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N E W
Y O R K
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J O U R N A L
S P E C I A L
Law Firm Management
R epor t
www. NYLJ.com
MONDay, MAY 9, 2016
The Full-Service Client Partnership
Model: A Primer for Law Firms
By Michael R. Caplan
Michael R. Caplan is chief operating officer of
Goodwin Procter. He previously served as global
chief operating officer for the legal department at
Marsh & McLennan and global director of operations for the legal department at Goldman Sachs.
BIGSTOCK
T
he billable hour. Competition
from unexpected sources. A
consolidating industry. The
market for legal services has shifted
in fundamental ways, and its evolution presents challenges for law
firms. But change also offers opportunities. Law firms today need to
think differently, and importantly
in this market, look to differentiate
themselves.
The client/law firm relationship
is constantly changing. Clients are
increasingly focused on firms who
“invest” in their risk and their business. Those who invest will master
these relationships institutionally
and will stand apart. Some suggest
that great work at a competitive
price is all that clients want from
their law firms. All AmLaw 100 firms
do great work, but great work is not
a differentiator. Price is also not a
differentiator. The key differentiator
is something law firms talk about
all the time but rarely master—a
true strategic relationship with clients. It sounds simple, but aligning
this relationship—the priorities of
lawyer and client—is essential for
any firm that hopes to succeed in
today’s market.
When law firms treat client relationships as strategic partnerships,
flexibility, transparency and communication are paramount, investment
in risk and reward is shared, and all
firm resources are leveraged for the
client’s benefit. Only then does the
relationship grow and prosper.
In the current market, law firms
need to manage client relationships
by providing advice through two
key sources: traditional lawyering,
2) MONDay, MAY 9, 2016
or the practice of law, and through
legal operations, or the business
of law. Lawyers are the primary
resource for their clients, but a
firm’s professional staff—its operations, pricing, technology, knowledge management, human resources and marketing experts—can be
an untapped source of value, and
proactively sharing their expertise
with clients (delivering non-legal
services) is essential to broadening
and deepening the law firm/client
relationship.
Combining the practice of law
with the business of law allows firms
to provide clients with a full-service
offering and a strategic opportunity to collaborate and innovate as
partners.
This full-service client partnership
model can manifest in several ways.
Sharing PMO Strategies. Corporations have long relied on their
program management offices
(PMOs) to tackle large-scale technology projects and other key initiatives. Law firms are starting to
realize the value of PMOs as they
manage multimillion-dollar initiatives for data security, technology,
space, cloud infrastructure and
ongoing legal matters. Corporate
legal departments face the same
project management demands
around people, budgets and deadlines for IT and other projects.
Firms and in-house legal departments need more efficient ways
to manage risk and optimize their
data, and PMOs offer a welcome
resource for organizations looking
to complete projects in a timely and
cost-efficient manner.
Establishing a PMO begins by
developing a set of standardized
processes for all projects to ensure
consistency across reporting,
resourcing, timing and budgeting.
With a standard methodology in
place to manage projects, prioritize
objectives and create best practices, organizations can bring more
efficiency to each project, manage
costs and ensure consistent alignment with evolving needs.
Law firms and corporate legal
departments have similar PMO
processes and challenges, and
sharing best practices to promote
operational efficiency and consistency can help drive a relationship
from client/service provider to a
There is no magic bullet that
guarantees success, but the cornerstone for all fee arrangements is trust. Trust is essential
during both the development
and execution phases.
more strategic partnership. It can
also lead to a greater understanding of a client’s businesses, goals
and pressure points. Firms whose
professional staffs are working with
clients to help establish PMO plans
and solutions are thinking proactively and differently.
Consulting on Operational and
Technology Support. Enterprise
legal management (ELM), the
practice management strategy of
corporate legal departments, uses
software to manage internal legal
documents and workflows, generate electronic bills and invoices,
and guide decision-making through
reporting and analytics.
When a company needs help with
legal operations and technology,
calling its law firm is rarely the first
choice, or even the second. But
given the similar market challenges
firms and legal departments face,
law firms have a significant opportunity to add value for clients by
proactively sharing knowledge and
offering support in this area.
