Marketing and Risk Management: On Parallel Paths

Successful law firms are generally those who market their services effectively. They also seem to be able to set themselves apart from the competition and tend to manage themselves more effectively than their peers. The similarities may go deeper, however, behind the headlines and the new client acquisitions. They generally include an understanding of the value of the marketing impetus in the global operation of the firm; the importance of cooperation among lawyers and practice areas, the development and maintenance of standards of the practice and the training and upgrading of lawyers skills and abilities.

Effective marketing inside the firm requires many of the same qualities for which practice management and risk management are noted.  Although risk management is generally thought of as perhaps subtracting from the bottom line (because of the extra effort or expense it may require) the argument can be made that it serves to create an intramural environment in which a law firm can succeed and prosper. In its own way, it might be considered to be as, or more essential to firm growth and economic prosperity as an effective internal marketing concentration. Why might that be the case?

A well conceived internal marketing program requires co ordination and planning; it requires an understanding of the firm’s strengths and of the firm’s weaknesses. It requires an understanding, too, of the firm’s competitive environment: what it takes to succeed as an entity. Risk Management requires much of the same information and firm knowledge.  For a firm to practice in a safe and secure manner, structures must be in place to support and at the same time provide a degree of control over lawyers actions. Infra structure must be clear and effective. That degree of quality of management begets the kind of information required to make decisions and to react to the many external pressures upon the entity.

Creating a well designed institutional marketing program can provide a major step forward toward a firm’s risk management efforts. For many small and medium sized firms, compensation is very much up to the individual Partner. The “eat what you kill” credo is not at all uncommon and for such firms. In their case particularly, the ability to insert “cross bracing” (horizontal supports) to the practice is a critical necessity. A well conceived marketing plan does just that.

If the marketing plan is successful, so much the better. Most firms have only a small percentage of lawyers who produce the lion’s share of new business (10% of lawyers producing 90% of the business is almost the norm). So, if that number can be raised to 15% or even more, the firm is a much healthier environment and one far less “beholden” to one or two lawyers. The dynamic inside the firm is altered substantially and more balance among lawyers and practice groups is in evidence. That in turn means that there is more effort that can be leveraged to cope with common problems and take care of the common weal. The firm is healthier, more able to compete and the practice carries with it far less risk. It’s a “win-win” situation.