Building Enduring Client Loyalty: A Guide for Lawyers and Their Firms

Building Enduring Client Loyalty

A Guide for Lawyers and Their Firms

Author

Susan Saltonstall Duncan

Managing director

Sian O’Neill

Building Enduring Client Loyalty: A Guide for Lawyers and Their Firms is published by

Globe Law and Business Ltd

3 Mylor Close

Horsell

Woking

Surrey GU21 4DD

United Kingdom

Tel: +44 20 3745 4770

www.globelawandbusiness.com

Printed and bound in Great Britain by Ashford Colour Press Ltd

Building Enduring Client Loyalty: A Guide for Lawyers and Their Firms

ISBN 9781787424708

EPUB ISBN 9781787424715

Adobe PDF ISBN 9781787424722

Mobi ISBN 9781787424739

© 2021 Globe Law and Business Ltd except where otherwise indicated.

The right of Susan Saltonstall Duncan to be identified as author of this work has been asserted by her in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this publication may be reproduced in any material form (including photocopying, storing in any medium by electronic means or transmitting) without the written permission of the copyright owner, except in accordance with the provisions of the Copyright, Designs and Patents Act 1988 or under terms of a licence issued by the Copyright Licensing Agency Ltd, 6–10 Kirby Street, London EC1N 8TS, United Kingdom (www.cla.co.uk, email: licence@cla.co.uk). Applications for the copyright owner’s written permission to reproduce any part of this publication should be addressed to the publisher.

DISCLAIMER

This publication is intended as a general guide only. The information and opinions which it contains are not intended to be a comprehensive study, or to provide legal or financial advice, and should not be treated as a substitute for legal advice concerning particular situations. Legal advice should always be sought before taking any action based on the information provided. The publishers bear no responsibility for any errors or omissions contained herein.

Table of contents

Acknowledgements

Part 1. Introduction

Part 2. The loyal client framework

I. ‘Loyalty’ as defined by clients

II. Clients as loyalists

III. The competitive landscape and how to stay differentiated

IV. The loyal client life cycle

V. Customer experience – going beyond exceptional service to earn loyalty

Part 3. A roadmap: getting started on the right foot with new clients

I. Building the foundation of being trustworthy and trusted

II. Understanding clients

III. Onboarding new clients – establishing mutual expectations and protocols

IV. Seeking client feedback and insights to improve long-term loyalty

Part 4. Developing loyal client relationships

I. From expert to trusted partner and business adviser

II. Developing and nurturing long-term relationships

III. Maintaining and deepening client relationships remotely

IV. Addressing challenging or difficult clients

V. Client account management and key client teams

VI. Succession planning – retaining clients over the long term

Part 5. Earning loyalty through value, innovation and collaboration

I. Adding value for clients

II. Initiating innovation and aligning value

III. Client convergence and preferred provider panels

IV. Cross-serving clients (aka cross-selling)

V. The role of collaboration

VI. Committing to diversity to earn loyalty

Part 6. Interviews with industry leaders and innovators

I. Jeff Carr, former senior vice president and general counsel of Univar Solutions and FMC Technologies, and inventor of the ACES Model

II. Mark Chandler, executive vice president, chief legal officer and chief compliance officer, Cisco Systems, Inc

III. Vincent Cordo, former central legal operations officer and global sourcing officer, Shell Oil Co; now chief client development and relationship officer, Holland & Knight

IV. Christopher Marston, founder and CEO, Exemplar Companies

Part 7. Conclusion

I. Healthy client roadmap: 25 tips to keep clients happy, satisfied and loyal

Part 8. Appendices

Appendix I. Covenant with counsel

Appendix II. Guidelines and procedures for outside counsel

Appendix III. Steps to conducting effective client interviews

Appendix IV. Sample client relationship and feedback questions

Appendix V. American Bar Association Resolution 113 to help promote diversity in the legal profession survey

Appendix VI. Case study: Kristen Cook, associate general counsel, 7-Eleven, Inc and SEI Fuel Services, Inc; and winner of two ACC Value Champion Awards

