by Debra Baker
In 1964, U.S. Supreme Court Justice Potter Stewart said he couldn’t define pornography but “knew what it was when he saw it.” Something similar can be said today about the concept of value in legal services.
Ask lawyers how they define the value of what they do and most will struggle with a tangible definition. Concepts like client service, responsiveness, efficiency or just plain “good lawyering” may come up, but few can specifically define these terms.
But buyers of legal services are moving beyond the Justice Steward, “I know it when I see it,” definition of value, and law firms must prepare to respond.
While the anecdotes shared over the last few weeks only scratch the surface, the five indicators identified provide a value framework lawyers can use to create internal conversations around defining and measuring value.
This framework applies a new definition to a traditional business acronym, ROI, and provides comparative metrics that can help focus in on tangible opportunities to provide more value.
- Value tied to outcome clarity: Lawyers need to shift the focus of value away from the work they do, the purely legal solution and the rate they charge. Instead they need to better define how what they will do will help their clients’ business goals.
- Value tied to budget allocation: By understanding the way clients budget for the work they do, lawyers can get insight into the way clients perceive their role. Looking at whether the work is an opportunity to create income, minimize risk or as an operational cost will help assess price sensitivity.
- Value tied to relationship strength: Not every attorney-client relationship gives rise to the opportunity for the attorney to be a “Trusted Advisor”. Lawyers need to understand the way their role is perceived and respect that role.
- Comparative value: Lawyers v. Lawyers – With the competition for legal services at an all-time high, lawyers must be able to differentiate themselves, not just from firms who look like them but also from firms cross every law firm tier from solos to global powerhouses.
- Comparative value: Law firms v. Other services providers – Competition for a share of a company’s legal spend is not limited to law firms alone. As such, lawyers must be able to define their value proposition in ways that limits their risk of losing work to technology providers, non-law firm consultants or hiring someone in house.
Law Leaders Lab is committed to helping lawyer rethinking the way lawyers create, deliver and communicate value to clients. We invite you to join the conversation and engage with the law firm leaders of tomorrow at www.lawleaderslab.com