CVM and CRM for lawyers
Why have CRM systems not worked for law firms in the past? Volume-oriented, consumer marketing people have not understood the unique nature of a firm's relationship with its clients.CRM systems are all about managing huge numbers of relationships statistically. The idea of most CRM is to load thousands of leads into a database, bombard them with a sales campaign and hope some of it sticks. It's based on the assumption that there are millions of customers out there, most of them are about the same, and the low response rate of an impersonal, untargetted email message will be cancelled out by the vast numbers that you send.
Can you imagine handling your client relationships like that? "Let's not bother about quality - it doesn't matter if we don't produce results for most of our clients. We have so many of them that we only need to create value for 3% of them."
Professional relationships aren't like that. Your job is to produce value in every single client engagement and your reputation depends on that. So if you want to increase your sales and grow your firm, you need a way to manage the value you create so you can scale it up. The way to do that is with the next generation of CRM system - designed specifically for professional services firms - Client Value Management, or CVM.
CVM provides you with a way to define and measure the value you add to each of your clients in every job you do. Value comes in several forms called value factors, which include:
Producing value for your clients
Your clients have certain objectives in their business which each represent a different combination of these value factors. These objectives might include: successfully completing projects without dispute; winning cases; completing on a lease or renewing a licence. It is actually possible to build a mathematical model of these business objectives and work out the total underlying value that is created by any project you undertake.CVM software is designed to create a model of these objectives - which are different for each client - and help you offer the right services to create maximum value for the client. In addition it helps you target the right price for each service and each client, so that you can get an appropriate share of the value created - usually more than if you charge on an hourly rate.
The result? You sell more services to each client, and charge a higher price for them. What's more, the client benefits from all this - because your services are designed and targetted specifically to add value for them, rather than being triggered only when the client thinks they need a contract negotiated or a letter written. Suddenly it becomes visible to the client just how much they actually gain from working with you. This can only be good for the relationship and will increase the amount of business they want to give you.
So if your goal is to increase your firm's revenues and you're sceptical about traditional CRM software - I don't blame you. Give some thought to a Client Value Management system and it might be the biggest single step that your marketing could possibly take.