In business blog

Unlocking lock-up days
Louis Baker and Steve Gale
Thursday, 9 February 2012

Lock-up is not something firms can afford (literally) to stick their heads in the sand about, yet the number of firms struggling with lock-up (unbilled work in progress plus debtors excluding VAT) is staggering.

Crowe Clark Whitehill surveyed over 60 law firms recently, asking them to input data based on their recent annual results (normally to March or April 2011). The survey contained a good spread of firms in terms of size, with small firms to firms with a turnover of over £100m all well represented.

One of the most surprising findings of the survey related to lock-up days - one-third of firms had lock-up in excess of 150 days, and the average number of lock-up days amounted to 130 days.

Excessive lock-up can have detrimental effects. For example, firm X has an annual income of £10m and debtors and work-in-progress of £4.1m. Its lock-up currently stands at 150 days. In crude terms this means that it takes five months from doing the work for a client to converting it into cash. During that time staff and landlords have to be paid and partners will have wanted their drawings. If the firm was able to reduce its lock-up by 30 days, it would improve its cashflow by over £800,000.

The options firms have for funding lock-up are limited: they borrow from the bank, partners contribute more capital themselves or the firm restricts partners’ drawings or distributions. Under the SRA’s Accounts Rules, a law firm is not permitted to act as a bank for its clients by holding client money for no good purpose. By allowing lock-up to build, however, the firm is effectively extending borrowing facilities to its clients. Although not prohibited by regulations, it is risky for firms to extend so much credit to clients given today’s economic environment and high levels of corporate insolvency.

That same economic uncertainty, coupled with regulatory pressures on banks, means that a firm’s ability to agree terms with banks on renewed facilities or secure further loans is unlikely to get easier soon.

Firms can help reduce lock-up days by:

  • Agreeing the amount to be billed ahead of time with clients
  • Discussing interim billing options with clients
  • Invoicing promptly upon concluding work (whether or not also billing on an interim basis)
  • Employing consistency when it comes to credit control; partners must be on board, disciplined and timely to help improve cashflow
  • Impressing upon fee earners/partners the importance of assuming responsibility for tackling lock-up and helping to collect bills. It’s best to maintain open relationships/discussions with clients about billing to ensure the process is a smooth one

Our survey showed that for many firms there is more they could do themselves to manage their cashflow better, and lock-up is clearly a challenge. If left unaddressed and financing from banks slows or is cut off completely, lock-up can quickly become a very serious problem.

Louis Baker (pictured) is head of professional practices group and Steve Gale is professional practices audit partner at Crowe Clark Whitehill

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Witnessing financial documents
David Pickup
Tuesday, 7 February 2012

A lady comes to the office clutching a mortgage and says it needs witnessing by a solicitor. She explains she is raising money to pay off the victims of her husband’s fraud. The solicitor advises her not to sign it and she goes off. The solicitor is later sued (probably successfully) for negligence.

A recent Court of Appeal case considers a solicitor’s duty when certifying a mortgage. A financial consultant persuaded his wife to sell the family home to repay money he had defrauded from his clients. She wished to avoid her children seeing their father sent to prison and she was advised to get independent legal advice but told to ignore any advice not to give up her rights in the family home. The lady went to another solicitors’ firm and was advised not to proceed with the transaction. This advice was given free of charge. A few weeks later she visited another branch of the same firm and a solicitor witnessed a document certifying that the wife understood her obligations. The husband later was sent to prison, owing considerably more than first believed. They divorced and she sued the solicitors for negligent failure to give proper advice.

The case was unsuccessful at first but the Court of Appeal ruled the there was a case to answer. The solicitor ought to enquire what was behind the wife’s intentions. The duty was the same irrespective of whether there was a charge for the work. Interestingly the advice not to sign was insufficient to discharge their duty. The solicitors should have investigated the true extent of the man’s fraud and advised that the wife’s actions would be insufficient to save him from prison.

