Law Firm Intelligence: The What, the Why and the How of Win/Loss Analysis

We've all heard it: More work is staying in-house, law departments have been consolidating for years, and the work that is being sent to outside counsel requires alternative fee arrangements. As the marketplace for legal services has become more and more competitive, law firms have hired business development professionals to develop targeted responses to RFPs. Is it working, though? Has the firm brought in more business, and has it capitalized on its success?

Many firms cannot answer those questions, and for good reason: They do not have a win/loss analysis program in place. Fortunately, many firms have instituted components of a win/loss analysis program. These can be leveraged, combined and tweaked to develop a rich system for determining why the firm does or does not win new business.

Win/Loss Analysis: The What

Win/Loss analysis has been defined in myriad ways based on how it is done. Some firms track RFP wins and losses through a database, and consider a percentage of wins versus responses as a suitable analysis. Other firms monitor collections, billings, or hours, and monitor the rate of change. Yet another “win/loss analysis” involves client or potential client surveys conducted by relationship partners and possibly a marketing professional. Anecdotal data is usually held close to the relationship partner, and not widely shared with the firm or the marketing department.

Although each of these tactics is an essential component of a win/loss analysis, each alone cannot provide the recommendations for action that are required to improve a firm's competitive position in the marketplace. A more complete definition of win/loss analysis is: Win/Loss analysis is the systematic program for determining why a client choose to do business with your firm or one of your competitors (or a combination thereof).

It is systematic in that there is a process that is followed, one that takes into consideration all aspects of the RFP cycle. Both wins and losses are included, as are parties and work processes and products both inside and outside the firm. Further, the win/loss analysis is a program in that it is more than a one-off activity. A firm can do an analysis of the outcome of one RFP; however, when a win/loss analysis program is integrated into business development efforts, there is the opportunity for ongoing improvement to the RFP response process and for identification of strengths and weaknesses in a firm's business development efforts.

Win/Loss Analysis: The Why

The win/loss analysis program determines the why of the win or loss. When conducting the analysis, it is important to remember this simple point: The client or potential client is providing valuable feedback on the won or lost opportunity, and that is all. It is a reflection of one decision, and therefore the goals of win/loss analysis should be narrowly focused. This is not about client retention or satisfaction (although clients would probably view a firm's effort to garner feedback as a positive client relationship-building activity).

Some additional benefits include:

• The win/loss analysis will provide data on the efficiency and effectiveness of the RFP response process;
• It will highlight business development tactics and strategies that require refinement;
• It will give insight into your clients' and prospective clients' perception of your firm and expertise; and
• Your firm will see how your clients and prospective clients compare your firm to the competition.

Win/Loss Analysis: The How

There are six key steps to an effective win/loss analysis:

1. Establish objectives.
2. Develop key information topics.
3. Collect internal analytics, client / potential client. information and competitor backgrounds (including a SWOT, if possible).
4. Survey internal stakeholders and clients / potential clients.
5. Interview internal stakeholders and clients / potential clients.
6. Analyze and disseminate results.

Establish Objectives

The first step in conducting a win/loss analysis is to determine what, exactly, you hope to gain from the analysis. Some possible objectives include: Improving the RFP response process, determining the image of the firm's expertise in a specific industry, benchmarking the firm's progress in capturing work from Fortune 100 companies, etc.

Develop Key Information Topics

Once the objectives have been established, stakeholders should develop key information topics, often in the form of questions, that are to be researched. A SWOT analysis, as well as brainstorming and reviewing previous wins and losses with a variety of professionals ' marketing and business development professionals as well as all levels of attorneys ' will provide a depth and breadth of information that can enrich the information-gathering stage of the win/loss analysis program.

Collect Internal Analytics, Client/Potential Client Information and Competitor Backgrounds

The main goal of this portion of the program is to develop a context for the firm's business development efforts. The research should look at all aspects of the firm's efforts, and thus will involve many areas of the firm. The CI professional will need financial analytics, access to RFP documents and client/potential client information. Depending on the key information topics, the professional may also need organizational charts and client satisfaction surveys. Additional outcomes of the secondary research include:

• Refining key information topics to be surveyed and discussed at the interview;
• Comparing assumptions to actualities (billings, cross-selling success, etc.); and
• Determining the best people to include in the surveys and interviews.

