8/9/10

Show Me the Business Side of Law Firms

Last week I spent some time meeting with a legal vendor. We covered a variety of subjects. At the end of the discussions we picked up the topic of selling technology and services to law firms. The vendor commented on how that has become a challenge because the point of contact for the sale is shifting. It is no longer clear who is the right point of contact to get to (when it's not clearly the CIO). The problem vendors have is figuring out who the new person is. They asked me where this shift was headed.
After thinking about it, I suggested that they really need to reach out to the business side of the law firm. That is where very interesting and important problems are arising for firms - where they can use some help. Things such as AFAs and LPM are front and center for firms.
Then THE question came.
Where is the business side of the law firm?
I told them I would only answer one question a day - since I didn't have an answer - since law firms don't really have a business side.
Kidding aside - this is a real problem for ... Law Firms. Who is driving the business? The Executive Director runs operations. The CFO runs the numbers. The Managing Partner (MP) runs the partnership. But with few exceptions, I do not see a defined business-driver type of position for law firms.
I did come up with an indicator for the vendor for the type of firm that will more likely have some sort of business side. Look for a younger MP.

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3 comments:

Greg Lambert said...

I think that Bloomberg was one of the first vendors (at least on the library side of things) that attempted to go around the established gatekeepers and go to the "business side" of the firms via Practice Group leaders to sell their product. Although it initially worked, the practice groups are only another cog in the mess that makes up the business side of a firm. When one cog jumps out of line, it causes reprecusions throughout the whole machine. The Bloomberg model tends to be a one-off approach that works once, but never again.

So, in a way, there is a business side... it is just a complex, slow, inefficient and frustrating side. This is one of the primary reasons that many of us say that law firms are five years behind other industries... it takes us that long to get all of the cogs to sign off on a decision.

Scott Preston said...

Great post and follow up.

My experience is that vendors are much better off going to the leader of the Admin group to gain entrance into the organization. This can be challenging when the Admin group leader is non-responsive. Sometimes the business function does not clearly lineup with the way a firm is structured so finding the right person is a challenge. But going around the Admin group tends to put the vendor in the crosshairs. It will work as far as getting an opportunity to meet with someone, but eventually that Admin leader that you went around will be sitting at the table. At that point what sometimes happens is the Admin leader does his or her best to articulate just why this solution doesn't work for the organization. So while you got your foot in the door via going around the gatekeeper, your foot is going to get run over if the product isn't the right product to solve business needs. You will not know whether the product is the right solution unless you talk with . . . you guessed it – the Admin leader.

So vendors, be careful when going around roadblocks, you might end up in the ditch.

Mark Santiago said...

As a consultant to law firms for almost 30 years the question of "who" makes decisions is always interesting and sometimes very obscure.

Clearly the ED makes decisions around the non-legal aspects of firm administration. But, those decisions are often in collaboration with the CFO and HR Director.

Most decisions concerning attorneys fall to a parter (MP, practice committee, associate committee etc.)

In general, all decisions (administrative and professional) are subject to the review of a firms management committee,

However, recently there are a few new "breed" administrators often called the COO who are non-lawyers with tremendous latitude in their decision making. They can make decisions on their own and are evaluated at the end of the year on how thinks worked throughout the year and not on an issue by issue basis.

These COO's are the wave of the future and while it may take a generation or so you will see them more and more in successful law firms.

 

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