Notes

About the author

About Globe Law and Business

Endorsements for Building Enduring Client Loyalty: A Guide for Lawyers and Their Firms

Susan Saltonstall Duncan has always been a leader in our industry, guiding law firms and other service providers to understand and deliver on a true value proposition. She has made a name for herself as a practical, thoughtful leader focused on ensuring that clients are ‘delighted’. Susan has insight ranging across the legal landscape, grounded in real-life issues and actionable advice. Building Enduring Client Loyalty brings together Susan’s counsel and leadership and, given the environment we are working in currently, her advice is even more relevant and needed. As clients search for their footing in the modern world and turn to their legal providers for far more, Susan’s advice is timely and focused. She covers how to build a framework that ensures the right client focus but she also includes incredibly important advice on issues such as succession planning and onboarding new client relationships. Of particular note, Susan includes a ‘healthy client roadmap’ that lays out the core principles and practical steps to making us all more client-focused and driven to build client loyalty. I highly recommend Building Enduring Client Loyalty to legal service providers in all industries.

Lisa Damon, Partner, Seyfarth Shaw LLP

Building Enduring Client Loyalty reflects Susan’s considerable knowledge and experience, keen insight and deep legal industry connections. It is an easy-to-read, concise yet thorough and practical tutorial on a most important and timely subject for law firm leaders to understand and drive within their law firms in order to succeed and grow in today’s challenging and competitive legal marketplace.

David Foltyn, Chair and Chief Executive Officer, Honigman LLP

Susan Saltonstall Duncan is the undisputed master in capturing and articulating the keys to leadership in law firm/client relationship management. As someone who studied and coached firms on these issues long before others found it fashionable, she has both a long view and a wide lens on the law firm business model and what makes their client relationships successful. No one is better positioned to understand the realities of client loyalty and the relationship qualities that engender it (or diminish it). In this Special Report, readers will be privy to her treasure trove of strategic principles and practical tactics: I find her work in the areas of succession planning, ‘distinguishing’ value (in a marketplace full of excellent but fungible service providers) and life-cycle conversations about expectations and collaboration particularly valuable. Given ongoing disruptions to the law firm business model, rapidly changing client expectations and increasing competition from other providers (from the law department itself, to newly established law companies), how could a law firm leader (or future leader) overlook the opportunity to leverage Susan’s wisdom?

Susan Hackett, CEO, Legal Executive Leadership LLC and former general counsel of the Association of Corporate Counsel (ACC – from 1989–2011)

Enduring client relationships are the key to success for all law firms. Building Enduring Client Loyalty is full of practical insights for creating and maintaining these relationships. Lawyers looking to build their practices would do well to read this book.

Tim Mohan, Chief Executive Partner, Chapman and Cutler LLP

This treatise by Susan Duncan, and her collaborators, is an exceptional in-depth and invaluable resource for general counsel, managing partners and their lieutenants in developing sustainable working relationships with their law firms, suppliers and clients. The timing of this publication could not have been better given the current environment. As Building Enduring Client Loyalty suggests, building strategic long-term relationships is the key to success. Everyone within the firm, including the senior partners and ‘rainmakers’, must put their self-interest aside and do what is in the best interest of their client and the firm. At DuPont, we emphasised the importance of investing in each other’s success, which this publication does so well.

Thomas L Sager, former General Counsel DuPont and creator of the DuPont Legal Model

Building Enduring Client Loyalty distils a host of best practices and insights that teach us that client loyalty is less about what clients give to us than what we give to them.

Gary L Sasso, President and CEO, Carlton Fields

Acknowledgements

My sincere gratitude goes to the colleagues below, and to others who preferred not to be identified by name, for sharing their valuable time and insights with me. Given that the topic of this Special Report is client loyalty, I felt that it was essential to weave the ‘voice of the client’ into the content. We all have much to learn from their experience and perspectives as innovators and leaders in the profession.

