Ideas for the Future - The Corporate and Insurance Client Relationship

Transcription

1 CLM 2017 Annual Conference March 29-31, 2017 Nashville, TN Ideas for the Future - The Corporate and Insurance Client Relationship I. The Corporate/Insurer Business Relationship with Law Firms Setting the stage for the relationship How can law firms balance attorney client relationships with ethical obligations to foster successful partnerships? The simple keys to successful business relationships are often coined as being communication, information and commitment, yet many Corporate / Insurance clients and their law firms struggle to build alliances that inspire long term sustainability. Creativity, business acumen and engagement on the part of all stakeholders is essential given our challenging economic climate, the expansion of in house counsel organizations and the needs of Corporate / Insurance clients / firms to achieve even more effective legal handling. And nurturing the core goals of the business relationship has never been more critical as data and analytics expands the use of quantitative / qualitative performance indicators to measure whether these partnerships are mutually productive and profitable. Core Goals The Building Blocks of the Relationship The relationship between Corporate / Insurance clients and law firms has historically been defined from within their respective organizations. As consumers of legal services, Corporate / Insurance clients look to law firms to deliver value driven, high quality solution oriented legal work at all levels while law firms strive for excellent outcomes, high client retention and continuous growth. As business enterprises, Corporate / Insurance clients and law firms share similar goals: dependable Page 1 of 5

2 partnerships, customer satisfaction, tangible results, expert risk management and strong financial discipline. Corporate / Insurance clients and law firms continue to progress in the areas of advancing quality, enhancing efficiencies and improving support services but how can they further advance toward an optimal state of realizing lasting mutual benefits and rewards? One method may lie in their willingness to jointly embrace the growing importance of operational predictability and transparent communication as core elements of their business relationships. II. Seeking Predictability in an Unpredictable World The scope of operational predictability includes the critical element of prospective alignment in the pursuit of orderly, recurring and meaningful legal results. As such, operational predictability is paramount for both Corporate / Insurance clients and law firms as they labor to function in the highly technical and often complex world of well-defined performance expectations and strict accountability to management and shareholders. And while Corporate / Insurance clients and law firms agree that a mutual understanding of expectations is fundamental to a successful business relationship, disruption in the form of uncertainty and misalignment can block their efforts to maximize collaboration. Importantly, the parties need to carefully examine their mutual needs and ask probing questions regarding their collective capabilities to achieve a shared framework where operational predictability becomes the touchstone of their interaction. A. Corporate / Insurance Client Perspective What do Corporate / Insurance clients really want from their law firms? Is predictable legal quality, results and cost management enough as the demand for highly effective legal services evolves? Today, law firms are asked to manage an array of guidelines, protocols and do-and-don ts that shepherd attorneys through various budgeting and reporting requirements. Pressure to retain clients is ever building as inhouse law departments continue to expand and administer more of their own core legal services. Given their defined infrastructures and broad resources, many Corporate / Insurance clients work to enhance predictability for their law firms through the use of performance data and analytics, yet the majority of small to mid-size law firms which is 80% of the practicing legal population per the 2016 Legal Trends Report, do not Page 2 of 5

3 regularly maintain or rely upon data to the same extent in managing their businesses. The firms that do however, have discovered that business intelligence derived from data can better inform their strategies and elevate discussions with clients above the norm. And whether or not firms have the resources to implement technology capable of generating useful case management data, some Corporate / Insurance clients are developing predictive analytics to expand the discussion regarding legal performance. This can lead to even more opportunities to collaborate and re-align goals and client expectations in advance of significant performance deviations. B. Law Firm Perspective How can law firms increase their focus on operational predictability with Corporate / Insurance clients? Generally, the vast majority of law firms no longer subscribe to the notion that simply practicing law is the best way to meet the needs of their Corporate / Insurance clients. Instead law firms recognize that engagement planning, especially in complex litigation, along with managing their own projects internally are positive steps toward achieving predictability. In addition, law firms can foster operational predictability by establishing dedicated attorney teams and right fit staffing models with leads to act as subject matter experts regarding client expectations. Such attorney teams are typically well versed in the Corporate / Insurance client s litigation philosophy and can effectively manage the terms of a customized legal service delivery model. Another concept law firms might consider in achieving operational predictability is to advance continuous process improvement methodologies regarding their operational governance over people, systems and costs. Finally, a vital key to creating operational predictability for all parties is to effectively engage the uniform use of technology across organizations to optimize the delivery of legal services and outpace evolving business needs. III. Exploring Transparent Communication and Knowledge Sharing A. Sharing a Clear Vision and Strategy The renowned playwright and critic, George Bernard Shaw stated that, The biggest problem with communication is the illusion that is has occurred. Law firms and their Corporate / Insurance clients can build mutually beneficial relationships by sharing a common vision and strategy at both the client portfolio and case levels through joint Page 3 of 5

4 strategic planning. An ongoing challenge for both law firms and clients is attaining alignment regarding the communication and execution of litigation guidelines and protocols. Thus, all parties need to continuously ask whether they are providing clarity of purpose, identifying mutual measures of success and collaborating on ideas for future improvement. Law firms that share a common purpose with their Corporate / Insurance clients are positioned to deliver predictable results and convey their client s litigation philosophies to opponents and judges. Whether the Corporate / Insurance client s needs are short or long term, vision and planning the relationship should be conceived through open conversation founded upon a platform of clearly aligned priorities that can allow employees to fully engage and execute their obligations. B. Reaching beyond prevailing business perspectives Today, a common notion is that while law firms demonstrate accomplished legal skills their businesses may not be fully capitalizing on the processes, benchmarking and strategic planning techniques that their Corporate / Insurance clients spend hours analyzing and developing. Yet, many law firms do recognize the intrinsic value in in learning their client s experiences and methodologies as part of actively managing their businesses. The heightened use of industry intelligence and the application of internal metrics to assess the performance and financial health of the firm, practice groups and major projects are examples. Avenues being explored by clients and law firms to reach beyond merely servicing the needs of clients include pooling information through collaboration vehicles such as focus groups and forums to assist in the development of long term projections around resources, talent retention and enhanced performance. Many firms are empowering firm leadership to transform more quickly to better position themselves to react to client demands for rigorous litigation oversight and effective cost delivery. Looking outward, law firms and Corporate / Insurance clients must endeavor to evolve together and commit to create well defined business objectives and collaborative leadership structures that drive solution oriented plans and high operational predictability. To do so, transparent communication and the mutual sharing of knowledge are key to permitting meaningful two-way discussions and establishing values and common goals that enable and engage employees at all levels. The panel for this session will also provide additional context and examples of where Page 4 of 5

5 the parties can take their relationships in the future and will further address the challenges faced in balancing the ethical obligations of the attorney client relationship with any rules of engagement to meet the Corporate / Insurance client s litigation needs. Page 5 of 5