Lawyers’ business development challenges are predictable. Unfortunately, they create many themselves, due to well-intended but undirected activity that reflects ignorance of what it actually takes to generate the right kind of opportunities, and to convert those opportunities into high-margin clients of the type that lawyers find professionally and financially rewarding.
As a result of an outdated conceptual framework, lawyers have incorrect expectations about the scale and scope of any training undertaking, with the result that both lawyers and their firms are reluctant to invest sufficient time or money in training and coaching.
In simple terms, lawyers expect the BD “fix” to be tactical, painless, and of brief duration, rather than transformational, of longer duration.
This means that minor adjustments to their approach, or tweaking some techniques, won’t get it done. Often, a complete reconstruction is needed, beginning with replacing an outdated conceptual framework with one aligned with today’s mature, competitive market.
Two main challenges
The law firm business model requires its revenue generators to have a far more comprehensive array of capabilities than do their corporate clients, who embrace far greater division of labor. Here are a dozen major capabilities required of a serious law firm rainmaker, which are segregated as Getting Chosen (converting opportunities) and Getting Found (generating opportunities).
Logically, we must first improve a lawyer’s ability to get chosen, i.e., to convert opportunities they have now. The opportunities may not be exactly the type the lawyer wants, and there may not be as many of them as she'd like, but the firm and she have already expended time, money and effort to produce these opportunities. (Plus, if they waste opportunities, they sure don’t need more of them.)
This requires shifting lawyers’ perspective away from the habit of trying to prove the superiority of their expertise and solution and convince prospects to choose them, which triggers buyers’ defenses, in favor of using their existing “lawyering” skills to help a group of decision stakeholders make a trusted decision.
Once they can reliably convert opportunities, they’ll need to develop a dependable source of new opportunities, but not just any opportunities. These will no longer be random occurrences, but instead will be by strategic intent, and they will be predictable for reasons explained below. You can imagine the positive impact that would have on a lawyer’s confidence, standing among their colleagues, and enjoyment of their profession.
Reading the following, lawyers will understand the “what,” but will struggle with the “how,” which requires training and coaching to master the mindset, sequencing, and language for each of these major skills.
Sales: Getting Chosen, Converting Demand Into High-Margin Revenue
Gain an initial stakeholder’s willing participation in a sales investigation that
reveals the strategic, operational, and financial consequences of that problem, and the implications for that stakeholder’s career, then
facilitate them declaring the perceived economic impact, expressed in dollars. Done properly, this “Cost of Doing Nothing” discussion causes the prospect to conclude that that it’s imperative that they take action to solve the problem, and it sets up a huge ROI ratio that assures pricing power for the lawyer.
Identify other stakeholders that constitute the Sponsorship Group, i.e., the critical mass of decision-making authority, and an internal champion within that group
Motivate your initial stakeholder to identify the Sponsorship Group members and likely Champion
Recruit the Champion while discouraging the initial stakeholder from proceeding without you
Facilitate and manage a group-decision process within the Sponsorship Group, led by the Champion, that yields a sustainable decision
Learn and master the group-decision process
Coach the Champion to apply the group-decision process
Specify a solution and cost, establish ROI, and manage or oversee successful implementation
Confirm the stakeholder group’s agreement with the Cost of Doing Nothing
Before discussing solution details or proposing any solution, test stakeholders’ receptivity to solutions you’re considering proposing
Test your pricing strategy/scheme/philosophy before discussing specific pricing
Get the stakeholders to co-author your price so that they’re invested in it, feel ownership of it, and will defend it against subsequent challenge by others
Close by using stakeholders’ declarations as foundation/justification, and shift the burden of justification away from you and onto the buyers
Obtain matter performance feedback, references, and referrals, and supply intelligence to the firm to inform marketing strategy and investment
Marketing: Getting Found, Identifying and Stimulating Demand
Unfortunately, few lawyers have a vibrant sales pipeline filled with prospects who have a concrete reason to buy, or even to make time for additional lawyers, so we must embark on opportunity generation in parallel with opportunity conversion. This is a more strategic marketing effort that progresses more slowly than the sales effort. It’s a rigorous discipline that most lawyers have no exposure to or experience with, so it takes time for them to understand it and get the hang of it. Too many firms and lawyers abandon the training before this can bear fruit.
