Strategic planning graduated from mandatory monotony to mission-critical.

Law firms have more money at risk than ever — and the future is made up of bets and choices. These bets include markets, talents, changing demands of law firms by attorneys and clients — and the free-for-all developing as law firms poach each other’s partners.

Strategic plans were once a discussion among a few partners. Now, meticulous processes with a combination of facts, trends, experience, ideas, vision, and intuition drive the most successful plans. Some firms are there — others are getting there. And a few don’t care.

Patrick McKenna and I surveyed more than 200 law firm leaders to delineate the state of the art — and how to make it better. It’s a cornucopia of approaches, processes, and results.

Use it to pick from the best. Use it to position yourself to help. And use it to help drive outsized results.

You can find the link to download the full complimentary report at the end of the post. Here are the highlights:

15% of law firm leaders characterize their strategic planning as excellent — with another 11% describing it as good. This leaves 74% of law firms with sub-optimal strategic planning — and likely plans.

69% of law firm leaders indicate strategic planning is more important than ever or nearly so. They see the risks — and the rewards.

6.5% of leaders eschew plans and are opportunistic. They consider themselves agile and have keen instincts. This too is a strategic plan — to be opportunistic.

79% of law firm leaders indicate they have written strategic plans. But most don’t see them as excellent — leaving work to do and decisions to be made.

Only 34% of firms interviewed or surveyed a majority of their partners as part of the process. This dilutes engagement at all levels as they feel excluded. It also reduces interest in understanding the plan — never mind implementing it.

45% include client surveys and feedback in their strategic plan. More than half exclude a vital guidepost in spotting opportunities from the constituency with enormous influence on your results. Clients offer a broad view of needs and see strengths in law firms they rarely see in themselves.

68.2% of leaders use a consultant to help facilitate the planning process. Of these — only one-third reported successfully implementing all of their plans. A good consultant will help — a mediocre consultant or less will hurt.

Leaders with internally focused plans are 20% less satisfied with their plans. These leaders intuitively sense how an external focus brings new insights. They also add energy and enthusiasm as it delineates more opportunities for attorneys.

35% of firms formed a dedicated committee to develop the strategic plan. These committees hold each accountable for bringing in the right facts at the right time. They add structure and accountability to the process.

Larger firms have more targeted goals and plans. 44.2% of firms described their plans as brief and targeted — this drops to 12.5% for firms with less than 500 attorneys. Brief and targeted beats broad and all-inclusive.

18.6% of leaders indicate they implement almost all of their plans. So many firms see their plans lying on a shelf or server somewhere. Implementation demands more resources than planning — with specific accountability for implementations — most often a key missing link.

Law firms can improve their strategic planning process — and develop more compelling plans — by embracing the following processes:

Avoid negotiated strategic plans

Law firms report the strategic plan is effectively a result of the ability of certain practice leaders to negotiate for their interest or goal — adding facts from clients and partners will help ground truth the plan — and eliminate negotiated strategies.

Add client input — 3 advantages

Clients have a broad view of their needs and how they will change — in addition, 70% of law firms don’t match client perception — alignment is one key to success. And — they help eliminate negotiated strategic plans.

Add attorney input

It’s worth it for the one insightful new idea — and it will come from a place you least likely expect. You will also boost overall attorney engagement.

Lay out the process for all

Let everyone in the firm know what is happening and when. This knowledge boosts engagement and creates energy around strategic thinking. It also establishes a form of accountability to the firm for completion and implementation.

Short beats long

Take the time to make it brief and targeted. It takes more work and may demand more decision making — but it drives success.

Embrace alternative and nontraditional views

New market opportunities are arising that only associates know about. New regulations are creating counterintuitive opportunities. Talent retention demands new strategies not typically used in law firms. The pivotal insights and facts may lie outside the current field of vision. Multiple and alternative viewpoints — harnessed with positive energy — are one of the most powerful tools to make all this change work for you.

Attorneys love an intellectual challenge. It lies before you in the form of strategic planning. The firms upping their strategic planning process are the most likely to emerge as the next market leaders — and they will enjoy better retention as few things attract high-performing attorneys more than success — ditto for clients.

You can download a complimentary copy of the full report Dissecting the Processes of Law Firm Strategic Planning here.

Law firm leaders are getting their arms around 13 issues impacting their strategies — 4 dominate.