We should not witness any financial document such as loan agreement, mortgage, deeds, etc. If we witness such a document it is implied that we have advised the client on the terms of the agreement and the implications of the agreement i.e. you could lose a house if you do not make payments.

To do the job properly would take an hour or two’s advice which we would have to charge for.

David Pickup is a partner in Aylesbury based Pickup & Scott

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The business of immigration 2012
Henry Oliver
Monday, 30 January 2012

Contrary to expectations this is going to be a good year for immigration practitioners.

When considering immigration lawyers’ prospects for 2012 we need to remember a lesson from Frederick Bastiat’s Parable of the Broken Window. Bastiat was a 19th century French economist, who taught us to look at what is seen, and at what is not seen.

A young rogue throws a stone through a baker’s window and runs off. A crowd gathers round and condemns the hooligan for his vandalism. But then one of them points out that this will stimulate economic activity. The baker will be forced to employ a glazier. And money will flow through the system. A murmur of agreement is heard.

Bastiat says the crowd sees the new window, so they assume this stimulates economic activity. What they don’t see is the suit of clothes the baker would have bought from the tailor. Although the same amount of money has been spent either way, the baker loses out on his suit in order to keep his window. So when we examine the prospects for immigration lawyers, let’s remember not to take things at face value.

It is the government’s policy to reduce immigration from the hundreds-of-thousands to the tens-of-thousands. There are going to be fewer people coming into the country. So the logic goes that just as the criminal bar would have a difficult year if there were fewer criminals, immigration practice will have a difficult year because there will be fewer immigrants.

But what is not seen is the increased competition between immigrants for visas. Because they will become more scarce, the value of each visa will increase: the greater likelihood of success associated with representation will be enough of an incentive for people to use lawyers.

And we are likely to see more refused applications, and more appeals. The recent introduction of fees for appeals to the First Tier Tribunal will deter some; but others will seek experienced practitioners to minimise the risk of their money going to waste.

Work will increase in this area as people become increasingly inventive about how to appeal Home Office decisions. There have been a lot of Article 8 cases recently that have caused concern in the media, most notably because one case reportedly said that playing cricket is enough to win on private life grounds.

Whilst this is an obvious exaggeration, it does illustrate the point that there are other ways for immigration lawyers to earn their crust. The last way in which work will increase is specialisation. Few areas of law change as quickly and as frequently as immigration. And with new policies, changes to the Immigration Rules, and conflicting case law, people will have more need for lawyers.

Keeping one eye on the most recent developments in case law is a particularly good way of knowing how to add a winning touch to visa applications; citing recent decisions from the Upper Tribunal or the Court of Appeal or Supreme Court can make all the difference. Especially where human rights are concerned, an alert and intelligent lawyer will be able to think tactically and succeed on discretionary grounds.

And even though the Legal Services Act 2007 is liberalising the market, immigration can still only be practised by ‘qualified people’ under the Immigration and Asylum Act 1999. Although the Legal Services Act 2007 might eventually lead to a wider pool of qualified people, and challenges from providers with established brand presence and customer loyalty, there are no signs that this is going to happen in the near future.

So remember, when the government closes a door your lawyer can open a window.

Henry Oliver works at Mulberry Finch, an immigration and employment practice on High Holborn, London

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Your personal new year financial review
Louis Baker
Tuesday, 24 January 2012

In his November Autumn Statement, chancellor George Osborne confirmed the difficulties the economy faces and effectively emphasised the need for partners to reappraise their financial planning and the tax-efficiency of their finances. There is no better time to do this than at the start of the new year! Here are some strategies and points to keep in mind:

Pension contributions 2011/12

Pension contributions are one of the most tax-efficient long-term investments partners can make, and the rules for the maximum contributions that can be made tax-effectively changed from 6 April 2011.

Tax relief is now restricted to pension contributions of up to £50,000 a year (the new Annual Allowance (AA)). This figure is the gross equivalent. Contributions are paid net of a deemed withholding of 20% basic rate tax. The tax relief available is confirmed to be at your marginal rate.