Identify an opportune market segment based on a prevalent, high-impact problem that the lawyer solves, and that differentiates that lawyer from competitors
Discipline yourself to abandon any focus on your firm, your skills, your expertise. Focus instead on the client’s world, problems, opportunities, etc.
Recognize and pursue the advantage of relevance, i.e., associating yourself with a problem that buyers must care about, instead of identifying yourself in legal-service nouns, e.g., “litigator,” “M&A lawyer,” etc.
Demonstrate “different-ness” instead of arguing “better-ness.” A percentage of prospects will consider your different-ness to be better.
Profile optimal prospects within the segment who have a meaningful stake in that problem
Develop sharp focus by segmenting and stratifying markets according to logical demographic criteria, e.g.,
“larger than $___ million, probably have in-house capability;”
“smaller than $___ million, can’t afford us,”
“domestic only, no international operations,”
“more/fewer than ___ employees,”
“growing at ___% per year,” etc.
Refine your target using psychographic criteria, e.g., “execs feeling pressure of media scrutiny re: issue,” etc.
Create provocative, sustained electronic communication that establishes “thought leadership” around the high-impact problem among those stakeholders, and motivates them to pay attention to, and remain engaged with, the thought-leader lawyer
Examine your matter history to see if there’s a pattern that suggests an opportunity.
Research those clients’ industry to identify emerging problems/issues that look like they may have a long shelf life.
Speak with stakeholders to test your problem thesis and modify/refine it while learning industry insiders’ vocabulary and expressions so you’ll sound like an insider.
Build a network of insiders who match your specifications by requesting referral to others who can offer informed opinion.
Distribute that communication continuously in channels trusted by profiled stakeholders
Use the firm’s PR resources intelligently
Communicate with media channels effectively
Identify and join relevant LinkedIn groups. Form your own groups.
Write relevant articles and blog posts, and syndicate them via social media and in relevant LinkedIn groups
Cause prospects to form “virtual relationships” with the lawyer’s ideas
Communicate consistently and frequently to demonstrate your commitment to the market, and your understanding of what’s important to insiders
Participate in resulting online discussions to maintain your presence and leadership
Make direct contact with relevant stakeholders to learn the company-specific version of the industry-specific high-impact problem
Approach stakeholders via LinkedIn
Email stakeholders to request they share their thoughts about your problem/issue
Arrange short phone calls to solicit views
Solicit network-building referrals
This list of 41 attitudes, beliefs, steps and skills is representative, but nowhere near exhaustive.
Few firms or lawyers are aware of these because, during the high-demand Seller’s Market, they weren’t really required. When everyone was buying, social friendships and casual business contact afforded sufficient proximity to be considered for work. Since buyers’ legal service purchasing levels were consistently high, they had the luxury of spreading work around to a number of lawyers with whom they had relationships. This gave rise to lawyers’ belief that “it’s all about relationships,” and the practice of “random acts of golf and lunch.”
Each of these boldface items is a macro, with subordinate items that require many specific skills to accomplish them. Developing each skill requires:
Education to produce understanding
Training to produce functional capability
Coaching to apply the skill successfully
Sufficient application and repetition to produce experience, reliable capability, and the confidence to apply it in high-stakes situations (and not revert to comfortable habits)
To accomplish this complex mission, BD trainers and coaches must overcome formidable, entrenched obstacles:
Ignorance: lawyers’ lack of appreciation of how much the game has changed, and how much they must change in response
Low priority: lawyers’ belief that business development is not a mission-critical component to their job, but an extra, their lowest priority, worthy only of “extra time”
Low activity level: Because BD is a low priority, most lawyers allocate little or no time, and have very little meaningful interaction with legitimate prospects. It’s hard to get good at something that you do little of, and long intervals between opportunities to apply the skills being taught make it hard to recognize patterns, or develop any continuity or confidence.
