Change As a Management and Marketing Tool

These things didn't happen by accident, nor by just an inspiration by a few bright lawyers. They are the result of an evolutionary process ' which is change.

What, Exactly, Is Change?

In the context of professional services practice and marketing, change is alteration of a process or condition that varies from the past. Too many professionals see change as an event ' finite ' an end in itself. In fact, change is not an event that's arbitrarily made to happen, but a process, the result of which is changing something. Most often, and with exceptions and only in rare cases, that process leads to an evolution, and sometimes, even revolution (such as professional firm advertising, long forbidden ' now common).

Second, change in the professions and in marketing professional services isn't often deliberately made. It evolves slowly in response to external stimuli. Except for a few visionaries who anticipated the future in areas such as billing structures and firm governance, it most often comes in response to changing needs of the marketplace, which demand new practices and new structures to serve those needs. Electronic media, for example, wasn't invented to change the practice of law or accounting ' but it served to generate and facilitate change in those professions. And not overnight, either. It certainly was a response to the need to compete in an increasingly competitive market. Social media began as just that ' social. But it evolved into a competitive tool by virtue of its ease of communication to large numbers of people. It was useful because it circumvented the rigors of external control of message, such as happens in the print media, and has a broader and more immediate reach than does the traditional media. Opportunity, then, precipitated change.

Value Billing

A case in point is value billing, which has been touted for decades, and is only now emerging as a common practice. Firm governance, and the traditional top-down firm management that's long been the tradition in professional firms, is slowly, slowly emerging in new forms that better serve a practice's ability to help clients. Client service teams are emerging to replace the eat-what-you-kill culture, in which each individual in a firm is his or her own entrepreneur. On the horizon today is the corporately owned or public professional firm.

I point this out, not to carp, but to wonder, and to consider, how this process can be dealt with competitively, and whether there is an initiative that can be taken to stay ahead of the curve. And to note, as well, how frank marketing is affected by change.

There are two main areas in which change is imminent in the professions ' firm structures that allow a firm to better serve the evolving needs of its clients, and marketing that's consistent with the clients' changing economic environment. Both are necessary for competitive reasons, both are imminent in order to keep a firm relevant to the dynamic changes in the world of both commerce and society. (There are, at the same time, many changes that occur daily as a result of new laws and regulations, but changes these are promulgated in response to external factors that precipitated the new laws, such as Sarbanes-Oxley. A Sarbanes-Oxley, by virtue of the need for skills needed to help clients function under the law, is itself a major marketing tool.)

We live in a dynamic world, in which constant motion of events and social and economic structures continually alter the state of many activities and circumstances. For example, the advent of the personal computer in 1981 changed the way trade and commerce was done. This altered the nature of financial structures, industrial practices and communications. But it also gave rise to new laws and new needs in legal services and finance. It created a new business environment that affected all participants in the cycles. New financial instruments, new laws and regulations, new technology that accelerates the pace of doing business, growing internationalism, the expanding body of knowledge in so many areas and the rapidity with which it can be organized and retrieved, new demands from client ' all substantially change the demands upon lawyers and accountants, and therefore, the structures and practices that professionals must adapt to stay abreast of their own clients. All present new grist for the marketing mill.

I contend that any professional in that cycle who doesn't react to its dynamics will fall behind those who do.

Inhibitions to Change

There are many reasons for the resistance to change, not the least of which is the amorphous nature of professional services management and marketing education. The quality of academic and law firm marketing education in this field is dismal and retrogressive. The relationship between the marketers and the professional is often built on mutual misunderstanding. And perhaps because law firm marketing is so subsumed by a firm's professionals with too little understanding of the process that too many marketers are either unwilling to risk innovation or else are incapable of it.

Still, there are techniques to keep professionals relevant to the changing needs of the clients, and to keep marketing functional and successful beyond the mundane. For example, consider that while the ultimate aim of marketing professional services may be to get clients, growing a successful firm is a function of keeping a firm relevant to the changing nature of its economic environment, and particularly the needs of the clientele. Obviously, then the marketer must understand that environment, which then becomes the canvas upon which the marketing program is painted.

This is certainly true in professional services marketing, where recycling old ideas instead of bothering to come up with new ones, is a too common practice, and where the failure of professionals to fully grasp the reality of the crucial role that marketing plays in a practice tends to suppress innovation in so many firms.

Possible Changes in the Not-Too-Distant Future

Predicting the future course of events can be a fool's game, especially as an extrapolation of current trends and practices. Anticipating future events, by the way, doesn't work well by looking at current practices alone, and except as they are tempered by external trends. Lawyers and accountants, for example, didn't invent the Internet and the social media, both of which are now an increasingly important part of professional practice. There are several areas that seem to be inconsistent with the current changing environment. Some examples follow below.