Survey Internal Stakeholders and Clients/Potential Clients and Develop Topics and Questions for In-Person Interviews

With modern technology comes expanded opportunities for analysis. Surveying software is an excellent tool for gaining initial feedback from internal stakeholders, clients and potential clients. For a robust win/loss analysis, it is not enough to simply send a questionnaire to the client or potential client. Rather, the researcher should develop several survey sets geared toward the sales team (i.e. the attorneys pitching work), marketing and business development professionals, as well as the client and/or potential client.

Interview Internal Stakeholders and Clients/Potential Clients

Results of the survey should not be the end of the research process. Like the secondary research portion of the program, the survey results should facilitate the next, most important step of the win/loss analysis: the in-person interview. For the interview, it is essential to question all parties involved in business development initiatives in a manner that is professional and objective. Interviews should not be done by the attorneys. Rather, a professional trained in interviewing techniques conduct all interviews, both inside and outside the firm.

Analyze and Disseminate The Results

Finally, all of the information gathered, from the firm's analytics to the survey and interview results and analyzed according to the key information topics and objectives of the win/loss analysis. Recommendations for improvement are essential, as are highlights of current strengths. To gain the most benefit from win/loss analysis, findings should be disseminated to those who are a part of the business development team, as well as those who may, in the future, be a part of the sales team. Although most professional services firms view this information as confidential, sharing the results will empower each professional in the team to improve his or her part.

Conclusion

In today's competitive marketplace, it is not enough to know that a firm has won or lost work through an RFP response. A simple “yes/no” answer does not allow for improving the business development process. While it will involve time and resources, developing a win/loss analysis program will provide your firm with a measure of its competitive advantage' and recommendations for expanding it.

Shannon Sankstone, a member of this newsletter's Board of Editors, is the Marketing Research Analyst at Quarles & Brady, where she is responsible for the marketing and competitive intelligence research function. She can be reached at [email protected] or at 312-715-5251.

We've all heard it: More work is staying in-house, law departments have been consolidating for years, and the work that is being sent to outside counsel requires alternative fee arrangements. As the marketplace for legal services has become more and more competitive, law firms have hired business development professionals to develop targeted responses to RFPs. Is it working, though? Has the firm brought in more business, and has it capitalized on its success?

Many firms cannot answer those questions, and for good reason: They do not have a win/loss analysis program in place. Fortunately, many firms have instituted components of a win/loss analysis program. These can be leveraged, combined and tweaked to develop a rich system for determining why the firm does or does not win new business.

Win/Loss Analysis: The What

Win/Loss analysis has been defined in myriad ways based on how it is done. Some firms track RFP wins and losses through a database, and consider a percentage of wins versus responses as a suitable analysis. Other firms monitor collections, billings, or hours, and monitor the rate of change. Yet another “win/loss analysis” involves client or potential client surveys conducted by relationship partners and possibly a marketing professional. Anecdotal data is usually held close to the relationship partner, and not widely shared with the firm or the marketing department.

Although each of these tactics is an essential component of a win/loss analysis, each alone cannot provide the recommendations for action that are required to improve a firm's competitive position in the marketplace. A more complete definition of win/loss analysis is: Win/Loss analysis is the systematic program for determining why a client choose to do business with your firm or one of your competitors (or a combination thereof).

It is systematic in that there is a process that is followed, one that takes into consideration all aspects of the RFP cycle. Both wins and losses are included, as are parties and work processes and products both inside and outside the firm. Further, the win/loss analysis is a program in that it is more than a one-off activity. A firm can do an analysis of the outcome of one RFP; however, when a win/loss analysis program is integrated into business development efforts, there is the opportunity for ongoing improvement to the RFP response process and for identification of strengths and weaknesses in a firm's business development efforts.

