to ensure that everyone in an organisation takes ownership of client relationships. Staff should not view them as the responsibility or preserve of only a few individuals, and senior managers must lead culture change on this matter, integrating CRM with overall business strategies to ensure that future investment is not wasted.”
CRM programmes facilitate the building and nurturing of client relationships, often making use of specialist, networked IT platforms. The idea is that this facilitates intelligence sharing about interactions with existing and potential clients, within teams and also at the firm-wide level. This in turn promotes integrated client service and supports a strategic approach to business development.
Increasingly firms are discovering that the quality of client relationships is their primary differentiator and that the reliance on old-fashioned networks of personal contacts is no longer sufficient.
As Robin Dicks, director of the Thriving Company, added: “Clients of professional firms increasingly expect firms to manage relationships effectively. They do it themselves for their own clients and notice when other firms are not making the same effort. Since the integration of firms’ knowledge and expertise is becoming more important as clients look to simplify their access to professional advice, we expect those fee-earners and firms who continue to accept ‘ring fencing’ of relationships to lose out, and lose market share.”
The report’s key findings include the fact that:
90 per cent of firms are planning to make an investment in their CRM programmes this year, and 82 per cent say they are likely to move to a new system or upgrade their current system within the next three years;
43 per cent strongly believe that in their firms, CRM is regarded as the responsibility of business development and marketing staff and 41 per cent believe this to some extent;
49 per cent of respondents strongly believe that although many staff in their organisations have been trained in CRM, they do not believe that it is relevant to them;
31per cent of respondents strongly believe that fee earners ring fence their client relationships, and 52 per cent believe they do to some extent;
Only 20 per cent of staff without direct client contact are measured on the contribution they provide to client contact activities;
CRM strategy is well-integrated and aligned with the firm’s overall business objectives in only 35 per cent of firms (down by 7 per cent since 2011).