Like any effective Management Consulting Firm we love a good problem and in this article we want to look beyond the more common benefits of professional levels of management practices (cost & quality control, risk mitigation, effective use of resources, employee emotional health, etc. etc.) and explore how important customer satisfaction is for the success of a firm.
Failure in delivering customer satisfaction is the single biggest issue why clients leave their law firm. One study found that as many as 67% simply leave because of an attitude of indifference from their lawyer and law firm staff.
Furthermore, customer satisfaction is, at its core, the most effective factor in a successful professional services growth strategy. Not only will well served clients return with further business opportunities but more importantly they will share their experiences within their social circles. Particularly in the legal sector where clients typically choose their legal support by reputation, specialism and price (in that order) the impact of “word of mouth” is not to be underestimated.
To underline this point, research shows that the cost of winning a new client tends to be 10 times greater than the cost of retaining an existing customer and that the chances of selling to existing customers is 3.5 - 12 times higher than to new customers.
From a client’s perspective, despite successful outcomes they are often left feeling embittered about their experience due to an eroded level of trust that has been created by a lack of:
- Timely notification of significant risks and an agreement on a mitigation and/or fallback plan
- Proactive and regular progress updates
- Timely agreements on changed scope and therefore changed time and cost estimations
- Clearly demonstrated ownership of their matter and an available path for escalations
- A feedback loop where the client’s perspective on performance is actively being requested
- Prioritisation, as everything seemed urgent and chaotic without clear communication of the next steps and a general lack of direction
From an outsider's perspective our research has led us to conclude that many law firms continue to run on an antiquated “head-down” system. Prioritisation is given to fee earners’ efforts to progress on the matter objectives and the life cycle of a matter is being overlooked and not actively managed to common professional standards. Moreover, law firms are focusing much of their efforts to become the best in their area of expertise (and geography). This results in very focused and driven experts who will, as per the requirement of expertise, struggle to see the value of contributions to their client’s satisfaction beyond their own deliverables. This phenomenon is especially true the higher the specialism and expertise are required.
We feel there are significant opportunities for change across the legal sector by adopting lessons from other professional service providers. Industries such as software development, marketing and financial services are hugely commercial and driven by a strong growth agenda. All of these are investing significant amounts of their budget in satisfying their clients to ever higher levels and are reporting astounding return on investments by doing so. Section D1 of the SRA’s Statement of Solicitor Competence for example, has the hallmarks of an opening paragraph to many professional service providers’ management methodology frameworks.
“[...]Initiate, plan, prioritise and manage work activities and projects to ensure that they are completed efficiently, on time and to an appropriate standard, both in relation to their own work and work that they lead or supervise[...]”
However in practice the similarities tend to end here. Looking back at the clients perspective, we see that even though clients may have achieved the desired outcome the process by which it has been brought about has been less than satisfactory. This need not be the case. By actively managing the life cycle of the matter, utilising lessons learnt from other professional services, law firms can deliver a package of satisfaction from initiation through to closure. This client centric approach will deliver more than just end results for the client, it will engage the client in a relationship with the firm that will continue to give beyond the closure of a single matter.
With the significant changes to the legal market over the last few years and an expectation of an increased rate of change going forward, we foresee that firms embracing this challenge as an opportunity for improvement will gain a competitive edge over their peers. In the future it seems only firms that are focusing on their clients and remaining agile in their mode of operations will be able to capitalise on new levels of customer expectations.