Based on the survey my longtime friend and collaborator, internationally recognized law firm consultant Patrick McKenna, and I conducted with more than 200 law firm leaders — we uncovered the top strategic issues standing in the way of law firms getting the edge they want.

The top strategic issues look like this:

Growth at 46.95% of leaders

No law firm wants to let a competitor grow in its client base. Growth is now both offense and defense. But it’s all about growing the right way — offering career opportunities for rising stars, engagement for all, an advantage in attracting laterals, better margins, and protecting market share and clients.

Lateral poaching remains the preferred method to drive growth. But law firm leaders are looking for the industries where it would be wise to double down. Despite the talk of law firm mergers picking up — most firms don’t want to see a merger as their first choice.

Generative AI at 32.65% of leaders

So many lovers and haters. These law firm leaders see Generative AI as a serious disruptor — while others see AI as something to be avoided.

A few firms will make big bets on client-facing tools. Others are betting on workflow. Only 5% of law firm leaders think Generative AI will be a big nothingburger. This contrasts with the 32.65% who think it is the defining issue. The bets are on.

Improving Culture at 26.53% of leaders

Strong and strategic culture drives success. It drives engagement, productivity, branding, client service, business development, and retention. Improving culture solves so many problems law firm leaders face. Strong cultures are also more open to change — something law firms will see more of instead of less.

Talent Retention at 26.53% of leaders

A great lateral means a lot if you are on the receiving end. A loss hurts. Just over 1 in 4 law firm leaders see retention as the top strategic issue. Retention is a first cousin to improving culture. Those leaders able to improve culture are simultaneously improving retention.

(Note: total percentages are greater than 100% as a result of multiple responses.)

Law firm leaders also point to a set of smaller but significant issues. They deserve time and attention — but most can be dealt with by solving the dominant 4. These smaller strategic issues include:

Strategy

Rate Increases

Transformation

Productivity

Every year, we ask more than 300 corporate counsel about the law firms they recommend to a peer — no name, prompts, or suggestions provided. It’s all organic. The results:

• Only 35% recommend their primary law firms to a peer — down from 69.1% a mere 4 years ago. This rivals an 18-year low.

Delivering Yesterday’s Client Service

One big contributor to the drop in client service is corporate counsel’s new expectations. Law firms targeting yesterday’s expectations are at a clear disadvantage. These new expectations include:

• Including clients early in strategy and approach
• Being trusted enough to be relied on for cost control
• Higher client service standards for their primary law firms
• Being easy to work with
• Fielding the absolute best team

All these new components make clients’ lives easier and get them to their goals. We discuss these expectations and the law firms best at each here, here, and here. But, that’s not all.

7 Reasons Why Clients Don’t Recommend Their Primary Law Firm

Our research shows corporate counsel point to 7 reasons for not recommending their primary law firm:

1. Little interest in understanding corporate counsel’s goals. Almost all the new goals are focused on advising management on transforming their business — and using it as a career booster.
2. Hard to work with. The legal prowess may be there, but the administrative obstacles are enough to ruin the most elegant of strategies. Clients point to:

• Time and effort to start a new matter
• Renegotiating rates for every matter
• Negotiating conflict waivers
• Delays between conflict clearance mobilization

3. Getting the B Team. Clients don’t know who is performing the work, some see a flurry of names on the bills. These experiences make clients think there is little thought into who is doing the work.
4. Reluctance to provide an early assessment in litigation.
5. Learning new deal strategies and structures their primary firm used from a 3^rd
6. Ghosted when their relationship partners leave the firm.
7. Don’t share ideas and strategies about current issues and problems.

Corporate counsel are busy managing their own journey while relying more on outside counsel than at any other point in the last 23 years. BTI research reveals that 67% of corporate counsel are busy helping pave their company’s path for transformational change. They want advice and advanced thinking — and excellent client service depends on law firms meeting today’s and tomorrow’s expectations.

These firms are making a bet.

They are betting investments in client service in a perceived fragile market will deliver immediate and lasting value — both strategic and financial.

Only 64 law firms managed to improve client service performance in 2024 — according to corporate counsel. This equates to just shy of 10% of all law firms. And client service still remains the biggest differentiator among law firms.