Any unused AA is carried forward for up to three years for future use as long as you had a fund in existence in the earlier years. The three-year carry forward rules mean that some partners might be able to invest up to £200,000 (gross) into their pension arrangements and obtain 50% income tax relief thereon.

Lifetime allowance change and election

A lower lifetime allowance (LTA) of £1.5m (reduced from £1.8m) will apply from 6 April 2012. Partners have until 5 April 2012 to make an election for the old £1.8m LTA to continue to apply - this election can only be made if you then cease to make any further pension contributions.

Pension Input Periods (PIPs) - important hidden detail

The AA applies to contributions paid in a pension scheme’s PIP, which ends in the tax year. Each of your pension arrangements will have their own PIP and their annual period end may not be 5 April each year. If they have a different end date this may give rise to problems.

Unfortunately, many don’t know the annual year-end of date of their PIP, and the immediate concern is that your scheme PIP which ends in 2011/12 may have already ended! So, contributions you make between now and 5 April 2012 may use your 2012/13 AA rather than your 2011/12 AA. You really do need to know your PIP when determining your contributions over the next few months - particularly if you are looking to use your three-year brought forward capacity.

Other tax-favoured investments - ISAs, EIS and VCT

Each adult is able to invest up to £10,680 into an ISA (Individual Savings Account) each tax year. There is no tax relief on the investment. The attraction is that any growth is Capital Gains Tax (CGT) free and income in the fund is exempt from income tax, as are dividends or interest distributed out. Subscriptions into EIS (Enterprise Investment Scheme) qualifying shares are tax-favoured investments. 30% income tax relief is available on such investments of up to £500,000 each tax year. There are also CGT and Inheritance Tax (IHT) benefits. Investments in Venture Capital Trusts (VCTs) of up to £200,000 each tax year generate 30% income tax relief.

Gift Aid - are you getting your full tax relief?

Many know that charities get basic rate tax relief refunded from the government on donations made via the Gift Aid scheme. What seems less well known is that partners are entitled to higher rate tax relief on their Gift-Aided donations (when claimed via their tax return). High-earning partners can thus get 50% tax relief on their donations, which might motivate some to be more generous, and others to be better at recording the Gift-Aided donations they make.

Partners retiring shortly

Partners about to retire should pay particular attention to whether their tax rate will be lower in retirement or in the lead-up to retirement. This may provide added incentive to increase pension contributions and to accelerate Gift Aid contributions, before their income level and marginal tax rate falls.

Spouse planning

This relates to financial planning within the family structure, rather than relationship planning. Where one spouse has a lower tax rate than the other, then investment income (interest or dividends) suffers less tax if the asset is held in the name of the spouse with the lower tax rate. Conversely, Gift Aid donations are more tax-efficient if made by the more highly taxed spouse.

Use of the annual CGT exemption

Each of us has an annual CGT allowance of £10,600. This enables us to realise gains of £10,600 in 2011/12 tax free. As spouses can transfer assets between themselves CGT-free in most instances, it can be possible to realise gains of £21,200 tax free between them.

CGT main residence elections

A capital gain on selling your sole home is tax free if it and its grounds do not exceed half hectare. Where you own two residences, for example a holiday home or midweek flat together with the main home, the main home will continue to be exempt. However, dual exemption for a period can be engineered on more than one residence where an election is made within two years of acquiring the second home. If this might apply to your circumstances, speak to your tax advisor.

Non-domiciliaries

The chancellor confirmed in November that the charge for a non UK-domiciled individual to be assessed to tax on the ‘remittance basis’ would increase to £50,000 (from £30,000) once they have been resident in the UK for 12 of the previous 14 years. This change will be effective from 6 April 2012.

Statutory residence test

Early in 2011 the chancellor announced that he would consult on the introduction of a statutory residency test from April 2012. The proposals in the consultation document were generally well received, but it has been concluded that due to drafting difficulties, the introduction will be delayed until 6 April 2013.

