BreakAway®

An initiative for focusing on the creation of new wealth by creating new markets, new clients and new revenue streams.

BREAKAWAY®

PROGRAM OVERVIEW

©2001 EDGE INTERNATIONAL

I. GROWTH CHALLENGES

  • TOUGH TIMES AHEAD FOR MANY FIRMS

    • The economy is slowing dramatically, many firms are carrying a larger debt load than ever before, and meanwhile RPL is flat or has been declining for 80% of firms - over the past four years between 1997 and 2000.
  • CONVERGENCE TRENDS

    • 70% of Fortune 1000 Companies plan to decrease number of firms on approved list over next 5 years.
    • 57% of Fortune 1000 Companies plan to decrease use of outside law firms over next 5 years.

  • DIFFERENTIATION

    • Law firm marketing suffers most noticeably from firms having a tough time really differentiates their practices. PWC sudy.
  • MORE LEGAL WORK IS BECOMING COMMODITIZED.

    • Within five years, one-third to one-half of your firms revenues will come from areas that you do NOT practice in today. Are you properly positioned?
  • COMPETITIVE PRESSURES OF THE INTERNET
    • Clifford Chance forecasts that online services could account for 20% of the firm's business within the next five years.

BREAKAWAY® SUMMARY

Initial Orientation

  • We collaborate in reviewing the firm's growth expectations and Edge's approach to strategic innovation.

Module 1: Breaking With Your Immediate Past
Firm Level - Current Position (Where We Are)

  • We introduce the need for innovation
  • We discover, with the partners, some areas of firm distinction and also some areas that need remedial action
  • We begin to build partner buy-in to the strategy process
  • We develop some initial action plans and an implementation schedule.

Module 2: Discovery & Foresight Firm Level - (Where We Might Go)

  • We identify the firm's culture, the partners collective appetite for growth and where they might see some unexploited opportunities.
  • We get a sense of the firm's competitive standing, special competencies, and potential areas of differentiation.
  • We explore where the future of the profession might be headed and what that means to the firm in terms of focusing our action.

Module 3: Practice Group Strategies

  • We identify unexplored possibilities arising from existing client achievements
  • We ascertain emerging and growth opportunities for each practice group
  • We develop practice group strategies and implementation plans

Module 4: Practice Group Client-Need Interviews

  • We test some of our initial thinking with real clients while also exploring their hidden and future needs.

Module 5: Exploring Growth Options - Firm Level

  • We bring all of this together to look at the vast spectrum of growth opportunities available to the firm and where we are best positioned to focus our attention and resources in order to develop new clients, new markets, and new revenue streams.

Module 6: Strategy Formulation - Firm & Practices

  • Together with the Executive Committee, we draft our strategic directions and present the recommendations and implementation schedule to a meeting of the partners.

Modules 7: Implementation

  • We identify those action items that would benefit from having consulting assistance in the implementation.

II. PROGRAM OUTLINE:

INITIAL ORIENTATION
[1/2 to one-day meeting]

Orientation:

A meeting is held with the Management Committee to obtain an extensive briefing on the firm's history, culture, growth aspirations, and expectations. Discussions would also cover the role and utilization of outside consultants, the determination of an appropriate sub-committee to assist with the strategy process, internal communications to partners, and a master timetable for future meetings.

Edge Requirements:

Set Priority

A high priority for growth and innovation motivates professionals and paves the way for a firm culture and mind-set that makes growth possible. Innovation must be seen as the core strategy. It requires the highest level of commitment from firm leaders.

Action Steps:

  • Firm management must identify innovation as one of the top three strategic drivers for the entire firm during the coming year.
  • Develop a written rationale for the innovation priority.
  • Identify an internal champion to spearhead the effort.

Initiate Goals

The firm develops a working policy to provide direction for the development of new offerings.

Action Steps:

  • Define ambitious growth goals.
  • Define desired % of revenues to come from new practices and new clients.
  • Identify the need for professionals to come up with new ways to develop new-to-the-firm ideas and new-to-the-profession innovations.

Review Existing Data

Provide available data and information covering:

  • financial performance (past 3 years), billing rates, and partner compensation system
  • organizational structure, lateral recruitment efforts, and partnership agreement
  • copy of firm's last strategic plan and comparative economic statistics
  • lists of top clients and client survey results
  • past business development achievements

MODULE 1: BREAKING WITH YOUR IMMEDIATE PAST

[1 Day Partners Summit]

Review the current state of the competitive environment in which your firm is now operating and make the case for the need to develop new directions and new growth strategies. Engage the partners in a one-day diagnostic workshop to have them individually and collectively assess 24 strategic issues that affect the firm's current and future market position. Then develop concrete action plans to address those issues that require attention and set a specific schedule for implementation. This meeting and exercise is intended to imbue partner buy-in and an understanding of the strategy process.