Win/Loss Analysis: The Why

The win/loss analysis program determines the why of the win or loss. When conducting the analysis, it is important to remember this simple point: The client or potential client is providing valuable feedback on the won or lost opportunity, and that is all. It is a reflection of one decision, and therefore the goals of win/loss analysis should be narrowly focused. This is not about client retention or satisfaction (although clients would probably view a firm's effort to garner feedback as a positive client relationship-building activity).

Some additional benefits include:

• The win/loss analysis will provide data on the efficiency and effectiveness of the RFP response process;
• It will highlight business development tactics and strategies that require refinement;
• It will give insight into your clients' and prospective clients' perception of your firm and expertise; and
• Your firm will see how your clients and prospective clients compare your firm to the competition.

Win/Loss Analysis: The How

There are six key steps to an effective win/loss analysis:

1. Establish objectives.
2. Develop key information topics.
3. Collect internal analytics, client / potential client. information and competitor backgrounds (including a SWOT, if possible).
4. Survey internal stakeholders and clients / potential clients.
5. Interview internal stakeholders and clients / potential clients.
6. Analyze and disseminate results.

Establish Objectives

The first step in conducting a win/loss analysis is to determine what, exactly, you hope to gain from the analysis. Some possible objectives include: Improving the RFP response process, determining the image of the firm's expertise in a specific industry, benchmarking the firm's progress in capturing work from Fortune 100 companies, etc.

Develop Key Information Topics

Once the objectives have been established, stakeholders should develop key information topics, often in the form of questions, that are to be researched. A SWOT analysis, as well as brainstorming and reviewing previous wins and losses with a variety of professionals ' marketing and business development professionals as well as all levels of attorneys ' will provide a depth and breadth of information that can enrich the information-gathering stage of the win/loss analysis program.

Collect Internal Analytics, Client/Potential Client Information and Competitor Backgrounds

The main goal of this portion of the program is to develop a context for the firm's business development efforts. The research should look at all aspects of the firm's efforts, and thus will involve many areas of the firm. The CI professional will need financial analytics, access to RFP documents and client/potential client information. Depending on the key information topics, the professional may also need organizational charts and client satisfaction surveys. Additional outcomes of the secondary research include:

• Refining key information topics to be surveyed and discussed at the interview;
• Comparing assumptions to actualities (billings, cross-selling success, etc.); and
• Determining the best people to include in the surveys and interviews.

Survey Internal Stakeholders and Clients/Potential Clients and Develop Topics and Questions for In-Person Interviews

With modern technology comes expanded opportunities for analysis. Surveying software is an excellent tool for gaining initial feedback from internal stakeholders, clients and potential clients. For a robust win/loss analysis, it is not enough to simply send a questionnaire to the client or potential client. Rather, the researcher should develop several survey sets geared toward the sales team (i.e. the attorneys pitching work), marketing and business development professionals, as well as the client and/or potential client.

Interview Internal Stakeholders and Clients/Potential Clients

Results of the survey should not be the end of the research process. Like the secondary research portion of the program, the survey results should facilitate the next, most important step of the win/loss analysis: the in-person interview. For the interview, it is essential to question all parties involved in business development initiatives in a manner that is professional and objective. Interviews should not be done by the attorneys. Rather, a professional trained in interviewing techniques conduct all interviews, both inside and outside the firm.

Analyze and Disseminate The Results

Finally, all of the information gathered, from the firm's analytics to the survey and interview results and analyzed according to the key information topics and objectives of the win/loss analysis. Recommendations for improvement are essential, as are highlights of current strengths. To gain the most benefit from win/loss analysis, findings should be disseminated to those who are a part of the business development team, as well as those who may, in the future, be a part of the sales team. Although most professional services firms view this information as confidential, sharing the results will empower each professional in the team to improve his or her part.

Conclusion

In today's competitive marketplace, it is not enough to know that a firm has won or lost work through an RFP response. A simple “yes/no” answer does not allow for improving the business development process. While it will involve time and resources, developing a win/loss analysis program will provide your firm with a measure of its competitive advantage' and recommendations for expanding it.

Shannon Sankstone, a member of this newsletter's Board of Editors, is the Marketing Research Analyst at Quarles & Brady, where she is responsible for the marketing and competitive intelligence research function. She can be reached at [email protected] or at 312-715-5251.