Lack of accountability: Most law firms don’t measure or manage BD performance, other than economic results during year-end compensation considerations. This makes it OK for lawyers to keep putting off intended actions, do the minimum, or do nothing.
Misaligned reward system: Lawyers are rewarded for billable hours and cash flow, which encourages short-term behaviors and discourages investment that doesn’t have immediate payoff, such as skill development.
“Legal-centrism”: Lawyers see the world in terms of “legal problems” and legal services. They struggle to recognize that legal matters derive from business activity or behavior, and therefore that demand is reasonably predictable. Many see them as standalone considerations, which makes it hard for them to interact with, and be seen as relevant by, line-of-business executives. This limits their contact to the Legal Department, which is crowded with all their competitors.
Limited business exposure, acumen: Many lawyers have limited their attention, reading, and exposure to topics related to the technical practice of law. Too few have much interest in business per se, so they have limited awareness of business trends, operations, or strategy (which constrains their context and perspective, and causes clients to list “lack of understanding of my business” as a top complaint). Despite nominally being business owners, many partners have limited experience with, and framework for understanding, business practices in general and business development principles and practices particularly.
Human nature: All people naturally resist change of any type.
Personality: Lawyers resist change more than the general population. They score very high on the Autonomy and Skepticism scales, and low on the Resilience scale. The combination causes them to be very risk-averse, makes it hard for them to request or accept advice or coaching, and discourages them from trying new approaches and techniques that may not succeed, or that they fear could make them look foolish.
The foregoing describes lawyers who think they want to be serious rainmakers. However, once they know what it actually takes, many decide that they don’t want it enough to pay the price.
The "why" behind the "what" and the "how"
Over the past 25 years, law firms have spent a lot of money, time, and effort trying to mold lawyers into rainmakers. They’ve tried lots of different strategies and approaches, depending their leadership’s seriousness of purpose and commitment.
How well have these investments worked out? That depends on what success criteria you assign, but most knowledgeable observers still estimate that the percentage of rainmakers remains unchanged at 5%-10% of a firm’s lawyers.
Why has so much money and time produced essentially no additional rainmakers?
I’ll argue that it’s because most training programs are under-informed about:
the actual standards of a legitimate rainmaker,
where the firm’s lawyers are in relation to those, and
what it actually takes to get from where they are to where they want to be
So, what does it mean to be a rainmaker? At most firms, anyone who generates revenue above a certain dollar threshold, reasonably consistently year-to-year, is considered a rainmaker. However, this simple standard is incomplete. A “rainmaker” is someone who each year produces gross sales revenue:
above a certain dollar threshold,
at the prescribed profit margin,
from predictable sources,
based on a defensible position in a specific market segment
"...at the prescribed profit margin"
Firms compensate partners on gross sales volume (criterion #1), with no consideration of selling “at the prescribed profit margin.” In any business, this encourages widespread discounting by salespeople. After all, even for sales professionals, it’s easier to offer a discount to get the sale than to establish value. Among untrained lawyers, who don’t know how to sell value, and for whom there’s no penalty for compromising profitability, discounting is almost guaranteed.
Neither firms nor lawyers measure or manage Cost of Sales, which is an important component of profitability. If they did, they wouldn’t tolerate lawyers’ widespread practice of random marketing and sales activity, too little of which has any strategic foundation. Once again, compensation practices reinforce bad habits. Lawyers are rewarded for activity, not outcome, so activity is what firms get. Unfortunately, most of that activity is for its own sake, to fill in required fields under the non-billable marketing hours column. I see names in lawyers’ pipeline reports that have been there for years, despite never getting any business from them. “Relationship-building” is acceptable justification. This reflects legacy attitudes and beliefs left over from the 25-year bull market for legal service that ended in 2008, when having a relationship often was enough to get work. Since the shift to a Buyer’s market, that correlation no longer exists.