The fragile partnership structure, which can slow down decision- making that should be responsive to changing economic decisions. What will replace it?

Law and accounting firm billing procedures, which may have a value in informing clients of the time spent in the client's behalf, but rarely reflects the value in the service performed. Value billing is emerging, but is still evolving. Who knows for sure which method will emerge as the standard?

Partner and non-partner compensation changed radically during the current economic turndown. What will it become as the economy recovers?

During the course of this recession, thousands of lawyers and accountants were discharged. What will be their availability as the recession recovers? What will be the shape of the accounting and law firms in the recovery?

Growth requires capital, which may be more than a firm's partners can contribute. Is the publicly-held law or accounting firm in the foreseeable future?

The shortage of brains and talent in the world today is too acute to continue the caste system in professional firms. Talented professionals may not be “partner material” (whatever that is). But the need for their skills suggest that in the future, firms may be structured on talent, rather than on traditional methods and requirements like rainmaking abilities and longevity (the two-tier system).

Today, law and accounting schools send their graduates into the world with little or no education about the economics of practice, nor an understanding of the crucial role modern marketing plays in firm management and growth. We see signs of change here ' but only in isolated incidents. That should change ' but how?

Despite three decades of experience in professional services marketing, remarkably little innovation seems to have occurred in its practice in recent years. Part of this is because of the random education in professional services marketing; part because marketing itself is an art form in the way it's executed ' and there are not that many artists. Yet another reason is the lack of formal education in professional services marketing, which is very different from product marketing. A significant factor is that accountants and lawyers have little foundation in how to hire and evaluate marketers, which often results in unsatisfactory marketing process, and failure to judge good from bad ' effective from ineffective.

Because of the disconnect between professionals and marketers, many marketers don't innovate, even in an arena in which all marketers have the same tools. The winners know how to use those tools innovatively; the losers do not. The marketers either feel intimidated by the stature of professionals, or don't know how to do anything except by rote. Perhaps time and competition will temper this situation.

Functioning in a Changing World

Several things beyond outright behavior modification can make it possible for both professionals and marketers to participate in the change process.

Learn to fathom those elements, both economic and social, that are currently changing. For example, new technology, including the new social media. Even if you don't plan to participate, learn it. You'll understand a great deal of the dynamics of new aspects of society and the economy. You'll spot trends.

Don't insulate yourself from the marketing process if you're a professional, or from the nature of law if you're a marketer.

If you're a marketer, try to understand the lawyers. This means the people, the lawyers, as well as the process. Their attitudes, their points of view on the clients, the way they think, their values. Don't try to turn them into marketers ' marketing is your job ' but rather teach them how to be participants in the marketing process. As a marketer, you're not going to change the professionals, but you can educate them within the context of their professions.

If you're a lawyer, you don't have to be a professional marketer, but you should know enough about the process to be able to participate in it as appropriate, as well as to understand the marketers and how their professional minds work. Ultimately, in a successful marketing program, you're going to have to participate in the process and in bringing the prospect into the fold. Learn how it's done. It's a process well within your training and experience.

Read the trade media, both the law and accounting trades and the publications serving the industries the clients are in. Not just for the news, but for the trends.

When you spot a trend, particularly one that veers from traditional professional practice (such value billing, or using client service teams effectively), don't make snap judgments. Even if you're not ready to bring them into your practice, they may eventually be right for you.

If you can't innovate, at least learn to respond to external factors that can affect your practice, your firm, and your clients.

Competitive intelligence is important. You should be aware of other firms and what they're doing that you're not, but should be. Or that may eventually be right for you.

Learn to question everything you do. Ask yourself the question, “This is the way I did it yesterday. Is it the best way to do it today?” You'll be amazed at the answer.

Is change a marketing tool? Absolutely, if understanding and dealing with it puts you a step ahead of your competitors. And remember, evolution is constant, and change is coming ' whether you participate in it or not.

Bruce W. Marcus, a member of his newsletter's Board of Editors, is a Connecticut-based consultant in marketing and strategic planning for professional firms, the editor of The Marcus Letter on Professional Services Marketing, (www.marcusletter.com) and the co-author of Client At The Core (John Wiley & Sons, 2004). E-mail: [email protected]. ' 2010 Bruce W. Marcus. All rights reserved.

In this economic environment, the word “change” looms large in professional services dialogue. The nature of the professions, rooted as they are in history and tradition, can be fairly rigid, and resistant to innovation. But the times seem to have accelerated the need for new ideas and structures to cope with new economic and social problems and opportunities.

The professions, even as we know them today, are now so bound by generations-old rules and regulations and laws that any suggestion of serious structural change is seen as a virtual assault. The historic codification of laws and legal professional practice is well entrenched, and is resistant to innovation. This rigidity is designed to maintain integrity and probity, as well as efficiency in firm governance. If the nature of products allows for constant and rapid change to match changing consumer tastes and fashions, the nature of professional services requires a measure of uniformity, consistency, and predictability. But now, there are cracks appearing in the wall.