One key driver — corporate counsel have new roles and responsibilities. They don’t announce their new goals — they simply change their behavior. Only the firms with keen institutional eyes and ears pick up on these new objectives. These 64 firms are amping up on both counts.

Please join me in congratulating the most improved law firms in client service performance for 2024:

Novel and complex legal needs are rapidly eclipsing the straightforward and difficult needs. The law firms snagging this work learned quickly how to pivot and change strategies. Their client feedback gave them early insight into new needs and these firms developed new business tactics.

They target corporate counsel’s most vexing and high-value needs — not to be confused with yesterday’s needs — and higher rates. They offer creative and new solutions. These solutions are the centerpiece of their approach — and new business.

36 needs and pain points stand out in the overflowing sea of needs. The spectrum ranges from the never seen before to new takes on existing issues. Focus your business development on these issues, and you will hit the high-rate bull’s eye.

These pain points and needs break down into 5 categories:

Complex, new, and novel matters are driving the market — as are transformational and strategic M&A. These create new demands for clients — who are enjoying the challenge — and their outside counsel. These new demands include the ability to:

• Serve as the source of new ideas
• Develop brand new strategies and thinking
• Bring tech savvy in delivering services
• Use and understand key aspects of Generative AI
• Offer creative interpretations of existing rules and regulations

Clients tell us 121 law firms deliver on one or more of these 5 strategic activities, at scale. You can learn the detailed tactics and strategies to deliver at scale in the newly released report BTI Leading Edge Law Firms 2024: Law Firms Creating the Future with and for Clients.

Please join me in congratulating each of these law firms on their prowess in helping clients with their business transformations:

You want to make an imprint. A positive imprint. You want to be remembered. Being remembered means getting hired.

Corporate counsel hear a lot of pitches and talk to a lot of attorneys — an average of 22 a month at last count. They report hearing a lot of noise and routine data about current matters — or in a pitch, they hear about endless numbers of matters and statistics.

Of these conversations and meetings — top corporate counsel define 9 circumstances triggering a coveted place in corporate counsel memory banks. We discuss each below:

A new and good idea

New ideas bring better outcomes — or at least the potential for better outcomes. Corporate counsel say the only reason they sit through endless pitches is to get new and good ideas.

You can get detailed recommendations on how to develop new ideas with and for clients — and the firms who do it best — in our new report BTI Leading Edge Law Firms 2024: Law Firms Creating the Future with and for Clients.

An industry insight

Learning what others are doing helps clients learn to be better. It may open new doors. Or it may confirm current strategies. Both bring equal value. Almost every CEO asks their top legal officers if their problem is typical of the industry — and what they are doing about it. Outside counsel sharing this knowledge makes a lasting imprint.

Learning something new

Corporate counsel enjoy intellectual growth — and how to improve what they do. Outside counsel double their chances of being remembered by teaching clients something new and helpful.

Unexpected engagement

The good news for law firms — most clients have low expectations for pitches and meetings to discuss new business. Engagement is low and few attorneys go off script. But — engage more — and you are among the remembered few. Start with a meaningful question or observation — ask for an opinion — start a dialogue — and you successfully convert your discussion to engagement.

Opinions about approach

Clients want to know what they are getting into with outside counsel. This means understanding how far they will go with early assessments. The more you assess — the better the chances you will be remembered. Clients know you don’t have all the facts — but they believe the outside counsel who draws on the limited facts and combines them with their experience will work harder for them and bring a better result.

Sharing a unique fact about the company

Every company has an idiosyncratic fact or piece of history. Few professionals are aware of these facts — and the ones who do get remembered. Dig into history, news, and brands and you will find something. This is a great use of the AI Chatbots – at least to start. Some prompts to begin with: Tell me something unique about (i.e., Microsoft) that no one is likely to know (their original name was Micro-Soft).

And the following will get you remembered for the wrong reasons:

Backtracking

Apparently, some law firms claim credit for an experience where they are adjacent — as in didn’t play a main role. When called on it the law firms will back down — but will also be remembered for the wrong reasons.

BS — not Bachelor of Science

Easily spotted — trying to talk your way through a problem with little knowledge of the issue or solution. Better to ask questions — clients are happy to teach you — and know they might learn something just by explaining it.

Oculocardiac reflex

Rub your eyes and cradle your face after a meeting? This is a reflex — the oculocardiac reflex. It is calming to you — but insulting to people who were in the meeting with you.