Cross-selling in law firms is always a hot topic of discussion. There is a lot of talk, with little action. Further, there is even less success. Why does cross-selling seem like an unsolvable riddle for so many law firms?
Obstacles to Cross-Selling
The biggest problem is that many law firms do not have compensation systems that fairly reward or incentivize successful cross-selling. Attorneys with the client relationship do not want to share any credit. On the other hand, lawyers with the needed expertise do not want to do the work if they are not compensated. Firms that are successful have figured out this dilemma.
The next problem is the lack of trust. It is a shame that colleagues cannot trust one another. We hear so many stories about lawyers being scared that “their clients will be stolen.” This is nonsense. A relationship can only be stolen if the relationship attorney allows it to happen. It will happen when the relationship is not nurtured and valued by the relationship attorney. However, there are times when a lack of trust is legitimate. For example, it is fair to not trust your colleague if he has a history of not being responsive. Also, it is fair to not trust your colleague if she has a sour personality. This said, to effectively cross-sell, there must be trust.
Lastly, we see the failure of cross-selling in law firms due to the lack of know-how. This happens is two ways. First, the lawyers are not educated as to the firm’s full capabilities. Anybody who has ever worked in a law firm has seen the “does anyone know somebody who does real estate law?” or a similar email. Second, many lawyers simply do not understand the art of sales. By definition, how can one effectively cross-sell if he does not know the basics of sales?
So, should we give up because of these obstacles? No, we figure a way around them.
How to Solve the Cross-Selling Riddle?
The first step is to have a fair and honest compensation system. Of course, that is easy for us to say. But if your firm is serious about reaping the benefits, it will overcome this hurdle. A conservative estimate is that your firm’s revenue can be increased by 10-20% by effectively cross-selling additional legal services to existing firm clients. How about this for a change of mindset – calling clients firm clients. Share credit based upon contributions. We believe in carrots more than sticks, so create incentive systems. Challenge those who are not being honest about their contributions.
The second step is to address trust issues. The relationship attorney must be the one who calls the shots. He or she must decide the cross-selling team. Management cannot, nor should it, force the relationship attorney to include other lawyers who will not click with the client. That said, the relationship attorney must be challenged if he says there are no opportunities. He must explain what he has done to ascertain that the client is not a viable cross-selling target. Without a valid explanation, he may be worried about his client being stolen. Again, we call BS on this.
For the last obstacle, we recommend that law firms implement a program to education the salesforce. In other words, all the firm’s attorneys need to know all the firm’s capabilities. Therefore, have your people or practice groups give internal presentations that include capabilities, the profile of the ideal client, and questions to ask clients to ascertain needs. And, get your lawyers trained in basic sales concepts.
Make the Commitment
Cross-selling in law firms is indeed a tough riddle to solve. However, it is worth solving. At the end of the day, there will be more revenue, you can institutionalize the client as hedge to a relationship attorney leaving, and create stable succession planning for your firm.