This can take many forms, such
as helping with a vendor analysis
for e-billing, or advising on matter,
knowledge or document management, or assisting with the development of outside counsel billing
guidelines. Law firm pricing managers, IT managers and COOs are
ideally positioned to help clients
with IT planning. This can include
consulting on RFPs, providing
roadmaps, introducing clients to
other clients with similar goals
and/or to those who have already
implemented comparable systems
and technology. And firms can
help with templates and process
throughout.
Creating Best Practice Panels
for Outside Counsel. One of a
legal COO’s primary challenges is
to articulate his or her department’s
value in business terms to the company’s CEO, CFO and other leaders.
As a result, legal COOs are always
eager to hear about ways to increase
efficiency and cost control in their
spend for outside counsel.
Facilitating introductions to their
peers by arranging panels, meetings
and other gatherings gives legal
COOs the opportunity to discuss
needs, share best practices and
consult with those who might have
already encountered (and solved)
a particularly vexing issue.
The information and knowledge
imparted at these events can help
legal COOs navigate the ELM sector, make strategic investment
3) MONDay, MAY 9, 2016
decisions, and help their organi- law). Goodwin hears consistently
zations evolve to the next level. from clients on the value of this
Most important, though, the law approach:
firm organizing events like these
• ati Gill, Global Legal COO and
M
is helping the client’s legal COO be
Senior Director of Government
successful in his or her job. This
Affairs at Teva Pharmaceuticals:
creates a deeper bond with the
Legal technology platforms have
client and leads to a strengthened
become critical enablers for correlationship.
porate legal groups in global
Sharing Risk/Reward Investcompanies. Having a partner
ment with Clients. Alternative
with an intimate understandfee structures, like the traditional
ing of our business needs is of
billable hour arrangement, are
extreme value for Teva Legal
about more than just price. Any
Group. Goodwin Procter helps
fee arrangement should involve
us navigate the multiple offerings
shared risk and reward, detailed
available on the market—billing,
project management and advance
matter management, document
planning, closer alignment between
review, etc. They advise on prolaw firms and clients on goals and
cesses, vendor selection and
objectives, and consistent two-way
overall implementation. Led
communication.
by Chairman David Hashmall,
Partnered investment in risk/
Goodwin Procter is an important
reward for law firms means proacpartner. COO Michael Caplan
tively pitching it to clients rather
brings indispensable corporate
than passively responding to it. It is
experience and sees applicable
work that needs to be done together,
solutions through our eyes—a
with full transparency and as part
tremendous help to integrating
of a trusted advisory relationship.
the right platforms and customThere is no magic bullet that guarizing them to our needs.
antees success, but the cornerstone
• avid Allen, Senior VP and DepD
for all fee arrangements is trust.
uty GC at MassMutual:
Trust is essential during both the
Firms that focus on operational
development and execution phases.
aspects of their relationships
It ensures a win-win engagement
with corporate clients are differthat incorporates the interests of
entiating themselves. For years,
both client and law firm, and results
MassMutual and Goodwin Procter
in value and predictability. Strategic
have worked closely together on
alignment, accurate scoping, active
transactions, litigation and divertracking and matter management,
sity initiatives. Recently, the relaand consistent and timely commutionship has been enhanced as
nication are also critical.
a direct result of both entities’
These are just some of the ways
concentrated efforts on effiGoodwin Procter is engaging with
ciency. Quite simply, Goodwin
clients to provide a full-service
demonstrates that they “get it”
approach that leverages both
by empowering their COO, Mike
lawyers (the practice of law) and
Caplan, to build the operational
professional staff (the business of
bridge with their clients by
partnering and consulting on
new challenges in the rapidly
evolving legal service delivery
model. This places the firm at a
strategic advantage in terms of
our selection of counsel.
• arren Guy, Global Legal COO
D
at McGraw Hill Financial:
Goodwin’s ability to collaborate
in the legal operations space only
enhances their overall effectiveness as a complete legal services
provider. They remain excellent
partners to us.
The benefits accruing from the
full-service client partnership
model also include enhanced business development efforts, increased
collaboration among a firm’s attorneys and professional staff, and,
as a result, a stronger institutional
culture.
Law firm partners will always
lead the client relationships and
business development work, but
the smart ones know that the folks
on the assembly line putting on the
tires are just as important as the
people selling the car. If the tires
are not on right, the salespeople
and the organization are going to
suffer.
And for law firms looking to succeed in today’s market, full-service
performance for clients is truly
where the rubber meets the road.
Reprinted with permission from the MAY 9, 2016 edition of the NEW YORK
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