Business development is a mission-critical function to law firm success. And the coaching and training of business development skills — is vital for lawyers if they are to maximize their ability to attract new clients and build a firm.
As Isla Grant has detailed: “Business development (BD) is as much a part of modern lawyering as drafting contracts and coordinating conference calls. With ever more savvy clients demanding more legal service for their money, competition for work is on the rise. Having said that, BD requires an entirely different set of skills to fee-earning work and lots of practice.”
Some law firms don’t like to pay for business development training
The most frequent objection lawyers make to paying for strategic advice and counsel related to business development – is the not-infrequent assertion that business developers should be paid in the form of commission to “prove their worth”.
It’s an understandable objection – as the success of business development initiatives is ultimately whether they produce revenue. And should lawyers wish to only work with commission-based business developers – they can do so – as there may be some who might work on that basis (pursuant to local bar regulations). But precious few, if any, will, as I’ll explain below.
Before a lawyer boxes themselves into this “commission-only” bargaining position – it’s worth considering the landscape for advanced business development advisory assistance – and its relative scarcity and value – in the context of how many lawyers there are in the world compared to practicing lawyers – and what critical functions lawyers must learn to ensure their firm survives and thrives. With these considerations in mind, lawyers can then decide whether it’s wise to “go-it-alone” without the input of a business development professional.
Lawyer to business developer ratios are small
Even for an advanced international law firms – there are very few advanced business developers in a firm of hundreds to possibly thousands of lawyers. And in most medium to small firms – that are effectively no full-time business development professionals (lawyers there are required to do almost all business development themselves, with little to no assistance). Beyond in-firm business developers, the number of capable legal business development professionals available for independent consulting will be even smaller – compared the sheer numbers of lawyers globally. (According to the American Bar Association (ABA) – at the end of 2015 – there were over 1.3 million lawyers worldwide. And the International Bar Association (IBA) alone has 55,000 members). I would estimate based on my own observation there might be one capable legal business development professional per 1,000 lawyers.
Commission-based business development requires the support of a sales organization
If a lawyer wants to apply the market analysis that somehow their legal practice is in a position to require a business developer only work on a commission basis – that business developer would be in a position to select among a pool of potentially millions of lawyers globally. And therefore the lawyer/law firm would need to make itself uniquely attractive to warrant a business developer devoting time to their business development efforts – and hope the lawyers are capable of not only understanding the business development process – but how to most effectively support and nurture it. Effectively, the law firm would need to be ready to support a sales function, just as, say, a real estate brokerage supports their sales agents – or as any other sales-focused organization supports its sales professionals.
(I’ve done commission-based legal business development – pursuant to local bar regulations – and retainer-based business development, so I’m very aware of both options. As well, I conduct business development coaching, on an hourly or retained basis).
Commission-based legal business development would need to pay high commissions
Among the requirements any good business developer will want in a commission-only situation is proper remuneration. So, a lawyer offering a “no-compensation up-front” deal will mean the necessity of a significant amount in commission. And that figure, for a good business developer to join what is essentially a startup business venture (this lawyer-business development partnership) with no sales culture/support – would be a 50% (or co-equal cut) of compensation at the end of the deal. This arrangement would be much more attractive option than say – a few percentages of the gross receipts (remember, your firm will be bargaining here as against thousands of other firms, for the assistance of a scarce legal business developer). To the extent the law firm supports a sales function with back office and sales support, that commission percentage could be reduced. But without a sizeable commission structure, it’s very unlikely a good business developer would devote any time to your organization – as most commission sales roles, as I’ve detailed, are supported by robust internal structures dedicated to the support and success of sales professionals.
Further – most lawyers expect they will be able to charge fees for their own services. They are not depending upon a client’s business deal to be successful – for them to get paid. So why should they be taking the position that business developers do the same? I think it’s because they think this is the” real” marketplace for business development services (that they somehow have the leverage – when in fact, it’s just the opposite — as a cursory review of market realities reflects that it isn’t).
Some of your competitors will pay for business development training
Business development is a mission critical function for law firm revenue generation, and therefore, becoming better at it through training and development, is essential if your firm is going to maximize its’ success.
But if your law firm doesn’t want to pay for business development training – another of the tens of thousands of law firms – or hundreds of thousands of lawyers (some of whom are your direct competitors) – will be open to paying to be trained/coached. Why, therefore, as some law firms do, would a law firm stake-out a zero-payment policy for advice and counsel on the single most important element to keeping your law firm in business (business development skills)?
At the end of the day – law firms would be wise to understand that if they stake out a commission-only policy for busines development assistance, they place themselves in a precarious position vis-à-vis their competitors, who will often be willing to pay to learn more about business development. When they insist, however, on a commission-only scenario, they then place themselves in the position of having to convince a good business developer of why they should commit time and effort to the law firm in question. And the type of sales support necessary to attract a business developer – will be something you’ll need training and advisement to develop anyway – which brings us all the way back to square one: Good business developers are worth paying to glean their knowledge and counsel.
“You couldn’t have become a great lawyer without training, practice, and mentoring. Why struggle unnecessarily to become a great business developer on your own without training, practice, and coaching? Marketing and Sales are two separate but related professional disciplines to learn and master. Can you do that on your own? Maybe, but how much more time and effort will it take, compared to having a seasoned coach to simplify and shorten the journey?”
I have been helping lawyers and law firms for almost two decades – improve their ability to identify, pursue and capture new clients in international markets – through consulting, coaching, and training. If you’d like to discuss how I might help you improve your ability to generate more new clients, please complete the form below to arrange a discussion.