Louis Baker, head of professional practices group at Crowe Clark Whitehill

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Management priorities
Monday, 23 January 2012

As we look forward to 2012 and the challenges that solicitors’ firms face I would suggest they need to think carefully about their management priorities for the coming year. Direct competition for the domestic, small business and corporate client groups will become more visible as new businesses (alternative business structures or not) set their market entry strategies in motion. Solicitors' firms need to get the basics of marketing management and promotion in place before they can fully engage in the competitive market. Everyone in a firm has a marketing role to fulfil but how can this be quickly achieved and managed in a systematic way that is acceptable to everyone?

For the past few weeks I’ve been working with a firm to sort out what it is that they say to clients about the services they offer. What we are driving at is organising the firm to consistently present the benefits of their full range of services in a systematic approach. The end result will be a comprehensive set of promotional and informational brochures or leaflets that everyone in the firm can use easily and quickly. The content will be in print or pdf file format and reflected on their website. Simple promotional marketing stuff you may say, however it is the process of producing this promotional material that is more important, along with how it is then used.

The new competition, current and yet to come, are marketing lead organisations. They (attempt to) understand their target market groups and present their services according to the needs of each group. The process with a solicitors' firm is to understand who their profitable clients are, what services the firm offers and how to consistently present meaningful benefits in all suitable situations. The management priority is to simply write down what they do in terms of benefits to clients and then tell the clients in the most appropriate way.

Partners, fee earners and staff in general practice high street firms understand that there are many different groups of clients within each area of legal service. That's obvious you may think, but while many know this, they rarely act on it or tailor their services accordingly to attract the most profitable clients (and therefore reduce the lower margin clients). For example, there can be three broad domestic conveyancing markets, first-time buyers, family movers and the elderly sellers. For businesses, there are differences for small and medium-sized, and larger businesses looking for employment law advice. Grouping current and potential clients into smaller meaningful groups helps a firm present the right benefits to people that can appreciate them. Each client group is looking for a different set of benefits for the same underlying legal advice service.

Once the process has identified future client groups, the firm and the fee earners that deal with clients each day need to understand the benefits a client is receiving. Each service presented to a distinct target client group should have a specific set of benefits. That’s not features of the service, we have local branches, expert solicitors and competitive fee rates, but the benefits that these features deliver. Convenient access to your solicitor that saves you time, with expert solicitors that understand your needs, all at a cost controlled by you.

Benefit needs to be qualified by a ‘so what’ question. If you think you’ve got a benefit statement for one of the services you offer, can the client say ‘so what?’, ‘what does that do for me?’ If they can, you need to think again about the benefit.

The process has now identified clients groups and listed the services the firm offers in terms of benefits the client will receive. The next step is to turn it into promotional material that means something to the target client group, that’s been generated by and agreed upon by the firm and they are happy to use.

But that’s not the main point, the process of looking at the firm from the clients’ perspective means fee earners and staff increase their ability to gain profitable work. The management process needs to continue by regularly reviewing the process to ensure the firm stays competitive to new market opportunities or threats. From this point a firm can build up other promotional methods with confidently. Web and search engine optimisation, email promotions, seminars and all the fancy stuff often mistaken for ‘marketing’, becomes easier once you have the basic marketing management in place.

Alastair Moyes is a director at Marketlaw and co-author of Marketing Legal Services, the current marketing handbook from Law Society Publishing.

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Money and clients in 2012
David Pickup
Tuesday, 17 January 2012

There has been a bit in the press recently about the rush of clients we get the first day back at work after Christmas. It is a busy time for family lawyers as sadly there are many people wanting advice about divorce. I do not think it just that people are forced together for a long period. It is also that people have time - perhaps too much time - to think about their lives. It is not only divorce but other types of work increase. The dark days and ice bring accidents and there are sudden deaths as well as more criminal work.

None of this January rush changes the fact that this year will be tough for lawyers. We have the legal aid cuts and the fact there is less going on. Fewer people are moving house, setting up businesses, doing deals and getting married which will all produce work in the future.

