It’s not always easy to position professional services businesses…
…maybe we’ve been missing a trick?
Archive for 2010
The Actuarial Song
24th November, 2010Cellar Club Event: How Facebook and Google can keep you out of jail and help leverage brand.
19th November, 2010Last night we hosted the third of our Cellar Club events – this time in a new ‘Cellar’, the rather impressive vaults at the RSA. For those of you who asked, the vaults were originally designed as river-front warehouses, presumably by John Adam himself.
Despite our own team being decimated by the rather nasty ‘flu virus going around, we had a good turnout with colleagues from law, insurance, property, recruitment, accounting, media and financial services represented. Everyone I chatted with seemed to be busy and cautiously optimistic about the business environment.
Giles Watkins*, from Concentium was our speaker.
His excellent talk on privacy matters was a relaxed (but slightly scary) walk through the world of privacy – in particular how businesses need to be aware of and prepared for the risks of privacy breaches and the increasing vigilance and often severe responses of lawmakers to such breaches. Giles cited a number of recent examples of businesses sustaining substantial fines and reputational damage following almost ‘accidental’ leaks of customer information – incidents that could, seemingly happen to any business at any time. He also pointed out that there is little consistency across jurisdictions as to how these breaches are regarded by law makers.
Giles finished on a positive note by saying that he believes that ultimately the approach you take should be common-sense based but that businesses can benefit from being prepared through increased brand trust and capability for dealing with complex data issues in a more innovative way.
Thank to all for coming: our next Cellar Club event will be happening in March 2011 – details to be announced soon.
Ben
*Giles recently founded Concentium, a boutique advisory firm operating on the boundary of business and technology helping organisations to close the chasm between the two. Before Concentium, Giles had a 21 year career in top-tier consulting with Ernst & Young, founding and leading Ernst & Young’s Technology Due Diligence and Post-Transaction Advisory practice, which became the largest such practice in the world.
Which PE firms have the best reputations?
09th October, 2010Gracechurch is currently out and about presenting its 2010 Global Private Equity study to the leadership teams of some of the major global PE firms. The 2010 study follows on from the inaugural baseline study in 2008.
The study was conducted in partnership with HawkPartners www.hawkpartners.com
It comprises in-depth interviews with 350+ investors, intermediaries and corporate executives. This is a major study which profiles the key players in detail – analysing key stakeholders’ opinions of the firms in terms of their perceived strengths and weaknesses.
Leading firms use the research to plan and develop their reputations and to create focus around stakeholder communications programmes.
The 2010 study evidences a more mature sector where firms have moved beyond their entrepreneurial roots, positioning themselves as more mainstream financial players. Stakeholders are placing greater emphasis on integrity and trust and the best players are showing brand attributes that clearly set out what they stand for.
This is not to say that the sector has yet thrown off the negatives that have affected it’s development; there is significant room for improvement on transparency, governance and the quality of communications with investors. And there are instances of individual firms whose poor reputation scores are likely tainting the whole sector.
Unsurprisingly, brand distinctiveness is hard to come by, with most differences being explained by size rather than stand-out attributes. There are several obvious themes that PE operators could major on: operational effectiveness, is one example of an emergent theme that is salient for investors. But if firms want to own this space then they really need to work harder on their communications to cut through to the investors.
We are working hard to ensure that PE management teams use this research to really focus on their core values and champion the idea that strong brands really matter.
Investors in particular have clear ideas about what they like and don’t like and the firms with the most compelling brand stories will find huge benefits accruing, not least the ability to raise funds, create successful investments and ultimately benefit the whole industry.
One message that has been getting through to our subscribers is that a strong brand helps protect against your whole reputation being trashed on the basis of one bad deal.
Trust in the Cellar
07th May, 2010A big thank you to Tony Angel for leading the conversations at our first ‘Cellar Club’ networking event last night. We all enjoyed his talk on ‘Trust after the banking crisis’ and the difficulties we now face regaining and maintaining trust in the post credit-crunch environment.
Of particular interest was his list of seven points to help organisations regain that trust from their customers and employees. Key to these were exhibiting transparency and integrity, backed up by good corporate governance and regulation.
The other interesting point which emerged from a comparison of his times at Linklaters and now at Standard & Poor’s, was the relative involvement of Partners when compared to the Board members at a corporate. It seems that Partners feel more at liberty to challenge the senior team on issues concerning the running of the firm than do their corporate counterparts. While I am sure there were times when these challenges were awkward to deal with, Tony did comment that it gave him an excellent all-round view of the business at Linklaters.
We’re all looking forward to the next Cellar Club in July and hope you are too!?
Will the BLP/Thames Water deal trigger a bunch of copycat outsourcing arrangements?
23rd April, 2010The legal press has reported that BLP are finalising a deal to outsource the bulk of Thames Water’s legal work, taking on most of the TW legal team as part of the agreement. In so doing, they will knock out a bunch of competitors, and secure a workstream of several £m for the next 5 years.
John Bennett who has pulled off the coup rightly described it as marking a paradigm shift – but will it start a craze?
There seem to be two opposing views amongst our clients. The first, maybe the majority view, could be characterised as saying “Why would we want to dilute the quality of our people with all these in house lawyers. Sooner or later we will have to fire them and use our good people doing all the crap work that comes with the deal”
The other, especially those with more experience of outsourcing businesses say “it will be the way forward and those making the moves now will gain a big early mover advantage. The churn of people is the natural mechanic of outsourcing – but not all the people will be poor quality. Along with the work we may get some great people too”
The debate brings to my mind an old adage:
“Some people make things happen; others wait for things to happen; the rest wonder what happened!”
Is the leading law firm DNA pool too narrow?