  • Step 1 - Partner Exercise (to identify the firm's major issues)
  • Step 2 - Assessment Matrix (plots the relative importance/performance according to partners' perceptions)
  • Step 3 - Small Breakout Groups (have partners identify some preliminary plans for immediate action and longer term recommendations to be included into the firm's competitive strategy)
  • EXAMPLE:

    We have differentiated ourselves from other competitive firms in a meaningful way that client's recognize and value.

    Relative Importance:
    1. Low - (Needed to Play)
    3. Medium - (Needed to Compete)
    5. High - (Needed to Win)

    Current Status:
    1. Low - (Worse than Competitors)
    3. Medium - (Equal to Competitors)
    5. High - (Better than Competitors)

    MODULE 2: DISCOVERY & FORESIGHT

    2.1 Culture Inventory

    (collaboration with University of Michigan)
    The firm has initiated a process to develop growth strategies for our future. One of the important features is understanding those aspects of our culture that are most important. Our culture has played a major role in our success and is the building block for everything we hope to do in the future.

    2.2 Growth Aspirations

    In preparation for commencing our strategic initiatives, we would welcome your candid input regarding the firm's current state of growth and serious consideration of what you would like to see evolve over the next few years.

    EXAMPLES: (Identify personal aspirations and specific opportunities.)

  • Please indicate what you think the partners should work toward by way of an annual rate of growth (in profits-per-partner) over the next three years?

  •  We should grow 5 percent a year
     We should grow 6-10 percent a year..
     We should grow more than 10 percent a year.

  • By allocating 100 points, indicate which of the following general goals we should aim for:
  • Become larger (size and geography) _____
    Become more focused at being the very best
    in a few selected growth areas _____
    Become more profitable _____
    Do better legal work (in our specialties) _____
    Have more prominent clients _____
    Have a more congenial place to work _____
    Become more responsive to clients _____
    Get more stimulating (better) work _____
    Provide a broader range of services _____
    Other: _________________________________________

    2.3 Strategic Profiling Workshop

    [1 day Workshop - one-month following the Survey]
    The Sub-Committee (and partners) will receive the feedback and results of the Firm Data Review, the Culture Inventory and the Growth Aspirations Survey - the implications and recommendations that flow from these results. (half-day)

    The Sub-Committee members will engage in a series of exercises designed to explore relevant aspects of firm differentiation and examine (with what we currently know) how the future of the profession is likely to unfold over the next few years - foresight.

    EXAMPLES:

    Looking out five (5) years from today - How will the future of the profession be different? [What are the forces already at work in our profession that have the potential to profoundly transform the way in which firms will operate and services will be delivered?]

    What are the 10 things that all major firms in this profession believe in common - the implicit assumptions or conventions of the profession that are so taken for granted that nobody talks about them?

    • What business we're in
    • How we measure success
    • Who our clients are
    • What our clients really want
    • How we go to market
    • What are competencies are
    • How we extract fees and offer value

    Which of these might represent orthodoxies that might be worth challenging?

    MODULE 3: PRACTICE GROUP
    STRATEGIES

    3.1 Leverage Hidden Assets

    De-Construct Past Client Experiences: Compile a one-paragraph summary of at least three (3) of the most significant client matters each partner (by practice group) has worked on over the past eighteen months.

    3.2 Crafting A Strategic Direction for the Practice Groups
    [Schedule half day per practice group]
    The core members of each practice group will meet together in a half-day session designed to help them assess their position relative to competitors in their marketplace, identify their best areas of emerging opportunity, and develop specific action plans for capitalizing on those areas where they can improve their market positions and secure the most profitable business.

    • Identify Intangible Assets (Client contacts / Key relationships / Proprietary processes / Anything rare and valuable)
    • S-Curve Analysis (emerging-growth-mature-saturated)
    • Value Chain Analysis (profile-mktg.-systems-transaction-fees-delivery)
    • Fast-Track Action Planning (client value-skills-cost efficiency-better business)

    MODULE 4: PRACTICE GROUP CLIENT-NEED INTERVIEWS
    [Schedule half day per practice group]

    Our beliefs about the quality of lawyers' work, the way clients are treated, what clients really value, and how they make their decisions about which firm to retain in which circumstance, can sometimes be quite different from the client's perceptions. Meanwhile, there are good prospective clients in your market that many of your professionals would love to serve. We often wonder why these clients are not considering our firm and what is it that we would have to do in order to get considered. We could continue to wonder or we could take constructive steps to find out.