Money is the root of all evil and the source of many problems for us lawyers. We need to increase money coming in, get it more quickly and more of it, and try to reduce the haemorrhaging away. Easier said than done.

Governments can make 'efficiencies', meaning cuts, but it is difficult for small firm to make savings. We have all for years been trying to save money on stationery, post, insurance and the rest. The biggest bill is staff and we know too well that it is not just wages but all the extras like training, NI, holiday and leave cover. In a small firm everyone does a slightly different job. If you have 10 conveyancers it is easy to cut two but if you have 10 people doing different work it is more difficult.

I have not noticed a rush to merge like in previous times of recession. I do not really think there are economies of scale in the legal profession. What I have noticed is that firms work more closely together. We do one type of work that next door does not, and so we send clients there, and they send us work back.

What we cannot plan for is the unexpected. This year we have already had problems with the Legal Services Commission paying the contract money. We were notified after 4pm the day before the money was due in. If we had been told 30 minutes earlier we could have delayed the payments which we needed to make. It is all reminiscent of the problems two or three years ago when firms had drastic reductions in their money at very short notice. I have been reassured this was a one off problem.

Let’s hope so. Anyway, happy new year.

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ABSs - unsettling times?
Robert Bourns
Thursday, 12 January 2012

The new year begins (as 2011 ended) with a discussion of the impact of alternative business structures (ABSs) on the profession.

At last, the Solicitors Regulation Authority is authorised to accept applications and license ABSs. It is reported that 10 firms have submitted applications so far. A modest beginning. No doubt others (both existing firms and new entrants) are developing their plans and will come forward during the year.

As discussed ABSs will become just another vehicle through which practitioners may choose to develop and provide legal services. There will continue to be sole practitioners, partnerships and LLPs. As before, the decision as to which vehicle is most appropriate will turn on a number of factors including the area of practice, nature of the client base, the size and spread of the practice, its ambitions for the future, capacity for investment and ability to provide returns on that investment to a range of stakeholders.

While some regard ABSs as anathema and unwelcome, there is no reason to judge a solicitor working within an ABS as less professional, fit or capable of discharging his/her obligations in respect of the mandatory Principles and Outcomes established by Outcomes Focused Regulation (OFR), than peers carrying on practising in any other form. Objections raised by reference to such an argument are wrong and draw an unnecessary demarcation line between professionals with a shared enthusiasm for providing legal advice and service with integrity, serving their clients' interests in a manner that the clients value.

We are now well used to talking of law firms as entities in their own right, developing their identities and brands. Some with spectacular success, others less so. Regulation of the "entity" is developing and we will soon have compliance officers for legal practice (COLPs) and compliance officers for finance and administration (COFAs) in place. Therefore it is logical that much of the current commentary speaks of the opportunities for the firm or business, frequently linked to speculation about particular named firms.

There is perhaps little consideration of the impact on the individual, other than daily offers from trainers and consultants to manage performance or manage out individuals who fall short of the mark. On the other side of that coin are the reports of transfers, team moves and lateral hires. An ongoing process as firms seek to build market share, focus on particular regions, industry sectors or service lines.

There are also moves prompted as unintended consequences of other steps taken by the practice. Individuals working at any level and in any area of a business have their own expectations, ambitions for their careers, together with opinions formed over years through training, observations and experience. Solicitors may have been working towards "partnership" as recognition of their excellence/achievement and may not understand or be keen to remain an employee, whatever the title, sharing ownership or profit with other non-legal professionals.

Other professionals working in and contributing to the success and resilience of the firm (in finance, IT, information services, business development or human resources) may be encouraged by the opportunity to take a stake in the firm, alongside, and some ahead of, their solicitor colleagues.