"...from predictable sources"
Many partners got their revenue generation experience and success in the high-demand Seller’s Market conditions mentioned above. Firms’ legacy rainmakers (by the volume criterion only) have a random mix of disparate matters from a polyglot of unrelated clients, and little idea where they came from or why, or where future business will come from. They’re just out there forming and sustaining relationships, hoping that things will continue to work out.
As a result, they don’t understand either the nature or degree of change required to succeed in the lower-demand, higher-competition Buyer’s Market, conditions that will prevail for the balance of their careers.
"...based on a defensible position in a specific market segment"
Another legacy of the bull market is that most lawyers are identified merely by practice label, e.g., “litigator,” “real estate lawyer,” or “corporate lawyer.” According to martindale.com, that makes them one of 300,000 litigators, 180,000 real estate lawyers, or 170,000 corporate lawyers. Practice-area labels communicate no value at all, and provide no differentiation unless you’re already one of a small handful of lawyers who are considered Top Five or Top Ten in your specialty.
To attract and hold clients’ and prospects’ attention, lawyers need to establish relevance, which means associating themselves with a business problem that drives demand for their expertise, and earns them an entre’ into the existing business conversation. Few lawyers understand this concept, or know how to go about doing this. It’s actually simple to do, but it takes time, effort, and coaching.
Lawyers’ capabilities in relation to these standards
Acquiring competency is different than education, which is merely absorbing information and understanding, without any working application of it. Law school is education; lawyers learn about the law, but not how to apply their knowledge.
Competency requires you to apply knowledge through challenging attempts. It’s the doing of the thing. For example, I can explain business development techniques, but unless lawyers practice them, they’ll never be competent.
If we're blissfully unaware of our ignorance, there's little we can do about it, and no reason to care, much less to seek help. Therefore, one of the first steps to acquiring new skills is to become aware of what you don't know. This discovery can be uncomfortable, as is the beginner’s experience of not being very good at what you're trying to do.
Law firms and lawyers are unaware of these considerations, so both are operating in the Unconscious Incompetence stage of the competence cycle, i.e., they don’t know what they don’t know.
The Four Stages of Competence model a person's path from ignorance to mastery.
Anyone exposed to a new idea or skill begins at Unconscious Incompetence, and must progress through the four stages in sequence. One characteristic of Unconscious Incompetence is unfounded overconfidence in our innate ability to perform, due to ignorance of what it actually takes to perform. Since we don’t recognize a deficiency, we have no appetite for training or coaching. Why would we need it?
This is why so few lawyers are eager for BD training and coaching, and why so many training programs fail despite lawyers claiming they want training. They think that, to generate business, all you have to do is show up, form a relationship, and business will come. How hard can it be?
They only think they want training -- because they don’t know what training will entail. When the program begins and they realize they have to embrace change, take risks, allocate time, practice, and seek coaching, they opt out or go through the motions. Only those who have concrete outcome goals that matter to them, for specific reasons that they can visualize and explain, exploit the training and succeed.
Many lawyers view the prospect of BD training the way a six-year-old views the prospect of attending First Grade. It's scary and uncomfortable. “I don’t want to go around and meet new kids. I want to hang out with the kids I know.”
To succeed, or even to stick with it, they must not only have a good teacher, but they also must have support at home, with parents and siblings showing interest in their schooling and how they’re doing. You can chastise or penalize for failure, but that’s not the same as showing genuine interest in their progress. Otherwise, peer influence reigns. “The kids I know don’t do homework, so I won’t either.”
In a law firm, that translates to, "All the other lawyers are just billing hours, so that's what I'm going to do." Unless leadership and peers reinforce and encourage progress and commitment, lawyers will drop out of BD programs the way ignored kids drop out of school.
