I received a couple of interesting comments in response to my earlier post, A Call For Benchmarks, and it seemed prudent to share them in the most public way.
Comment 1 was from Steven Levy, renowned expert on Legal Project Management, with whom I will be presenting in March:
Many of these are substitute metrics, which are bad juju. For example, win/loss record: Think of the DA who tries only slam-dunk cases and pleads out anything difficult; is that better than someone who takes on the toughest cases and wins 75% of them? (Are the 9-4 USC Trojans better than the 5-11 Seattle Seahawks? Different leagues.)
Partner/associate time may be distorted based on the type of work partners take on. I’ve seen situations where partners are doing associate-level stuff; is that good or bad? What if they’re 3x efficient at 2x cost? Or 2x efficient at 3x cost?
And so on…. I’m not suggesting that metrics are bad, just that it’s a bad idea to take them in a vacuum and make a decision solely by comparing these numbers.
That said, I’d add one: What percentage of the time do you refund (or not charge) part of an anticipated or agreed fee because you solved it well ahead of schedule? If firms don’t do this at least once in a while, are they really acting in your best interests? On the other hand, if they do it too often, they’re probably padding their estimates.
Not everything that counts can be counted, said Einstein, and not everything that can be counted counts.
Response and Comment:
No metric I know of provides "universal knowledge and enlightenment" to prospective clients. But clients frequently ask about wins and losses because they would rather hire lawyers who win trials than those who lose them. If you don’t have a record, most clients will reasonably infer that is so because you are reluctant to try cases. You may be able to explain the problem away, but the information is useful. The Trojan-Seahawks comparison is always an issue, and some judgments cannot be made on win-loss record alone. But that doesn’t eliminate its value.
Partner/associate ratios can mean many things. It may mean that the firm is using an experience-based model. Or that it is highly leveraged. Again, the statistic is a starting point for discussion, but not knowing the answer suggests a lack of sensitivity to the leverage issue, which is important to clients.
On the benchmark you raise, we give every client the right to adjust our fee. That said, the reason you offer–"because you finish ahead of schedule"–is not a reason to adjust a fee in my view. With us, the client is not buying time, but a result. It should be indifferent to how long it takes to produce the result.
Comment 2 is from Bradley Clark:
I believe the benchmarks differ across the client spectrum. Where an institutional client employing BigLaw on a matter may look at some of the benchmarks you have identified I know twice as many – if not more – that buy professional services based on relationship, trust, knowledge, and integration.
Response:
The factors you identify, Bradley, are factors that playing varying roles in every retention decision. That doesn’t mean clients, including small clients, don’t benefit from seeing your performance data on whatever benchmark is important.