preparing for clementi by 6Y0V811

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									   Preparing for Clementi
   - are you ready to compete?




Peter Scott
PETER SCOTT CONSULTING

www.peterscottconsult.co.uk
Challenges now facing law firms

   The economy
   Government cuts
   New competitors in the market
   The P I insurance market
   Increasing regulation and compliance
   Technology
   The changing needs of clients
   A fragmented profession



Given these challenges, never has the need to be
more competitive been so great
The need to be more competitive
“Competition is a process by which …


    services that people are not prepared to
     pay for

    high cost methods of production and inefficient
     organisations

    are weeded out and

    opportunity is given for new…services methods and organisations to be tried” *



Could this apply to the legal profession today?



*Everyman’s Dictionary of Economics – A. Seldon and F. G. Pennance 1964
Your future market competitors?
       ABS - owned wholly / partly by non-lawyers with deep pockets?
       MDP - owned by lawyers and other professionals?
       Highly developed ‘traditional’ law firms?
    -   national / regional
    -   branded
    -   strong sector focus
    -   franchised / federal models
    -   heavy investment in IT, management and infrastructure

 Combinations / variants of any of the above
 Others?

Which kind of law firm do you want to be?
The greatest danger?

- complacency!

“Our strategy is to keep a lid on
expenditure and weather the storm. We
cannot reinvent ourselves as something
we are not”

Managing Partner of a major London law firm – Autumn 2008
An alternative view…

“there seems to be a disturbing strategy of hunkering
down, cutting some fat and hoping that business will
return to normal. That is not good. The terrain will look
very different when this is over. This is not a minor blip,
but a discontinuity”

“the problem is that most senior lawyers think only two months ahead.
They have no coherent picture of the future. The planning is not being
done. And it is senior lawyers who need to be driving change”



Professor Richard Susskind – May 2009
Forward planning - focus on the
fundamentals of your business



   Your clients
   Your people
   How you can achieve your goals
The fundamentals of your business – are
you making the most of them?
Your clients
Do you know what your clients want?


Will your people deliver what your clients
want?
What do clients want?
Client feedback on one law firm

“They always try to sell to us on price – but what
we really want is to have a good job done at a
reasonable price”


How will you be able to deliver this – and still
make your margin?
Core issue is to add value

You will add value that clients care about if…

   You provide clients with what they need

   At prices they perceive to be value for
    money; and

   You do this better than your competition
Position your firm to compete



         High


Client
Perceived
         Ave                            X
Added
Value                                             Suicide
                                                  Zone
         Low
                Low                      Ave                         High

                      Client Perceived Cost
                      Bowman and Faulkner 1994 Long Range Planning
Your people
Your people?

Are you presently unable to add
value to your clients because of:

   Gaps in your skills base?
   Under performance?
   internal attitudes and behaviour?
What should your people be doing:


   better?
   more of?
   less of?
   differently?

 In particular, how should your people be using
    technology more effectively?
Making technology effective


   Technology without people does nothing
   Law firms are people businesses
   People use technology

Are your people helping you to get the most
benefit out of technology?
Your IT

   IT is a tool to be used by you in your business
    to help you be competitive
   Is it doing so?
   Do you analyse the cost / benefits of the IT
    you use?
   Could you use it better to achieve your
    business objectives?
Your business objectives


   Client service delivery
   Financial management
   Business development
   Knowledge management
   Risk and compliance management
   Others?
Encourage your people to think creatively about
how to use technology to:



   Provide better service
   Improve productivity
   Build competitive advantage
   Build profitability
How to achieve your goals?
You have developed a realistic plan, but…



This will require RESOURCE - resource which
many firms cannot realistically and at
an economic and acceptable cost provide
themselves
Is lack of resource making you
uncompetitive?

 Often a lack of resource of expertise
(client perception surveys will show if this is the
case)

 Often a lack of financial resource
(inability to invest in your people and in the
business)
Resource to enable you to…



attract and retain the best talent
Resource to enable you to…


provide clients with the depth
and breadth of expertise they

 will require
 when they need it
 where they need it
Resource to enable you to…


build the quality management which will be

required to successfully compete in the future
Resource to enable you to…


provide the necessary infrastructure to
underpin the effective provision of high quality
professional services
Resource to enable you to…


provide the necessary technology to make you
more efficient and profitable
Building resource to compete



Will you be able to build sufficient
resource on your own to achieve your
goals?
The profession is too fragmented

 Over 11,000 law firms
 Over 85% have 4 or fewer partners
 Most will not be able to compete and survive if
  they remain as they are



Size does matter
Competitive growth models?


   Organic growth alone?
   Some form of consolidation?
How can consolidation enable tomorrow’s
law firms to compete?

 Not about size for the sake of size

   A means to develop resource at an acceptable economic
    cost to each constituent firm which individual firms
    cannot on their own provide

 A better platform on which to build a more competitive
    law firm capable of succeeding in tomorrow’s legal
    market
A Vision

To build a law firm which over a given period of
time will become “greater” than the sum of the
individual firms which comprise it. This will involve
building a BRAND which can begin to compete with larger,
more developed firms for better quality, higher value
work leading to greater competitiveness and profitability.
Is that a Vision you share?
How are you planning to
compete to win?
Any questions?

								
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