23rd April, 2010Top law firms are under increasing pressure to diversify their intake. Figures from the Sutton Trust and others confirm that partners remain predominantly male, privately educated and Oxbridge. The debate though seems to centre on the CSR imperative of corrective action: Few people have mentioned that clients of these firms are crying out for a dwindling set of skills in areas such as commercial nous, business understanding and acumen, and relationship building. No one doubts or questions the outstanding legal and technical credentials of partners from our leading firms, but broadening the DNA pool might turn out to have competitive advantage in areas increasingly depleted.
Claims, Hogwarts and an interesting insurance story
16th April, 2010“Harry was used to spiders, because the cupboard under the stairs was full of them, and that was where he slept.”
The Dursleys, afraid of Harry Potter’s magical powers, forced him to sleep under the stairs. When at ‘11 years of age’, he broke free to attend Hogwarts he was amazed to discover his fame…and potential.
Like Harry Potter (but a bit older than 11 for the most part), commercial claims teams have, to a large extent, been kept hidden (sometimes literally), with insurers being fearful of showing too much of the ‘negative’ side of insurance.
Now, however, commercial claims is emerging from the shadows and, if the opportunity is seized, has the potential to change how insurers are viewed forever. Hiscox has already used claims service to create a compelling and differentiated positioning around its high net worth segment product (“as good as our word”).
Why have most commercial lines insurers kept claims under wraps?…
What state is your key client programme in?
16th April, 2010It seems like a good time to ask. Most of our clients are beginning to emerge from recessionary trauma: intact but trimmer. During the tough times, we have all been glad of any work to come our way. But now there is a growing sense that rebuilding requires focus and that the focus should be on our most important clients.
The problem is that very few firms had well run key client programmes before the recession – even fewer now. Back then, the obstacles were largely the result of success. We were all too busy and making good money without the additional burden.
Times have changed. We need a programme that works, and window dressing to tick the “key client” box will not suffice.
There are many reasons why key client programmes fail to deliver. In a moment, I’ll reflect on our view of the key ingredients for successful programmes. First though, an observation- something strange has happened!
Most key client programmes fail because they become, or even start as, a burdensome process which fails to bring the client’s voice into the organisation. In the end, if your key client programme doesn’t make your clients feel more valued, it’s not working. Numerous clients tell us just that. They are indifferent to or oblivious of their advisers’ key client programmes.
Here’s the weird thing. Many of those self same firms also conduct some sort of client research – not always good quality and too often compromised because it’s not independent – but nevertheless they do it. Somehow the feedback doesn’t link up with the key client process. They are treated as seemingly different things.
So let’s tear up the old way and put in place some new wineskins here. The figure shows what we have in mind.
Develop an approach where the key client programme drives proper intelligence gathering. Part of that (though by no means all) should be independent feedback from the client. That feedback should be giving the key client team clarity over:
| ● The client’s top of mind issues and concerns
● How the client makes decisions (now, after reorganisations etc) ● How your firm and the relationship handlers stack up at the moment ● What is your share of wallet? ● Where do you have permission to sell – what are the best opportunities? |
These questions will not be honestly answered if it’s someone within your firm asking them.
And getting the feedback itself is not sufficient. Your firm needs a means of engaging the client team and doing things differently and better than your competitors.
And so our view of the critical success factors:
|
It’s a short list – and to deliver to it is a longer list of activities.
But looking at that list, let’s ask again the question we started with: What state is your key client programme in?
To find out more information on Gracechurch’s services, visit our website: http://www.grch.net/client_services.htmlMarketing Maketh the Firm
12th April, 2010The vast majority of law firms have a resource at their fingertips which has the potential to transform their business and help provide sustainable long-term profitability, growth, dynamism and competitive edge. This resource is the Marketing/Business Development function. But the legal sector is singularly guilty of choosing not to use it properly. As a result, law firms suffer from a lack of drive, commercial principles, long-term goals – and most importantly – the brightest and best business people, because these individuals see a better future in more attractive sectors.
Treating marketing as a “back office” operation leads to exactly that – a glorified events and brochure operation staffed by people who carry out the partners’ bidding. The whole thing might as well be outsourced to a local printing and design company for all the value it adds. So, we might have reasonably expected the legal tectonic plates to shift when the recession shook – with tumbling profits acting as a catalyst for change, “necessity being a mother of invention” and all that. However, instead of finally taking marketing seriously to combat the downturn, the painful reality is that Boards have put it, rather than dead-wood partners, first in the line of cost-cutting fire, and adopted an air of resignation to the economic slump, believing they are helpless. What a missed opportunity. Several firms went to the brink and many suffered deeply – but few, if any, saw the meltdown as a sign to fundamentally change the way they market themselves. The prospect of firms’ having private/commercial owners in the wake of the Legal Services Act has, so far, similarly failed to overcome the inertia. Stagnation lies in wait.
Surprisingly, there are ways to turn the marketing function into the central driver of a legal business – and we’re not talking about extra expense. Rather, root-and-branch changes in thinking and structure are the starting points. Firstly, marketing should not be regarded as a ‘support’ department, but incorporated into the hub of the business to advise on the overall strategy downwards. So put your marketing director on the Board, not just the Management/Executive Committee. The articles in the following link analyse the remaining steps: http://www.grch.net/files/legal_sector_special.pdf.
AIG to Chartis; can a leopard change its spots?
07th April, 2010An extract below from one of the topical questions on our Claims Performance Monitor.
Regarding how AIG UK’s name change (to Chartis) is going down with London brokers.
There may be some learning here for those who are trying to rebuild trust with business partners. Maybe a re-brand of RBS will do the trick? I doubt it somehow.
The point about losing global status is obviously important, however one could argue that was a lost cause when AIG was bailed out.
Also, those who say that the old AIG culture will prevail may well have a point – we’ll check back in a few months…
