Gain Competitive Advantage by Implementing a Broader Approach
When writing the article “Why Taking a Broader Approach Drives Optimal Performance” in late February, for the March issue of Edge International Communiqué, the current crisis was not on my mind. That article referred to “the lost opportunities resulting from not thinking more broadly” in a non-crisis environment. The crisis has exponentially increased the sense of urgency needed to readdress how to conduct business and drive necessary change.
In normal circumstances it is often difficult to effect change even though circumstances may warrant it. People are comfortable with the way they do things and there does not appear to be any downside to business as usual. Even if they are open to consider the business case for change, the time and effort to gain acceptance and manage the change is usually significant.
A crisis, however unfavorable in its impacts, creates favorable conditions for change – people feel the pain and can be more easily persuaded that the status quo is intolerable. So firm management should be bold in taking advantage of the opportunity.
What does taking a broader approach entail, and how does it benefit the firm?
Here are four areas for consideration.
A Broader Approach to Business Solutions
Diversification of service offerings is a key strategy in a fast-changing world – in the same way as diversification of an investment portfolio is designed to maximize returns while protecting against market fluctuations.
In a crisis, your clients are looking to you for solutions that are crucial to their business rather than part of the normal decision-making process. They value your insights more highly and are willing to remunerate them proportionately.
This does not apply only to larger full-service firms. Boutique firms need to expand their market penetration or find different ways of serving their clients. A menu of options might include:
- Geographical expansion
- Serving other industries or sectors
- Tailoring service to different types of client (e.g., domestic/international, large/small, public/private, corporations/individuals)
- Re-engineering service options and delivery to better serve client needs, thus building competitive advantage
The risk for firms relying on practice expertise in one or two areas for a large part of their business is that it will limit growth in terms of size and/or profitability for multiple reasons:
- Existing services become commoditized and can be more economically performed through different business models (e.g., outsourced on-line legal platforms)
- Competitive price pressures
- Some existing services may be directed at a declining industry or sector
- Practitioners with specialist skills may not see the need to diversify their offerings
A Broader Approach to Professional Development
Leveraging resources to respond to increasingly sophisticated client needs in a changing work environment requires more than legal expertise. It is time to redefine a holistic program for professional development that increases the “range” of each professional. This does require investment but the payback will be invaluable through:
- client satisfaction
- talent motivation and retention
- ability to leverage resources at a lower cost level
- increased productivity
Consider whether the following are provided in determining what might be included in such a program:
- broad exposure to different ways of working and addressing issues (e.g., professionals working for different partners/managers, in different practice or industry groups, on different types of project)
- strong mentoring and on-the-job training
- skills for working effectively in an increasingly virtual environment (i.e., use of technology and remote working)
- development of soft skills (communication, task/project management, etc.)
Increasing Collaboration and Teamwork
Collaboration and teamwork are essential to a broader approach. It is time to consider
- policies and criteria for allocating resources to projects and managing the process to ensure that the composition of teams is optimized; and
- performance evaluation criteria, including the bases for a firm’s compensation systems that drive collaboration and teamwork.
It is also time to question whether:
- the organizational culture and management style foster collaboration;
- the firm’s strategic approach envisages bringing the best team to the table for each matter; and
- the performance expectations and compensation criteria include elements that incentivize collaboration and the achievement of team goals.
Many talented professionals are productive and successful in their own right but, to the extent that they work individually or in small groups, the real potential of the organization is not realized. Lack of teamwork means that professionals dedicate time to tasks that could be done better and more cost-effectively by others, while at the same time not allowing others to benefit from their unique and relevant skills and expertise. To be clear, this is often not a result of a lack of desire on the part of individuals to collaborate, but a lack of an organizational structure that promotes collaboration.
Firms are uniting their people more than ever to discuss how best to adjust practices and move forward. Seize this moment to further entrench collaboration and teamwork as a key to success.
A Broader Approach to Client Outreach and Business Development
It is imperative to think more broadly about client relationships and to ensure that there is outreach to clients, not only to show you care but to provide value. Client expectations are changing rapidly, becoming multi-faceted and increasingly dependent not just on the proficiency of an experienced partner but on the quality and agility of the organization.
The following are examples of how to usefully expand outreach:
- obtain feedback at an institutional level about the relationships with clients, how they can be improved and, most importantly, how they can be expanded
- engage with clients on pricing arrangements to ensure they are balanced and fair – clients are under pressure and this is an opportunity to both show your concern for them while at the same time protecting the firm’s long-term profitability
- presenting timely and relevant credentials in areas that the client has not used in the past (cross-practice approach)
- using digital service-delivery mechanisms enabled by new technologies to both enhance the client experience and reduce costs (e.g., communication and collaboration platforms, case management software, eSignature applications, use of extranets)
There is often a sense of comfort that clients are content with a firm’s services and that any issues are resolved through a partner’s close relationship with the client. That is narrow and dangerous thinking, particularly at a time of disruption.
Similarly, in the development of new clients and new business, reliance on “business as usual,” in-person marketing is insufficient. In a world that is now even more reliant on internet searches, social media and online directories and recommendations, presence in these media is essential to maintaining visibility.
Do not be overtaken by events and the changing scenario – act now to adopt a broader approach. Prepare for the future that circumstances have thrust upon you.