• Lucy Endel Bassli, former assistant general counsel for legal operations, Microsoft; now founder and innovation coach, trainer and consultant, InnoLaw Group; author of The Simple Guide to Legal Innovation and online courseware Modernizing Your Legal Practice .

• Toby Brown, chief practice management officer, Perkins Coie.

• Amanda Bruno, chief business development officer, Morgan Lewis.

• Jeff Carr, former senior vice president and general counsel, Univar Solutions and FMC Technologies.

• Mark Chandler, executive vice president, chief legal officer and chief compliance officer, Cisco Systems, Inc.

• Kristen Cook, associate general counsel, 7-Eleven, Inc and SEI Fuel Services, Inc.

• Vincent Cordo, former central legal operations officer and global sourcing officer, Shell Oil Co; now chief client development and relationship officer, Holland & Knight.

• Tom Flynn, general counsel and vice president corporate strategy, Budderfly.

• Heidi Gardner, distinguished fellow, Harvard Law School Center on the Legal Profession; faculty chair, Harvard Law School Accredited Leadership Program and Smart Collaboration Master Class.

• Maureen Harms, associate general counsel and managing counsel, 3M Co.

• Melissa Lauderdale-Ward, chief of staff to Thomas O’Neill, senior vice president and general counsel, Exelon.

• David Mack, senior vice president and chief legal officer, Hartford HealthCare.

• Christopher Marston, founder and CEO, Exemplar Companies.

• Catherine Moynihan, associate vice president, legal management services, Association of Corporate Counsel.

• Larry Richard, founder, LawyerBrain.

Part 1. Introduction

Many lawyers today still aspire to be a trusted adviser to clients and enjoy long-term relationships with them. However, building and maintaining loyalty has become much more difficult. For a decade or more, all sectors of the economy and society have experienced rapid transformations in relation to automation; technological capabilities; artificial intelligence (AI); blockchain and big data; globalisation and trade wars; medicine and telehealth; privacy and cybersecurity; talent engagement and competition; climate change; political unrest; and regulatory and compliance risk. The world seems to be in constant flux, presenting both threats and opportunities to businesses, families, communities, institutions and our way of life itself.

The business environment has been rocked further by the COVID-19 pandemic, which has caused disruption and volatility due to short and long-term effects that have upended the economy, social and business norms and activities through forced quarantines and medical crises. Law firms have been seriously tested through all of this turmoil. Many firms have proved agile and adaptive, but ultimately have not fundamentally changed their approach to client problem solving, service delivery or business models. The question now is whether and how relationships will be maintained, and whether loyalty between a client and a law firm will still exist in the ‘next normal’ environment.

I think there is a tremendous opportunity now for firms to build client loyalty. When clients are in pain – whether related to economic impacts, diversity and racial inequities, H1B visas or whatever they are struggling with – their lawyers can help them. Lawyers need to call their clients and offer to help. Clients still value relationships a lot. They like doing business with lawyers they like and who have saved their bacon in the past. Unfortunately, many lawyers and law firms are missing this opportunity to deepen loyalty, as they still are reacting and not proactively reaching out.

Toby Brown

Chief practice management officer, Perkins Coie

Client loyalty is increasingly difficult to define, earn and sustain. Heightened focus by clients on value; on efficient, cost-effective and innovative service delivery; and on doing more in-house and through automation has made it more difficult for law firms to maintain their positions. Firms are seeing increasing numbers of requests for proposals (RFPs) and increased competition from law companies, technology providers and clients themselves. Clients now employ procurement and legal operations professionals, who many law firms see as a threat to their relationships with in-house lawyers, because they oversee the law firm selection process and the pricing of fees.

Until a decade or so ago, law was primarily a relationship business, in which clients hired lawyers with expertise and experience in specific areas as needed. They retained advisers who they liked, often had friendships with and who treated them with respect. Today, clients still want to be loyal to their outside lawyers; but lawyers often make this difficult by ignoring client needs and the increasing pressures and changing environments in which clients operate.

