How Lawyers Can Build Great Business Skills
Firms want fee earners to be more than reliable technicians. They want professionals with commercial nous who can make sound business development (BD) decisions based on intuition rather than just analysis.
But not everyone knows instinctively what constitutes good BD. And what works for one firm may not work for another. So, how can you develop that instinct?
To be successful in BD, lawyers need more than an elevator pitch or endless rounds of coffee catch‑ups. And they must move away from a transactional, win-at-all-cost, salesy approach (which turns many professionals off the idea of BD anyway). A smarter approach is to focus on purposeful engagement that is aligned with the ambitions of your practice and your guiding values.
Lawyers at all levels, from recent graduates to senior counsel should understand how and why firm strategy works. The bedrock of this understanding is knowing why financial management fundamentals matter.
That’s why high-performing firms develop smart practitioners early. They don’t wait until employed lawyers progress to partnership to explain practice fundamentals like pricing strategy, cost of production, WIP and debtor management, realization of effort and time capture.
A firm with skilled, commercially savvy practitioners will outperform a firm with highly intelligent but commercially naive lawyers every day!
How to hone your business instinct
It’s no longer controversial to argue that technical experts such as lawyers must have a good understanding of their firm’s business model and strategy if the business is to thrive. But in developing their own personal approach to business building activities they must know how it compares with the approach of other providers in the market. They must know also how it resonates with clients, and how it will be amplified by the firm.
Regardless of your firm’s management model, it’s how all these parts work together that matters.
A fundamental component of your commercial acumen as a professional is understanding the financial mechanics of your practice. Why is pricing pitched at certain levels? What are the costs of production? What is the bottom-line impact of shaving time off a quotation or discounting fees to get a pitch over the line? How do margins differ between scalable and one-off projects? And what’s more important - file velocity or volume?
The other part is BD. It encompasses activities to generate business from new client relationships, expand roles with existing clients, and develop new services or products. BD works best when it compliments other components of your business – including the firm’s business model and competitive strategy, and efforts to cement its reputation as a firm.
That’s why I regularly team up with Sam Coupland, from FMRC - this region’s leading legal practice management firm - to present a two-part workshop on the financial and BD considerations for building a legal practice.
Sam deals with the financial side, covering each of the components that drive the profit of a practice, how money flows (and where it leaks), pricing, and the common behaviours of the most profitable practices.
On the BD side, I connect the profit drivers, examine how to position service offerings, and ways to develop further business.
Together, we apply tested decision-making frameworks that make sense of the moving parts, complex issues and multiple time horizons inherent in the business world – and help crystallise ideas about developing a practice.
Equipping professionals for success
Understanding a firm’s financial and BD strategies makes it a little easier to decide which clients or needs to serve, where to invest discretionary time in building networks, where to position and promote a practice, how to prospect for the right new business, and how to pitch with purpose. It’s important for firms to help their employees gain this understanding.
As the godfather of modern business strategy, Michael Porter (1996), said,
“Employees need guidance about how to deepen a strategic position rather than broaden or compromise it. About how to extend the firm’s uniqueness while strengthening the fit among its activities.”
Young professionals are anxious about doing their best. So, give them the know-how to prioritise rather than run themselves ragged. Hone their commercial acumen and do away with hand-holding.
There will always be trade-offs when it comes to executing a business plan – circumstances may not allow you to do everything you planned. But having an informed view of your closest, most addressable wins is at the very least handy – and can help to define your firm’s competitive advantage.
That’s where our ‘Business Skills for Lawyers’ workshop can help.
Want more? Accelerate your practice development with these sessions
I attend hundreds of seminars, webinars and training sessions every year. Some are fantastic, delivering insights and action points in an engaging and energising way. Others are, well, extremely forgettable – and even regrettable.
In my Practice Accelerator Series, I hand-pick the very best webinars I have had the privilege to see, and my most popular courses, and deliver them straight to you. While my primary focus is on law firms, professionals working in other complex business-to-business sectors will also find them useful. There’s even a money-back guarantee!
Over the next four months, I’ll be bringing you more engaging webinars to help you take your practice to the next level. Click on the images below for more.
Further Reading
Dixon M, McKenna T, Channer R & Freeman K (2023) What Today’s Rainmakers Do Differently Harvard Business Review, November-December Issue
Coupland S (2020) Setting, Measuring & Coaching High Performance
Maister D (2004) The Anatomy of a Consulting Firm
Nanda A & Das Narayandas D (2021) What professional Services firm must Do To Thrive, Harvard Business Review, March issue
Porter M (1996) What Is Strategy? Harvard Business Review, November-December Issue.
Sue-Ella’s Articles
The Key to Successful Practice? Stop Focusing on Winning Work.
Sue-Ella is the Principal of Prodonovich Advisory, a business dedicated to helping professional services practices sharpen their business development practices.
She works with professional services firms that focus on positive client relationships, and with individuals who want personal, intelligent support.
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