Caveat Everybody

I recently stumbled upon an alternative pricing scheme that I instinctively felt was wrong.  The details are irrelevant, but I was struck by how vastly different the attorney's point of view was from my own.  So I tried to expand my viewpoint and to see the problem from all sides.  I came up with three questions that I needed to answer and I sent them to the smartest, most knowledgeable people I know.  Their answers below:

1.      What do attorneys think they sell to clients?
·         Top notch expertise and experience in a specific legal field.
·         Expert advice, not available from anyone else in the industry, business expertise. 
·         Their special skills, unique only to them.  Or there's the old quote from Lincoln, "A lawyer's time and advice are his stock-in-trade."
·         Legal advice that is based on expertise and experience.
·         Most - Knowledge of the law.  Some - Solution to a business problem. 
·         Themselves
·         Confidence

2.      What do law firms think they sell to clients?
·         Top notch legal services.
·         Professional services, expertly crafted advice and a business partnership
·         Their name.
·         Expert legal advice that addresses client needs
·         Experts in the law. 
·         Legal Services
·         Expertise

3.      What do clients think they are buying?
·         An expensive service that they had to purchase because of their risk exposure, but would rather not… (they also think that any big firm like ours is chalk full of experts, but they know lawyer "x" from previous work and decided to stick with them.)
·         An overpriced, but necessary evil service/commodity
·         Someone who can solve their problems.
·         A way to minimize risk or to solve a problem
·         Solution to a business problem. 
·         Security
·         Solutions

Within this group of respondents there is a lot of agreement.  That may point to some underlying truths, or it may be an example of selection bias on my part. I don’t claim this is a scientific result, but the most interesting aspect of these responses is that they all indicate that each party (attorney, client, and firm) is entering into the same sales transaction with a different understanding of the commodity that is being transacted. 

It seems to me that many of the problems plaguing modern law firms may be the result of different answers to these three questions.  If I go to a fishmonger, and he thinks he’s selling fish, I think I’m buying beef, and the sign out front reads, “Fresh Flowers!”, then we are going to have trouble communicating effectively and the Fish Shop is going to have trouble staying in business.  Maybe, if we can identify a single commodity that all parties agree is being transacted at a law firm, then we can focus on building the necessary internal structures, communication pathways, and marketing apparatuses to support the sale of that commodity.

Of course, you can semantically sidestep this problem by answering all questions extremely specifically (a merger agreement) or extremely generally (legal services), but that doesn’t seem like a satisfying solution to me.  So I asked my brilliant friends one additional question.

4.      What should law firms actually be selling to clients?
·         A relationship with the client where the firm better understands the overall needs of the client (not just legal, but pricing, communications, etc.) and builds upon the relationship in a way that results in the client trusting the firm.
·         Law firms should actually be selling a relationship, and a series of tools/opinions to expedite the legal process for securities, contracts etc. and effectively manage risk.
·         Their skills as problem-solvers. Good business development and competitive intelligence is based on the premise that lawyers are not salesmen (or -women).  Rather, it shows them what the client or prospective clients problems are and allows the attorneys to showcase their skills as problem-solvers.
·         A partnership that integrates the client needs with expertise and tools in order to manage risk and solve problems.
·         Business problem solvers. 
·         Solutions
·         Relationships

A “problem solving relationship” isn’t a bad answer to all of the first three questions, but paying for a “relationship” (especially by the hour) feels a little sketchy.  As good customer service representatives, attorneys understand the importance of maintaining a good relationship with the client, but I don’t think that the relationship itself is the commodity being sold.  I think I would say the attorney and the firm are selling the client access to the collective knowledge and expertise of the firm.  The key word being “collective”.  If “collective knowledge and expertise” is our commodity, then that has far-reaching implications for the ways we communicate internally and externally, for the ways we bill our clients and pay our employees, and for the ways we manage our firms.

If not “collective knowledge and expertise”, what is the commodity supplied by firms and purchased by clients?  How would you answer the questions?

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Brian Rogers said...

Ryan: Excellent and thoughtful post. There is indeed a disconnect.

If we're really selling collective knowlege and experience and if acting more cooperatively is essential, then things are a bit grim.


Steven B. Levy, author of Legal Project Management said...

Great post, Ryan. I started to respond here but got into too much detail for a comment, so I've opened up discussion here: http://lexician.com/lexblog/?p=988.

Lilly-free legal documents said...

Ryan, that is awesome post :) I know it might sound as spam, but this blog is really great! You got both the fun and the professional side of Law and that is what appeals to me most. This post is immediately going in my Pinterest!


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