There is more to this story than meets the eye.
Latham’s largest clients use an average of 21 of the firm’s offices. This doesn’t happen by accident. Kirkland didn’t close almost 10 deals a week last year through luck. The success of these firms is based on foundational skills, strong core building blocks—and well thought out strategies.
Their blocking and tackling skills serve as the underpinning of success. Here are the key (but unsung) parts of their outsized growth and profits:
Highly Selective in Targeting Clients
A select group of coveted clients have needs requiring law firms to deliver across multiple offices, drawing on numerous practices. Latham targets and goes after these clients with a vengeance. Their BD goals and efforts focus on getting and growing these clients. Kirkland puts their emphasis on private equity firms, starting with the largest.
Both firms also target the biggest spenders in largest spending industries where clients have ongoing needs. Latham and Kirkland draw on this strategy and use it to their advantage by targeting very specific clients who will drive their success.
Go-to-Market by Industry-Facing Groups
Becoming known in an industry requires more than a change in marketing—it requires investment. Kirkland began their biggest investment in the private equity market beginning in 1984 when the industry was in its infancy. Over the years, their Private Equity Ski Conference has placed them at the epicenter of the US private equity market.
Latham has made large scale investments in their industry facing programs. They use this to communicate their business understanding—the single biggest differentiator in the market.
Strategic Discipline
Kirkland and Latham stick to their plans. They monitor and adjust, but they give their efforts enough time to succeed. If interim results aren’t on target, they change the plan—not the goal.
They Know How to Make Lateral Partners Work
Both firms routinely pick off lateral partners and are among the small number of firms where laterals are successful. Both firms know how to bring laterals into their cultures. These firms know how to leverage each lateral’s book. And they do more due diligence in their laterals than most other firms combined.
Fewer but Bigger Investments
Each firm targets fewer clients, markets, and practices than other firms. They invest more capital and their best people. More money invested in fewer places yields a higher strategic ROI.
Client Teams
Latham’s client team program is more than a decade old. They are honed, have budgets, and are supported by money, people, tools, training, metrics, and infrastructure to make them work.
Culture of Strategy
The strategies at Latham and Kirkland are clear and concise. These firms articulate their strategies with energy and passion—engendering enthusiasm at the firm. They have few naysayers. The attorneys who don’t agree with the firm’s strategic direction, don’t usually stick around.
Focus on Existing Clients, but….
Near-term future success lies in developing existing clients. These market-leading firms are intensely focused on developing existing clients. It’s not only part of their strategy—it’s part of their culture and BD system. But these firms target new clients as well—often by name—to add to their stable. As we discuss above, each firm targets the clients who best fit their strategy and approach—and are the biggest legal spenders out there.
Invest in Business Development and Support
It takes a village, or at least a robust business development staff, to support these highly driven partners. We estimate each firm has 1 BD person for every 4 equity partners. This compares to 1 BD person for every 4.6 partners at the largest 3 law firms—and 1 BD person for every 6.2 equity partners for the typical Am Law 200 firm.
Share the Credit
Business development is usually a team effort—and an effort many firms don’t acknowledge. Latham shares credit for origination, support, or even a referral. You don’t have to close the sale to get credit. All the key players are recognized for their collective effort. This incentivizes all attorneys to do their part to win new work for the firm.
Talk to Clients—Directly and Indirectly
Kirkland and Latham base their growth strategies and tactics on many factors, including client feedback. Their approach is informed by client thinking. They know law firms can’t be successful without learning from and responding to client thinking.
Any and every law firm can adopt the tactics and strategies embraced by Latham and Kirkland. All firms can target the best clients (not the most prestigious—but the clients most likely to drive success). Every law firm can set up client teams, get client feedback, and with some work—change their business development credit system.
Some firms have embraced these tactics with a limited number of clients or opt-in programs. But, firms embracing this approach to the market across their major client base can expect to see results in as little as 14 months from any single change.
Kirkland and Latham have been at it for years—and offer proof of concept. Now, who will be next?
MBR