This Special Report explores the full spectrum of relationship and service components that contribute to client trust and loyalty. Many clients – especially those with large in-house legal teams – have tightened their standards and expectations of law firms in terms of efficiency, cost-effectiveness, value-based pricing attached to outcomes and how services are staffed and delivered. Relationships still matter; but the personal aspects of relationships must now be accompanied by value pricing and value delivery. We hope that each of the chapters and topics, checklists and market insights in this Special Report will help lawyers and their firms to hone their relationship and delivery approaches to deepen their relationships with clients and earn their enduring loyalty.

Part 2. The loyal client framework

I. ‘LOYALTY’ AS DEFINED BY CLIENTS

The word ‘loyalty’ and the concept of loyalty mean very different things to different people. Some believe that ‘loyalty’ is a term better used to describe personal relationships, whereas ‘trust’ and ‘stickiness’ are more appropriate words in the business context. Because this Special Report explores how firms can build loyalty with their clients, we begin with the views of clients on how firms can both earn and erode their loyalty.

1. Lucy Endel Bassli

Former assistant general counsel for legal operations at Microsoft; founder and innovation coach, trainer and consultant at InnoLaw Group

I define ‘loyalty’ as having a deep level of trust with another person, for whom you are willing to stick out your neck. You go through ups and downs together and enable each other to succeed; you both have skin in the game and are willing to work on issues together. There is no loyalty between a company and a law firm; it all comes down to relationships between individuals, and sometimes those relationships go beyond those two people creating a sense of entity loyalty (the hardest kind to maintain).

Loyalty is still very personal, but is supported with substance. I will default first to my personal relationships with an outside lawyer. I give them a chance first and might guide them towards how to deliver work more efficiently to help them win the engagement. But there is a tipping point where I say, I love you, I appreciate you, but if you don’t change, I cannot keep sending you work. Relationships do matter; but now they must be accompanied by evident quality legal work and objectively defined successful outcomes.

History, longevity and deep relationships still are very important. One firm has been representing us for over 100 years and it still does cutting-edge work for us in labour and employment and regulatory work. We turn to this firm often for major litigation, and several of its lawyers serve as trusted advisers to a number of our executives and senior lawyers. They are on our panel because they were willing and able to negotiate rates enough, and they also share our values on diversity.

Head of legal operations, Fortune 100 company

2. Jeff Carr

Former senior vice president and general counsel of Univar Solutions and FMC Technologies

The differentiator for me, and why I am loyal to a firm, is culture. This is reflected in the chemistry, relationships, commonalities and connections I have with legal service providers – whether lawyers or other professionals. There has to be a cultural affinity and alignment with my providers, where their principles and mine mesh. One of my most loyal relationships I have had with an outside lawyer is with someone who says, I wake up every day thinking about how I can get your company out of litigation and help it stay out of litigation. He understood better than anyone I had ever come across that we didn’t want to be in litigation.

3. Mark Chandler

Executive vice president, chief legal officer and chief compliance officer, Cisco Systems, Inc

The ‘loyalty’ construct doesn’t really resonate with me as motivation to make me want to work with a law firm and continue working with a law firm. Some factors that do drive ‘stickiness’ with my law firms include the following:

• Are they willing to say when they can’t do the work?

• Do they have an appreciation of the business context I’m in? Do they understand the business decisions I am making, so they aren’t just answering a legal question – they are answering a business question? I’ve described my job as giving commonsense business advice informed by a knowledge of legal principles. I use law firms to make sure I get the black letter of the law right, if I’m not sure or confused about it. The great law firms will take it one step further and help me answer the business question.

• Am I getting value for money and how do I know? Are they willing to work on a basis that is tied to my success – not that they bear my business risk, but that they put their money where their mouth is in terms of outcomes? This is particularly true in the litigation space. How much of your fee are you willing to take on outcome? I’ve moved almost everything of significance to a fixed fee. Mine is a big enough company in volume that if one deal doesn’t work out, the next one will; and as long as they are making money, they’re happy. It has to be fair and be a partnership. That really builds loyalty, because