Everyone likes attention, interest, and encouragement. When it comes to BD, too few lawyers are getting any.
Stage 1: Unconscious Incompetence
This stage means, "We don't know that we don't know." We’re naive, complacent, unaware that knowledge and skill requirements have changed. We make unconscious errors.
Lawyers have awakened to the criticality of having their own clients, and they know they’ll no longer simply waltz in the door. Reluctantly, they go to networking events, hoping something good will happen, having no idea why they return empty-handed. They know that something isn’t working, but have no idea what it is or how to fix it. They don't know what they don't know.
Stage 2: Conscious Incompetence (The beginners’ mind: "We know that we don't know.")
At this stage, lawyers know that something isn’t working, but have no idea what it is or how to fix it. Often, their trial-and-error experiences bring about this awareness. They’re aware of their problem, and may understand what’s needed, but have no knowledge or confidence in how to get it.
Discouragement shows up here. There’s much more to business development than they realized, and they don't really know as much as they thought they knew. Realizing that their actual ability is limited, especially when compared to their previously naive expectations, their confidence drops, and they may feel overwhelmed by what seems to be a vast knowledge area they can't quite grasp.
How long they’re stuck in this state depends on factors such as the degree to which they accept their incompetence, their determination to learn and, if they have a coach, his ability to simplify everything. Some can’t get to this acceptance, and they tend to abandon the training.
Stage 3: Conscious Competence (Learning, effort, tutelage, and mentorship)
Through learning, at this level lawyers acquire rainmaking skills and knowledge, put them into practice, get coaching and feedback, gain confidence, and work on refining their skills. This process often goes in fits and starts as they learn, forget, plateau and start anew. (See also, The forgetting curve)
After enough effort, training and repetitions, they’ll acquire proficiency, but it doesn’t come automatically. They know what they know, and can apply it as long as they concentrate and focus. They have to think their way through what feels unnatural and foreign. Repetition, practice, coaching, feedback, and experience are necessary to advance to the final learning stage. Practice and coaching are key. Without them, they may progress to Stage 3 but will struggle to reach Stage 4, and may regress to Stage 2 or abandon the training entirely, regressing to old habits.
Stage 4: Unconscious Competence (second nature, intuition)
In this final stage, the lawyer has internalized BD knowledge and can apply it without thought or concentration, completing the tasks with grace, speed, and confidence. The skills are so practiced that they’re automatic and come naturally, as second-nature as walking, and the lawyer will know it so well that they usually can't articulate it to others.
A note of caution:
People at Stage 4 can become complacent. Learning ceases and unconscious competence may evolve to ignorance of or blindness to new methods, technologies, etc. The expert loops back to unconscious incompetence.
This describes many successful rainmakers, who acquired their (presumed) unconscious competence under conditions that no longer exist, which makes them unconsciously incompetent relative to today’s conditions.
As mentioned, there are plenty of people who become so instinctual at a particular skill that they forget the theory - because they no longer need it - and as such make worse teachers than someone who has good ability at the conscious competence stage.
Many expert practitioners who try to become conscious of what they do in order to train others find that their performance degrades, much the way athletes talk about their performance being compromised by thinking about what they're doing instead of just doing it. This is why training and coaching is an uncommon skill, and why it’s rarely a good idea to expect successful rainmakers to train others. Often what you end up with is a lesser business developer and a poor trainer.
Those who can both do and teach occupy a fifth stage, known as "reflective competence," in which you're able to toggle back and forth between the unconscious competence necessary to be an expert practitioner, and the conscious competence needed to be a teacher or trainer, without degrading the practitioner skills.
Mismatched training expectations
Because neither law firm leaders nor their lawyers understand and apply all four of the rainmaker standards above, it's very difficult for them to know what skills are required for lawyers to reach them. How can they specify program expectations? I'm not a lawyer. Imagine me trying to specify and qualify a litigation training program.
A common scenario is where no training expectations or goals are specified.