In the nine years that I’ve been thinking, speaking and writing about law firms, I’ve assumed that the objective of sales and marketing is to initiate and nurture relationships that over time will become institutional relationships.  Obviously, I’m not the only one who has thought this way.  Virtually every lawyer and staff professional in private law firms cites this axiom:  “The best source of new business is satisfied existing clients.” 

Why, then, is cross-selling such a challenge?  Why are so few firms able to form and operate truly effective interdisciplinary client service teams?  Those of us in law firms need to be brutally honest with ourselves here:  It’s not as easy as it should be if the “satisfied client” adage is as true as we have always assumed it to be. Maybe it’s not!

No doubt, many buyers of legal services want to align with a trusted adviser outside lawyer who can act as a quarterback and draw from the resources of his/her firm to address all legal needs.  Frankly, though, many buyers do not, and they are aggressively and cooperatively disaggregating the outside-lawyer supply chain.  That fact invalidates the “satisfied client” assumption that has driven so much law firm marketing over the last 30 years.

I was reminded of this as I read Steven Lauer’s most-recent book, “The Value-Able Law Department,” published by Ark Group.  In a Chapter titled “An overview of the identification and selection of outside counsel,” Lauer writes about how many law departments are going about identifying “appropriate outside counsel.” 

“Technology,” says Lauer, “can enable a law department to review a greater number of law firms much more readily than was once possible.  Firms can be located and analyzed over the internet despite geographic separation.  Also of value is that the technology can be used to more effectively contrast the candidates so identified.  Data can be extracted from websites and entered into a database for easy comparison.”

I first witnessed this nearly seven years ago when I met, Judi Trail, JPMorgan Chase’s Vice President of Professional Services Sourcing.   She was, and is, a leader on a team that had developed, and continues to improve, a massive knowledge management system intended to provide JPMC’s inside buyers detailed information about hundreds of pre-approved lawyers across the country – information that includes billing rates, practice areas, experience, diversity profile and other relevant facts.  When a JPMC lawyer needs to engage a lawyer with a particular expertise in a particular geography at a particular price point, the system automatically produces a short list of outside lawyers who are pre-approved and in the JPMC system.  Thus, the inside lawyer maintains some discretion over outside counsel selection, but doesn’t face the daunting task of searching “from scratch.”  JPMC’s system is but one of many crafted by sophisticated buyers who are interested in hiring a lawyer, not a law firm.  These buyers are not interested in institutional relationships in the historic sense nor in being cross-sold in the way that law firms have assumed that they can execute.

While it is true that some buyers will continue to pursue institutional relationships with outside lawyers, it is clear that in “the new legal normal,” many more will not.  To me, this means that law firm marketing and sales departments need to hedge their bets by developing capabilities in addition to those aimed at achievement of institutional relationships.  Among these capabilities should be – more sophisticated understanding of in-house selection systems and processes, more sophisticated utilization of technology that complements (infiltrates, even)  buyers’ selection technologies, responding to every possible RFP to ensure saturated exposure of lawyers to buyers, development of legal “products,” and a renewed focus on each lawyer’s truly differentiating qualities.

While it’s a little disconcerting to contemplate that I’ve been operating on an at least partly mistaken assumption, it’s good to know that I still have enough career left to address some new ones.