Some may be turned off by the prospect of working in a business whose ownership is intended to change (investors look for and plan exits) without reference to them. Others may see ABSs as appropriate to a particular type or way of working. If not currently associated with that part of the practice, they may feel a lack of support and personal opportunity. They may also feel a lack of loyalty to the practice. As an employment lawyer, I have advised a number of professionals (accountants, surveyors, engineers as well as solicitors), who have felt their loyalty to their current employer/firm weakened by the effects of recession - salary cuts, lack of promotion, redundancies, discrete exits, increased pressure all take their toll, increase scepticism and make them more inclined to move rather than bear with it.

In short, advancing the business of the firm to make the most of the real opportunities arising from changes in regulation and the permission of ABSs, will risk the loss of clients (some of whom may object to a change in the ownership of the firm they instructed) and, more relevant to this article, people.

This emphasises business risks, many of which are familiar to practitioners, the loss of good people, with relevant expertise, strong client relationships and knowledge of the way in which the firm operates. Increasingly this risk may also attach to the loss of management knowledge and expertise. How will we respond to the risk of the loss of a COFA, COLP, director of IT or business development?

Our Principles (Biblical/SRA Handbook reference - Principle 8, Chapter 7) require us to manage our business effectively with proper risk management systems.

Effective explanation internally of what the firm/business is doing (by act or default) remains vital. Most firms have highly developed and effective lines of communication (a two-way process) within and across their practices.

The current environment provides an excellent opportunity to consider who is looking on (clients and our people) and focus on those delivering services to the clients, explaining why the firm is taking a particular course and ensuring that they continue to feel they have a stake in its continued progress.

Nothing new under the sun. Change provides opportunity, but is also unsettling.

Robert Bourns is senior partner at national law firm TLT

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Should doom merchants have gone to Specsavers?
Catherine Baksi
Friday, 6 January 2012

With the new year came the long-awaited announcement that the Solicitors Regulation Authority has begun processing applications from companies looking to become alternative business structures.

This date has been anticipated by many law firms with trepidation, as some commentators have predicted that the advent of ABSs, which enable non-lawyer owned companies to offer legal services to the public - so-called Tesco law, will mark the beginning of the end for independent high street law firms.

But a data analysis on the impact of competition in the optometry market gives some cause for hope to lawyers.

Comparisons are often made between the optometry and legal services markets, striking fear in the hearts of high street law firms, with the assertion that following the ABS revolution the legal market will go the same way as the opticians market, being left with only a handful of big players. In the case of opticians Boots, Specsavers, Vision Express and Optical Express.

Law firm network Simplify the Law, which launched at the end of last year, commissioned research from an optical consultancy and market research company SWV, to examine the impact of competition in the optometry market.

Jonathan Brewer, co-founder of Simplify the Law, explained that in 1985 the Opticians Act, which had provided a legal monopoly to opticians for sight tests and the dispensing of spectacles, was repealed in the hope that new competition would increase consumer choice and therefore reduce prices and increase value for money.

At that time there were 3,500 independent optical outlets enjoying 65% market share by revenue. A further 2,250 outlets were already part of small chains, with the largest provider and first mover Dollond & Aitchison, offering its branded services through 452 outlets and Specsavers through 10.

So, twenty five years on, how many independent opticians are there? My guess was about 500.

But the somewhat surprising answer, according to the research, is that in 2010 there were in fact 3,790 independent optical outlets.

So despite the money spent by new entrants to the market as well as the more established brands like Boots deciding to join, the number of independent operators actually increased, showing that many consumers of optical services and equipment continued to choose their independent local optician rather than a big brand.

Which, says Brewer, is good news for law firms.

However, before managing partners sit back with a sigh of relief, Brewer points out that there has been a significant change in the market share and overall revenue of the independent opticians. The market share of independent opticians has fallen from 65% in 1985 to 27.5% in 2010, while the market itself grew by 80%. And their revenue has reduced by 40%.

Brewer notes that the independent firms missed out on the huge growth opportunity presented by competition, while the growth was generated by the four retailers named above that poured the most marketing money into their ventures.

The message of hope for high street firms from the optometry market, according to Brewer, is clear - there is a place for independent law firms in the new legal landscape, providing they can lower their cost base sufficiently to withstand the downward pressure on price that usually accompanies greater competition.