Still, some things in the professions are different now than they were about a decade ago. We now have, for example, an increasing number of firms replacing hourly billing with value billing. Law firm governance is beginning to resemble corporate structure, and indeed, there is talk of law firms going public. Where once associates who seemed not to be partner material were dispensed with, now they are being kept for their specific talents and experience ' the so-called two-tier firm. Where once lawyers were totally aloof from the marketing process, they are now increasingly becoming active marketers.

These things didn't happen by accident, nor by just an inspiration by a few bright lawyers. They are the result of an evolutionary process ' which is change.

What, Exactly, Is Change?

In the context of professional services practice and marketing, change is alteration of a process or condition that varies from the past. Too many professionals see change as an event ' finite ' an end in itself. In fact, change is not an event that's arbitrarily made to happen, but a process, the result of which is changing something. Most often, and with exceptions and only in rare cases, that process leads to an evolution, and sometimes, even revolution (such as professional firm advertising, long forbidden ' now common).

Second, change in the professions and in marketing professional services isn't often deliberately made. It evolves slowly in response to external stimuli. Except for a few visionaries who anticipated the future in areas such as billing structures and firm governance, it most often comes in response to changing needs of the marketplace, which demand new practices and new structures to serve those needs. Electronic media, for example, wasn't invented to change the practice of law or accounting ' but it served to generate and facilitate change in those professions. And not overnight, either. It certainly was a response to the need to compete in an increasingly competitive market. Social media began as just that ' social. But it evolved into a competitive tool by virtue of its ease of communication to large numbers of people. It was useful because it circumvented the rigors of external control of message, such as happens in the print media, and has a broader and more immediate reach than does the traditional media. Opportunity, then, precipitated change.

Value Billing

A case in point is value billing, which has been touted for decades, and is only now emerging as a common practice. Firm governance, and the traditional top-down firm management that's long been the tradition in professional firms, is slowly, slowly emerging in new forms that better serve a practice's ability to help clients. Client service teams are emerging to replace the eat-what-you-kill culture, in which each individual in a firm is his or her own entrepreneur. On the horizon today is the corporately owned or public professional firm.

I point this out, not to carp, but to wonder, and to consider, how this process can be dealt with competitively, and whether there is an initiative that can be taken to stay ahead of the curve. And to note, as well, how frank marketing is affected by change.

There are two main areas in which change is imminent in the professions ' firm structures that allow a firm to better serve the evolving needs of its clients, and marketing that's consistent with the clients' changing economic environment. Both are necessary for competitive reasons, both are imminent in order to keep a firm relevant to the dynamic changes in the world of both commerce and society. (There are, at the same time, many changes that occur daily as a result of new laws and regulations, but changes these are promulgated in response to external factors that precipitated the new laws, such as Sarbanes-Oxley. A Sarbanes-Oxley, by virtue of the need for skills needed to help clients function under the law, is itself a major marketing tool.)

We live in a dynamic world, in which constant motion of events and social and economic structures continually alter the state of many activities and circumstances. For example, the advent of the personal computer in 1981 changed the way trade and commerce was done. This altered the nature of financial structures, industrial practices and communications. But it also gave rise to new laws and new needs in legal services and finance. It created a new business environment that affected all participants in the cycles. New financial instruments, new laws and regulations, new technology that accelerates the pace of doing business, growing internationalism, the expanding body of knowledge in so many areas and the rapidity with which it can be organized and retrieved, new demands from client ' all substantially change the demands upon lawyers and accountants, and therefore, the structures and practices that professionals must adapt to stay abreast of their own clients. All present new grist for the marketing mill.

I contend that any professional in that cycle who doesn't react to its dynamics will fall behind those who do.

Inhibitions to Change

There are many reasons for the resistance to change, not the least of which is the amorphous nature of professional services management and marketing education. The quality of academic and law firm marketing education in this field is dismal and retrogressive. The relationship between the marketers and the professional is often built on mutual misunderstanding. And perhaps because law firm marketing is so subsumed by a firm's professionals with too little understanding of the process that too many marketers are either unwilling to risk innovation or else are incapable of it.

Still, there are techniques to keep professionals relevant to the changing needs of the clients, and to keep marketing functional and successful beyond the mundane. For example, consider that while the ultimate aim of marketing professional services may be to get clients, growing a successful firm is a function of keeping a firm relevant to the changing nature of its economic environment, and particularly the needs of the clientele. Obviously, then the marketer must understand that environment, which then becomes the canvas upon which the marketing program is painted.

This is certainly true in professional services marketing, where recycling old ideas instead of bothering to come up with new ones, is a too common practice, and where the failure of professionals to fully grasp the reality of the crucial role that marketing plays in a practice tends to suppress innovation in so many firms.

