So many professional service firms we meet bemoan the track record of most of their folk in developing new work and new clients in attractive niches. More than occasionally a practice leader confides that their technically competent team knows only how to “feed on the carcasses I kill” or “live like a leech on me”.
Want things to change? Well remember the management consulting mantra is “if you can’t measure it, you can’t manage it”.
What gets measured attracts attention. If you want more of a particular behaviour or contribution, make sure you notice it, then recognise and reward it. Make heroes of those who do business development effectively. All tough to do, except anecdotally and sporadically, without tracking and dimensioning performance.
Here are some client relationship and business development metrics worthy of measurement. They will help you notice what matters.
Client relationship management:
- fees under management, exclusive of personal billings – that is, contribution to client retention and development beyond personal fee benefit
- fees under management, outside personal billings and own workgroup – that is, contribution to management of client relationships outside direct workgroup under supervision
- fees under management, outside personal billings, own workgroup, and practice group – that is, relationship management value contributing to the rest of firm and indicative of spread of fees and services.
These are relatively easy to measure.
You may not track the data for others, but it’s worth doing if you want to dimension and reward – then get more – new business.
Client development – new business:
- new clients introduced/sourced – fee value this year, fee expectation next two years, fee potential next two years
- new work/types of matters from established clients – fees relating to classes of business not previously sourced from this client – fee value this year, expectation next two years, fee potential next two years
- win-backs – that is work won back from key competitors – value of current year fees, expected next two years fees sourced from named competitors
- new services selling – that is current year fees and expected next two years fees from new services availed by both established/new clients in target areas.
Activity emphasis achievement:
- tracking current year fees and expected next two years frees deriving from specific “emphasis” services – for instance, if environmental law is one of/the agreed service emphasis for next year, fees relating to that activity.
Too often, in our quest for objectivity, we measure only that about which we can be absolutely accurate and precise. However, we can get a quantitative handle (not to mention all the qualitative indicators) on aspects of performance which matter as much – and sometimes more – than the readily accounted and measured.
From a financial forecasting and future strategic health perspective, these metrics can be useful. To manage and promote business development and fee formation, these measures will help you establish contributions of an individual.
We can help with expert advice to create business development metrics which matter to your firm.
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