There is, he says, greater hope for those with the means to innovate and market effectively. He comments that the growth in the optometry market was not because the nation’s eyesight suddenly got worse, but because the advertising by new entrants opened people’s eyes to the benefits of proactive eye care, the utility of plastic lenses and disposable contact lenses, and the opportunity to use glasses as a fashion accessory to improve your looks.

Brewer does not pretend that legal advice will ever improve the way a clients looks, but he says the increased awareness of legal issues generated by the advertising by new big brands and legal franchises, may encourage individuals and businesses to take a more proactive stance with regard to their legal health.

Obviously there are differences between the optometry and legal markets, but the comparison shows ABSs with big brands may not spell doom and gloom for high street firms - at least for those who are prepared to take positive action.

Catherine Baksi is a reporter on the Gazette

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New year resolutions
David Pickup
Tuesday, 3 January 2012

I was ill just before Christmas, which is not a good time to be off for various reasons. I will not bore you with the details but it was unpleasant. However, it gave me a chance to get up to speed on the mysterious world of daytime television. Most of the advertisements are for people who, well, put simply, are stuck at home. There are plenty of advertisements offering advice on the various ailments that persons of a certain age are likely to suffer - mostly toilet related.

There are also lots of advertisements for making claims of different types of claims. I expected that but not the number of different claims firms. I could not tell which were solicitors and which were another breed of claimers. I am sure they are fine upstanding firms in many ways but they all look the same and have similar sounding names. If you have had an accident, or been mis-sold something how does the victim decide which one to use?

Fortunately I recovered to enjoy more festive television, which in the lead up to Charles Dickens’ anniversary featured lots of Dickensian lawyers. Grim-faced men with lots of facial hair, quill pens and simpering clerks. How things have changed. We now have computers not quill pens.

My point, if you were wondering, is that the public’s concept of lawyers is either claims firms or Great Expectations. An exaggeration I know but there is some truth in it. Doctors have exciting, glamorous programmes about emergency units; even vets get a better press curing cuddly animals. Which brings me to resolutions. Scrooge in A Christmas Carol vowed to live in the past, present and future.

So those are my resolutions. Firstly the past: I will prepare for Christmas better next year. I will give more time, write cards, see people and all the rest. I know I will not but I ought to. I will also enjoy the heritage we have as lawyers. We have a history of service and occasionally as a profession, firms, or as individuals, get it right and make a difference to someone’s life.

I will live in the present. I will plan better and work efficiently. I will say 'no' when faced with a client asking me to handle a case in an area I am unfamiliar with. I will know what is going on, what is in colleagues' in-trays, filing cabinets etc. I will encourage an atmosphere of openness. Yes, dear reader, you do all those things now.

I will live in the future. I will think how IT, whatever that is, can help. I will ponder about what services the public want. I will encourage youngsters to enter the law if they really want, not because it is a quick route to fame and fortune but because it is a great profession.

David Pickup is a partner in Aylesbury based Pickup & Scott

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Grinch Lawyer Syndrome?
Chrissie Lightfoot
Friday, 23 December 2011

As Christmas comes but once a year, I’d like to share with you now a simple verse: 'And the Grinch, with his Grinch-feet ice cold in the snow, stood puzzling and puzzling, how could it be so? It came without ribbons. It came without tags. It came without packages, boxes or bags. And he puzzled and puzzled 'til his puzzler was sore. Then the Grinch thought of something he hadn't before. What if Christmas, he thought, doesn't come from a store. What if Christmas, perhaps, means a little bit more...'

The above is a verse from my absolutely favourite piece from the Christmas movie The Grinch. You may be thinking where’s Chrissie going with this? So, here’s my take on it...