Possible Changes in the Not-Too-Distant Future

Predicting the future course of events can be a fool's game, especially as an extrapolation of current trends and practices. Anticipating future events, by the way, doesn't work well by looking at current practices alone, and except as they are tempered by external trends. Lawyers and accountants, for example, didn't invent the Internet and the social media, both of which are now an increasingly important part of professional practice. There are several areas that seem to be inconsistent with the current changing environment. Some examples follow below.

The fragile partnership structure, which can slow down decision- making that should be responsive to changing economic decisions. What will replace it?

Law and accounting firm billing procedures, which may have a value in informing clients of the time spent in the client's behalf, but rarely reflects the value in the service performed. Value billing is emerging, but is still evolving. Who knows for sure which method will emerge as the standard?

Partner and non-partner compensation changed radically during the current economic turndown. What will it become as the economy recovers?

During the course of this recession, thousands of lawyers and accountants were discharged. What will be their availability as the recession recovers? What will be the shape of the accounting and law firms in the recovery?

Growth requires capital, which may be more than a firm's partners can contribute. Is the publicly-held law or accounting firm in the foreseeable future?

The shortage of brains and talent in the world today is too acute to continue the caste system in professional firms. Talented professionals may not be “partner material” (whatever that is). But the need for their skills suggest that in the future, firms may be structured on talent, rather than on traditional methods and requirements like rainmaking abilities and longevity (the two-tier system).

Today, law and accounting schools send their graduates into the world with little or no education about the economics of practice, nor an understanding of the crucial role modern marketing plays in firm management and growth. We see signs of change here ' but only in isolated incidents. That should change ' but how?

Despite three decades of experience in professional services marketing, remarkably little innovation seems to have occurred in its practice in recent years. Part of this is because of the random education in professional services marketing; part because marketing itself is an art form in the way it's executed ' and there are not that many artists. Yet another reason is the lack of formal education in professional services marketing, which is very different from product marketing. A significant factor is that accountants and lawyers have little foundation in how to hire and evaluate marketers, which often results in unsatisfactory marketing process, and failure to judge good from bad ' effective from ineffective.

Because of the disconnect between professionals and marketers, many marketers don't innovate, even in an arena in which all marketers have the same tools. The winners know how to use those tools innovatively; the losers do not. The marketers either feel intimidated by the stature of professionals, or don't know how to do anything except by rote. Perhaps time and competition will temper this situation.

Functioning in a Changing World

Several things beyond outright behavior modification can make it possible for both professionals and marketers to participate in the change process.

Learn to fathom those elements, both economic and social, that are currently changing. For example, new technology, including the new social media. Even if you don't plan to participate, learn it. You'll understand a great deal of the dynamics of new aspects of society and the economy. You'll spot trends.

Don't insulate yourself from the marketing process if you're a professional, or from the nature of law if you're a marketer.

If you're a marketer, try to understand the lawyers. This means the people, the lawyers, as well as the process. Their attitudes, their points of view on the clients, the way they think, their values. Don't try to turn them into marketers ' marketing is your job ' but rather teach them how to be participants in the marketing process. As a marketer, you're not going to change the professionals, but you can educate them within the context of their professions.

If you're a lawyer, you don't have to be a professional marketer, but you should know enough about the process to be able to participate in it as appropriate, as well as to understand the marketers and how their professional minds work. Ultimately, in a successful marketing program, you're going to have to participate in the process and in bringing the prospect into the fold. Learn how it's done. It's a process well within your training and experience.

Read the trade media, both the law and accounting trades and the publications serving the industries the clients are in. Not just for the news, but for the trends.

When you spot a trend, particularly one that veers from traditional professional practice (such value billing, or using client service teams effectively), don't make snap judgments. Even if you're not ready to bring them into your practice, they may eventually be right for you.

If you can't innovate, at least learn to respond to external factors that can affect your practice, your firm, and your clients.

Competitive intelligence is important. You should be aware of other firms and what they're doing that you're not, but should be. Or that may eventually be right for you.

Learn to question everything you do. Ask yourself the question, “This is the way I did it yesterday. Is it the best way to do it today?” You'll be amazed at the answer.

Is change a marketing tool? Absolutely, if understanding and dealing with it puts you a step ahead of your competitors. And remember, evolution is constant, and change is coming ' whether you participate in it or not.

Bruce W. Marcus, a member of his newsletter's Board of Editors, is a Connecticut-based consultant in marketing and strategic planning for professional firms, the editor of The Marcus Letter on Professional Services Marketing, (www.marcusletter.com) and the co-author of Client At The Core (John Wiley & Sons, 2004). E-mail: [email protected]. ' 2010 Bruce W. Marcus. All rights reserved.