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“You did WHAT!?” – The Powerful Value of Providing Something for Nothing

Posted in Business Development

At the risk of further confirming our reputation as heretics, let us advance what to most practicing lawyers may seem like an outrageous proposition: “Not everything in life has to be a billable event. There are times when you’ll help your cause most by providing value and not charging the client.”

 Full disclosure: This post was triggered by the progress reports of a group of up-and-coming partners participating in a year-long business development coaching program. All confirmed the powerful BD benefits of face-to-face time, researching all aspects of potential clients’ businesses, and relentless follow-up on preliminary contacts.  But several reported a surprising — and surprisingly successful — tactic that had resulted in business breakthroughs: when the potential relationship was still in the courting stage and before engagements commenced, they volunteered to perform some “staging” activity, fact-gathering or preliminary situation analysis, at no charge.

Why Would I Do That?

Particularly in the course of business development, when you are trying to establish relationships and build trust (or get added to a panel or even to displace another established relationship), you may increase your chances of success by crawling outside the “how-much-and-how-soon-can-I-bill?” box.  “Strategic altruism,” in which you confer some value gratis, may take diverse forms and provide diverse benefits, near-term and long term:

  • Rapport: It may convince potential clients that for once they are not going to be on the receiving end of a high pressure sales pitch (part of which comes from that dreaded chapter of the Sales 101 course entitled “how to overcome customer objections”). They may relax, smile, stifle their skepticism, and throttle back their defensiveness. They may become more open to you and more open to what you are marketing.
  • Showing the Flag: It can provide you with an opportunity to give the client a low-risk taste test of some aspect of your expertise or judgment in action (particularly important if this is an attempted new client conquest or you are trotting out a new or specialized legal service, such as Inter Partes Review, Dark Pool financial litigation, patent portfolio monetization, cybersecurity protection, or some other new and esoteric practice area.
  • Scoping Support: In service of faster, more focused, and more accurate scoping of potential engagements, performing some preliminary evaluation without charge can help you do better situation analysis and propose more realistic project scope, phases, tasks and budgets. It may also tell you if you’ve stumbled into a mine field.
  • Learning About the Client: You may elicit some invaluable information (after executing an NDA, of course) that will give you a feel for both the “hard” dimensions of this client’s needs and priorities and for the “soft” dimensions of how this  client operates in relationships, defines value, and likes to communicate.
  • Setting the Stage and Differentiating Yourself From Competitors: By performing some baseline project-mapping, you can configure an approach to service delivery that is tailored powerfully and specifically to your or your firm’s capabilities. By “giving something away free,” you can demonstrate that you are a uniquely helpful and client-focused lawyer, as well as showing the potential client what it will be like to work together.  True differentiators are rare in the legal profession.  Being a “giver” can really set you apart. That is, you can put yourself in the BD driver’s seat and shove your competitors to the back of the bus.
  • Provoking a Little Guilt: By proactively conferring a “gift” of value on a potential client, you may foster a subliminal sense that “fairness” requires them to reciprocate in some way, if only to give you a more receptive ear or the chance to strut your stuff with some serious assignments. One wag has called this the “Genius of Generosity.”

How Long Since You’ve Sent an “NC” Bill?

Even after business development has morphed into an ongoing client relationship, sometimes it’s good strategy to demonstrate to the client that your overarching goal is not to profit-maximize at all times. Suppose a matter has been “overtaken by events” (especially events not of your making) and is experiencing some scope creep that’s triggering some unanticipated billed time.  Should you invariably hew to the letter of the engagement letter and bill to the last drop?

Some months ago, we walked with a General Counsel past a staff bulletin board in the legal department’s hallway. There, fastened with a giant push pin, was a law firm invoice – a pretty hefty invoice. Among the various line items was the item: “Additional research suggested by passage of new XYZ legislation.” On the charge line was the entry “NC,” circled in bright red magic marker.  “Do you see that?” the General Counsel exclaimed. “No one has ever sent me a ‘no charge’ bill before!  That’s being an attentive steward of our money, and I was impressed.”

The moral is clear: if circumstances conspire to force you to expend more time and resources on your firm’s own dime, don’t eat the cost in silence.  Let the client know the nature and magnitude of the work you’ve opted not to bill.  You don’t have to be virtuous in a vacuum.  And you will trigger happy surprise.

Now Don’t Get All Crazy

Let’s be clear: we are not suggesting that you turn your firm wholesale into a pro bono operation.  You should expect to be paid fair value for your work, and even cost-constrained clients should be expected to pay for it. If you make the decision to do a little loss-leading, of course you are not going to unilaterally write no-charge on significant amounts of substantive legal work product.

Your generosity-leverage events are best confined to ancillary or preparatory activities, in other words, they are “baby steps” that help build a platform for the later and greater value you can confer. That platform can be the foundation – the legal predicate — on which a significant engagement is built. It can also demonstrate what the working relationship with you and your firm will be like.  Either way, it can be a seed that grows big trees.

 

© 2014, Pam Woldow, Doug Richardson & Legal Leadership, LLC. All rights reserved. No part of this article may be copied or reproduced without prior written approval.