As global marketing and business development executives get ready for this year's Law Firm Marketing Summit on 6 November, one of the key topics on the agend is the world of business intelligence and its importance to law firms in an ever more competitive environment. Harry Pfeffer talks to the Global Legal Post about the challenges and opportunities for law firms including why GDPR has changed privacy rules across the world including its influence on the new Californian privacy laws. 

Global Legal Post: How does CRM/Business Development/Marketing in the legal marketplace compare to other sectors?

Harry Pfeffer: The state of CRM/Business Development/Marketing is evolving in the legal sector and, potentially, still playing catch up with other sectors.  Typically, law firms have approached these areas tactically.  Not in all firms, but there are still many instances where individuals from other business areas in a law firm have stumbled into CRM/Business Development/Marketing by helping with activities such as newsletters and events and eventually taking on important, permanent roles in these functions – to then find that they lack the professional skills, expertise and education/credentials to do justice to these critical positions. I’ve even come a across situation where a partner’s family member was brought in to organise events for the firm because they were known to be good at throwing parties – to eventually became the Head of Business Development.

 A shift, however, is taking place in the sector’s approach and attitude to CRM, Business Development and Marketing. Previously, it was not unusual for partners who were close to retirement age, to be designated as the equivalent of the firms’ CEO or even CFO. But about 15 years ago, this began to change and today, of course, law firms actively hire skilled professionals from other commercial sectors to run and manage business operations like finance, security and I.T.  The same is now beginning to happen in CRM, Business Development and Marketing in law firms as well. 

Commercial organisations are often far more aggressive and innovative in their marketing and business development.  So today when law firms hire a Head of Marketing, Business Development or CRM from the commercial sector, they find that the individual injects an energy and approach into these functions that is almost transformational for the organisation. I’m reminded of an Italian law firm who hired a Head of Marketing from one of the big accounting firms – this executive literally turned the department on its head and to great benefit to the business.

GLP: Is there a scenario that you can provide to illustrate the value of CRM for lawyers? 

HP: CRM is all about empowering lawyers with credible relationship intelligence, in context, and at exactly the time and place they need it. Take the example of out of office or remote access to relationship intelligence. While spotting a vaguely familiar name on a speaker list at an event, the capability to then access the firm’s CRM data to learn, on-the-spot, what that person might mean to the firm, who at the firm knows that individual, and who else at that firm might we know, can be very valuable for business development. 

GLP: So then why has CRM sometimes struggled in law firms? 

HP: Failure of CRM can almost always be attributed, firstly, to the lack of a coherent strategy embraced across the firm; and secondly, to the lack of user adoption of the CRM solution. One of the biggest challenges of CRM adoption in law firms is that sometimes the strategy (and the tools to carry that strategy) are not properly and effectively embedded in the lawyers’ day to day activities of practicing law.  This can result in lawyers’ perception that participating with a CRM solution appears to be burdensome and too time consuming.  We have worked extensively with law firms to help incrementally help address this situation in a meaningful way. 

GLP:  So, then are you and other CRM technology providers doing anything to help overcome user adoption related challenges in law firms? 

HP: For our part, we are currently addressing these issues materially, and in fact, already responding to these challenges. For starters, we have just launched ‘InterAction for Office 365’ – it’s an application that consistently embeds CRM data into lawyer’s and other users’ workflow across the Microsoft Office stack (Outlook, Word and Excel) and consistently across both desktop and mobile platforms. This means that lawyers can intuitively access critical CRM data, and wider content, from just about anywhere they happen to be working and exactly at the point where they need it. Another example is the delivery of the pathways into the deeper, data rich interior of the CRM/BD solution via entirely customisable (user by user) dashboards so that the information they want access to and how they see it fits perfectly with how they work. This will truly change the conversation about CRM adoption. It is an exciting development for the CRM industry and law firms that use such systems.   

Also, while law firms are gradually accepting the benefits of cloud technology, there is still nervousness on the part of many in terms of where the sensitive personal data of all their contacts (and clients!) reside.  LexisNexis is now delivering InterAction via a hybrid cloud model – it’s a LexisNexis patented technology.  This model enables us to deliver all the obvious benefits of a cloud-based application, while securely accessing the data (without storing it at rest) regardless of where it resides – be it on-premises safely behind the firms’ firewall or in a private cloud. This hybrid model combines the best and most valuable aspects of SaaS with the control, security and choice that law firms want. 

GLP:  Is there any difference globally in the application of CRM systems?

HP: With a rough brush, we can divide the world broadly into East and West. The East is more conservative, reserved and protectionist – in fact, in some countries in Asia, even sharing data between departments is not permitted. By contrast, the West is generally more aggressive, direct and engaged with CRM.

CRM systems have a tangible role to play in data protection and privacy. With many of the larger law firms having offices across geographies, law firms must apply their CRM systems differently, even though the fundamental basis of privacy and data protection is the same, regardless of country or region. For example, storing critical personal information of a firm’s contacts in the cloud meets with all sorts of resistance depending where in the world you are in. So, the CRM technology adopted must meet the specific data storage requirements of the various regions. 

And, without a doubt, we have a special situation in the European Union with the GDPR. It rocked the world of businesses, and law firms too have had to adapt to this regulation, country by country. This said, it’s no longer a European requirement only. From all reports, the GDPR is potentially the global template for data protection and privacy. Already, there’s the California Consumer Privacy Act (CCPA) that is modelled on the GDPR and comes into effect in 2020. And there are many, many others.  So, this is another area where LexisNexis has made a huge investment in InterAction’s functionality to intuitively enable law firms across the globe to remain compliant.  It’s genuinely not an exaggeration to say that – given the nature of personal data that resides in law firms – how on earth can these organisations remain compliant in this new world without investing in a state-of-the-art CRM solution!