Resting within the data you already hold in your law firm is enormous potential. Like most firms, though, you’ve probably been ignoring the massive benefits that can be gained by taking a data-driven approach.
The benefits of a data-driven approach
Having led the IT function for Australian law firms and consulted to many others, it’s apparent that many firms have no access to accurate information which could be used to support them in winning work and maintaining clients.
Even if a firm has invested in a CRM system, they often still rely on busy lawyers to manually update that system. Taking a data-driven approach to business development and client retention can remove the need for lawyers to take time out to update a CRM or client database. However, the benefits extend well beyond just that.
Leveraging accurate and real-time data presents a whole new range of opportunities. If, for example, you queried your Practice Management or CRM system to understand if the firm has a relationship with a business or contact you are looking to win work from, having no results returned may mean that the firm has had no contact. But it may also mean that no one had bothered to enter their contact into the system. By connecting automatically to the firm’s communication systems, your ability to identify a known relationship increases exponentially. Having this visibility can help a firm enormously when pitching, prospecting or looking to cross-sell into an organisation.
Managing relationships (and boosting revenue)
The relationships a commercial firm holds are critical and directly linked to revenue. Most commercial practices are fundamentally relationship-driven, so maintaining client, contact and referrer relationships are key to the commercial success of a practice.
Managing referral relationships is often very difficult, though. The revenue that a key referrer indirectly generates can be equal or greater than that of a key client. Even for those firms that capture and track referred fees on a regular basis, the challenge in monitoring fees alone is that by the time a referrer has stopped sending work it is typically too late.
Using live communication data provides immediate, real-time information so you can quickly and easily understand how long it has been since anyone in the firm has communicated or met with a key referrer. Taking a proactive approach in ensuring the time since last contact does not extend too far means that even when a firm is busy it does not overlook those relationships that are key to driving future revenue.
Staff turnover can sometimes spell problems for client relationships. Industry reports indicate that Australian firms can expect to see at least 21% staff turnover on an annual basis. With visibility over each of the relationships a key staff member holds, meetings and communication trends, a firm is in a much stronger position to retain the relationships it holds. Even for planned departures, real-time communication data can be used to set and monitor relationship transitions so they can be moved from the departing staff member to someone else within the firm.
Successfully monitoring these relationship transitions, enables the firm to maintain the commercial relationships that may otherwise dissolve after a Partner or key staff member departs the firm. Having visibility over these transitions not only applies to planned retirements, but also to parental leave, extended leave and secondments.
Improved operational efficiencies
There are not just strategic benefits that can be extracted from your firm’s data. Many operational tasks become much easier, faster and more accurate by harnessing the power of data and analytics. Having a live list of recent contacts for a group or an individual can be used to quickly and easily develop event lists or maintain accurate mailout lists.
Data: not just a big firm thing
With extensive law firm reporting and data analytics experience, our team are well aware of opportunities existing within a law firm’s communication data. This type of capability, however, is often limited to large firms with dedicated data analytics teams.
Through our experience in working with many small, mid-tier and large Australian law firms, our team developed Client Sense so that firms of all sizes could easily extract and utilise the opportunities held within the data their systems automatically generate.
Having developed Client Sense in collaboration with small and mid-tier Australian law firms, we now also work with a range of engineering, accounting, consulting and insurance practices to support their business development and client retention strategies.
At the end of the day, relationships drive revenue. Using data to protect those relationships and help your firm grow might seem novel, but it really is as practical as using financial data to manage revenue and expenses.
About the author
Steve Tyndall is the Founder of Client Sense and NextLegal. Steve presents regularly on Legal Technology with the Queensland Law Society and Law Institute of Victoria, and is a founding member of the Australian Legal Technology Association. Having led the IT function for Australian mid-tier law firms, he is passionate about helping firms of all sizes to extract the value that technology can provide. Steve can be contacted directly by email at email@example.com or you can connect with Steve on LinkedIn.