    We will organize an interviewing process (one-on-one and focus groups) to test some of our initial practice group strategies with real clients while also exploring their hidden and future needs - and how we might cater to those needs.

    Examples:

    • What changes are currently underway in your industry that may affect your company? What would you like to see our firm do to prepare?
    • Are there any non-legal services that you think our firm is missing out on making available to companies like your own?

    MODULE 5: EXPLORING GROWTH OPTIONS

    [1 Day]

    Your Sub-Committee will participate in a one-day session intended to analyze, synthesize, and review the strategic directions developed by each practice group.

    We will review, discuss and determine possible action plans relevant to two-dozen different pathways for future growth and profit enhancement.

    The group will participate in an interactive discussion on the three (3) critical aspects of determining competitive strategy: who to target, what services to offer, and how to deliver those services.

    We will conclude the session by:
    * identifying areas worthy of further study and/or
    * identifying initial strategies for presentation

    MODULE 6: STRATEGY FORMULATION

    6.1 Identification of Key Issues and Strategies
    Together with the Sub-Committee, we will draft our strategic directions and present the recommendations to a meeting of the partners.

    6.2 All Partner Meeting to review Firm's Strategy

    [1 day]
    We will conclude this session by identifying action plans, securing individual commitments, developing an implementation schedule with accountability, and resolving any contentious issues.

    MODULE 7: IMPLEMENTATION

    We identify those action items that would benefit from having consulting assistance in the implementation.

    Implementation is the day-to-day process of assuring that actions occur and deadlines are met. Our job is to not only measure success but to do what has to be done, including the provision of gentle but persistent nagging, to make sure the desired targets are met.

    For this reason, our engagement is considered to continue for a period of six months following the All Partners Meeting. During this period we will continue to consult on implementation and follow-up on loose ends to assure that the strategies work and yield the anticipated results.

    The implementation follow up will consist of on-site visits with the Executive Committee and key practice group leaders, substantive assistance on projects, e-mail consulting, and telephone conferencing.

    WHY CONVENTIONAL STRATEGIC PLANNING DOESN'T WORK

    • CONVENTIONAL: Interview all of the partners
      EDGE'S BREAKAWAY®: Get the partners working together to identify the firm's competitive position on 24 different issues.
    • CONVENTIONAL: Conduct a financial review
      EDGE'S BREAKAWAY®: Isn't this really the ongoing mandate of the firm's Executive Director? Problem here - it focuses on the past and on the internal, we want to focus on the future and the external.
    • CONVENTIONAL: Conduct a SWOT's analysis: strengths, weaknesses, opportunities and threats for the entire firm
      EDGE'S BREAKAWAY®: Focus on foresight folding the future back in to the present and methods for meaningful differentiation to create a (temporary) monopoly.
    • CONVENTIONAL: Develop plan at the macro level
      EDGE'S BREAKAWAY®: Recognize that the firm is made up of discrete business units requiring micro analysis. Get the practice groups working to identify new and emerging market needs.
    • CONVENTIONAL: Analyze the firm's current level of client satisfaction by surveying clients
      EDGE'S BREAKAWAY®: Accept that client satisfaction is important but that the real strategic issue is ascertaining the Needs of both clients and prospects.
    • CONVENTIONAL: Begin implementation once a plan is developed and approved - likely six to none months after starting
      EDGE'S BREAKAWAY®: Build ongoing implementation action into every step of the process. Start with small, limited-risk experiments.

    OUR COMMITMENTS TO YOU

    SATISFACTION GUARANTEE:

    Edge International's work is unconditionally guaranteed to the complete satisfaction of our clients. If you are not completely satisfied with the services provided at any stage of a BreakAway® engagement, we will, at your option, either completely waive our professional fees, or accept only a portion that reflects your level of satisfaction.

    EXCLUSIVITY:

    The principals of The Edge Group undertake and warrant that they will NOT accept an assignment on behalf of another competing firm in your city, of a similar strategic nature, within one year following the completion of our work on your behalf.

    ONGOING SUPPORT:

    As an integral part of a BreakAway® assignment, we will, for a period of six months following the final completion of our engagement, provide support (by way of telephone discussions and/or fax and e-mail communications) to answer, confer, and assist the managing partner, on the ongoing implementation of any projects and actions arising from our work with your firm.

    CONFIDENTIALITY:

    We will not disclose any information relevant to the nature of our relationship, the specific work undertaken, or any information obtained either during or after the completion of this assignment as a result of our involvement. Only after some time has passed and only if our clients themselves publicly refer to our involvement, do we acknowledge that we have served a particular firm. This policy is not the result of some cultivated secrecy or mystique. It is what we believe is professional behavior and the appropriate posture given our conviction that we supplement our clients' leadership, but never replace it.