Building a brand won't buy you a reputation

Competing solely on price is not sustainable, says Paul Bennett

The failure of law firms like Challinors and Blakemores has thrown the West Midlands legal profession into the spotlight.

As lawyers, we can learn much from other sectors of the local economy, which has changed beyond recognition over the last half century. Traditional high street stores have struggled to compete against the convenience and cost of supermarket shopping and, more recently, internet shopping.

Yet those same supermarkets build an understanding of our buying patterns and lifestyles through loyalty schemes. At my firm, knowledge of our clients is just as important as our knowledge of the law. A deeper understanding of clients enables us to deliver a proactive rather than reactive service.

Where we enjoy the right kind of relationship, we are more likely to fill the role of trusted adviser, and with that level of trust we enjoy client loyalty and can focus on delivering a value-added service. This is particularly important in the small and medium enterprises and owner-managed sector, which accounts for the majority of our work.

Law firms have become obsessed with building brands, either through consolidation or models such as QualitySolicitors. Although a brand may be recognisable, a reputation is a far more valuable hallmark. All firms aspire to consistency across their disciplines, but in practice people buy people and many clients will buy based on personal chemistry and perceived skill.

The law is the same irrespective of which law firm a client uses. In a fiercely competitive environment, service differentiation is key. The retail experience demonstrates that better quality and a more genuine understanding of client need can be found at smaller independent operations, and consumers will not simply opt for the cheapest alternative.

Such businesses are also embracing organisational change. At the heart of most successful manufacturing businesses will be a skilled management team embracing modern management and production methods.

More and more law firms are adopting these principles with process mapping of routine transactions to eliminate variability and waste. Such systems may lend themselves to lower-skilled staff and a lower cost-delivery model with more widespread use of paralegals.

Clients who have had to embrace an efficiency revolution in their own businesses are challenging a time-sheet culture that does little to eliminate waste and provide customer value. Lawyers must operate more efficiently, but the flip side of lower costs can be a lack of reliability and poor quality. In manufacturing, work is now being won back through onshoring of production previously lost.

The legal profession is undoubtedly in a period of transition. There are still too many firms who are looking to differentiate solely on price. Such behaviour is disruptive and is unsustainable in the longer term not only for the firms concerned but for the wider profession.

The manufacturing sector of the West Midlands is experiencing a renaissance. Many jobs have been lost, but it has been survival of the fittest. Strong management, efficient delivery, balanced with a valued added, relationship based ethos is just as potent a combination for a renaissance within the legal sector. More attrition is inevitable, but the legal profession is likely to be more robust and sustainable as a result.