Those tough tender moments

By Kim Tasso

Increasingly, clients are taking the lead and asking their lawyers to jump through hoops or line up in a beauty parade in order to win a place on the panel or to continue to provide legal services to their organisation. Recent reports in the legal press indicate that there were nearly 50 major tenders from leading banks, insurers, energy, construction and media companies during 2013 alone.

But in addition to these headline-grabbing exercises where some of the mighty have fallen, on a day-to-day basis there are a myriad of other, smaller client organisations putting the microscope on their legal advisers and asking them to submit tenders and proposals or to pitch for the business.

Whilst some may tackle this is as a rational documentation and presentation production exercise, those in the know understand that tendering is not for the faint hearted. Even the most sophisticated clients recognise that irrational and emotional aspects – such as how the personal chemistry works and whether their legal advisers “get” their culture – play a big part in the decision process.

And increasingly, the clients are focusing not just on the excellence of the legal skills (they probably wouldn’t ask you to tender if they weren’t fairly confident that your firm made the grade in this respect) but on the relationship, how you manage and measure the delivery of legal services, how you can bring savings in absolute cost or efficiency and what “added value” you can bring to their party.

Larger law firms have vast teams of marketing and business development people who provide a raft of skills such as buyer and social psychology, sales process management, selling frameworks, client listening, decision analysis, procurement knowledge,  relationship mapping,  differentiation and proposition development, value pricing and project management to name a few. Some firms have dedicated teams of research, technology and know-how professionals to develop innovative service offerings that give them both a competitive edge and lock-in for critical relationships.

These business development professionals – if they’re good – will help their lawyers develop persuasive sales strategies and rehearse them in interpersonal skills such as rapport development and trust building and coach them in non-verbal communication and other behaviour. I know because I work with those professionals and their lawyers when they face a demand peak or a particularly challenging client or tendering scenario.

Successful tendering requires a lot of sales expertise (not something that many lawyers will possess) and a huge investment in time – from both lawyers and support staff. And that opportunity cost is often not built into the analysis of how much profit a successful tender is likely to yield (especially as clients will usually expect discounts or preferential rates in return for permission to provide services or volume work).

So think carefully before you leap in and accept the next juicy tender invitation that pings into your inbox. Consider whether you have the systems, resources, sales expertise, know-how and stomach to put in the hours in order to have a fair chance of winning.

For a detailed analysis of the major law firm panel tenders in the second half of 2013 and the trends and actions that law firms might take as a result, see here.

Filed Under: Practice of Law

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