'And the Grinch Lawyer, with his Grinch Lawyer-feet ice cold in the snow, stood puzzling and puzzling, how could it be so? They used to come without ribbons. They came even in rags. They came with bribery packages, gift boxes and loadsa cash bags. And he puzzled and puzzled ‘til his puzzler was sore. Then the Grinch Lawyer thought of something he hadn’t before. Why don’t clients, he thought, simply walk through the door anymore? What if clients, perhaps, are opting for more. And whilst scratching his puzzler to the very core, trying to figure out how to give clients much more, Grinch Lawyer began to experience a fuzzy feel, as he mumbled and grumbled... WHAT'S THE DEAL?'

As the Grinch begins to understand the true meaning of Christmas I liken it to us lawyers understanding what our clients are really all about and what the true meaning of extraordinary customer service actually is. Have you ever found yourself thinking, feeling and suffering with Grinch Lawyer Syndrome? I have...

Three years ago I was sat at my sparkly desk in Grinch Lawyer Ivory Towers R Us Lair, *hands cupping face and elbows supported on desk*, staring at the office door, glancing every now and again at my email inbox, the telephone and my mobile phone. After a while, I realised that the new legal world order had actually kicked in and things were definitely not going to return to the way they used to be. We were in a new enlightened digital consumer age. Clients weren't simply going to walk through the door anymore.

What to do when clients are opting for more, I thought? What is more? Why do clients go somewhere else? Who do they go to? Where, when, why? What do clients really want?

Let me share with you now a secret in true Spice Girl style - I’ll tell you what they want, what they really really want. For some of us, it will come as no surprise, but for others it may be rather enlightening... I read a recent survey (research report published October 2011) by Peppermint Technology - only a couple of months ago - entitled What Clients Really Want from a Legal Service Provider. It is the first fully comprehensive research into the role of the customer experience in legal services, post the Legal Services Act.

Obviously, I cannot share with you the entire findings (copyright ‘n’ all). You will have to read the report for yourself. But, I believe I can share with you one wee part of the report, a particularly intriguing piece, no less. The survey report asked a series of questions to law firms, consumers and businesses. Here’s just one example, I think, that will help us understand what our clients would like for Christmas, and beyond.

The following question was asked to consumers and businesses (buyers) of law firms (suppliers): 'If you were purchasing legal advice how important are these factors?'

Respondents then had to rank six factors in order of importance. One of the six factors to be ranked was 'they have a trusted brand name in relation to the law firm' - brand/firm.

Upshot? Businesses ranked 'they have a trusted brand name' LAST; consumers ranked it fourth from last.

This confirms what many people outside the legal profession (and arguably legal industry and legal market) have long since suspected, meaning, clients couldn’t give a rats about brand/firm. Law firms have zip visibility in terms of their firm brand names and have been wasting their marketing budgets for years on brand/firm activities.

The research findings also confirm what entrepreneurial lawyers of the super lawyer kind, whom I wrote about back in May 2010, realised (The end of lawyers? Pah! This is the time of the ‘super lawyer’), namely, that what clients really really want is brand/you. How can I say this with such confidence and conviction? The number one ranking for businesses with regard to answering this particular question was it was important to 'know and trust a lawyer that works for the firm and for consumers it was 'the quality and promptness of customer service'.

Ultimately, brand/you trumps brand/firm in the clients' heart and mind. Brand/firm is an entity. It can only have personality if it has a human being (us) breathing life into it. The client is telling us that brand/you is the oxygen to the lifeblood of brand/firm.

At the very heart of what the client wants is the need for us to extol our soft skills, emotional intelligence, engaging behaviour and extraordinary ‘giving’ focus on them through our brand/you; the elixir for knowing, trusting, quality and promptness of customer service. What do clients want for Christmas? Grinch Lawyer, or super lawyer? I’ll leave you to reflect on what I’ve shared with you here. It just may help to snuff out Grinch Lawyer Syndrome.

May I take this opportunity to thank you for getting involved in my posts throughout 2011 and I look forward to engaging with you in 2012. I wish you all the most wonderful and super Christmas.

Chrissie Lightfoot is chief executive at EntrepreneurLawyer

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