BIGNON DE KEYSER
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BIGNON DE KEYSER
is an independent consulting firm specialising in strategic, management and organisational consulting, dedicated to legal professions.
 

NEWS
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June 2014

Client portfolio analysis, a necessary prerequisite to any business development programme

In a difficult environment characterized by significant changes and strong competition in the legal market, it is more crucial than ever for law firms to develop a structured, proactive business development strategy. In light of their clients’ increased expectations, business law firms have to succeed in acquiring new clients without neglecting the development of their existing portfolio.

Various means are available to law firms that wish to better target, organize and structure their business development activities. These include analyzing the strengths and weaknesses of a firm’s client portfolio, which appears to be a prerequisite to any business development activity

What are the benefits of a client portfolio analysis for a law firm?

By conducting a methodical, thorough analysis of its client portfolio, a law firm will have a better understanding of its current client development policy, of its failures and successes in that area, and of the strengths and weaknesses of its portfolio.
A law firm can learn lessons from this process, which it can use later on when reflecting on the subject of client development.
This exercise will also help the firm to assess whether its client portfolio is properly aligned with its target positioning, and identify the clients and business providers it should focus on.
Through this analysis, the firm will be able to pinpoint the practice areas and sectors in which it is most active and has the biggest comparative advantage, and the type of target clients it should make efforts to acquire.
The client portfolio analysis will also enable the firm to evaluate each client’s potential for cross-selling and will help it to identify the clients which are shared the most and the least among partners.

Finally, this exercise is an efficient way of gauging its clients’ loyalty and the recurrent business they generate, as well as of identify whether the firm may be dependent upon certain clients.

What are the lessons that partners can hope to learn from their firm’s client portfolio analysis?

Firstly, as they will have a comprehensive overview of their firm’s clientele, partners will be able to identify the corrective actions needed in order to better align their own client portfolio with their firm’s goals and strategy.Partners will also gain increased knowledge of the clients of the firm’s other partners and of the services rendered to them. They will be able to think about what they could do in order to share business and introduce their own clients to their partners where feasible.
In addition, analyzing their client portfolios allows partners to use existing client data (nature of clients, type of cases or matters handled, experience …) to optimize their development activities.
Finally, a client portfolio analysis will help partners assess the role played in the acquisition of new clients by some of their business providers and by the networks and associations of which they are members.

How to conduct a client portfolio analysis

In order to get a clear, useful picture of its client base, the firm can, for example, look at the following:

  • The breakdown of the client portfolio based on:
    • Amount of fees;
    • Type of company (very small companies, SMEs, intermediate-size companies, large multinationals, …);
    • Origin of the clients (business providers, networks, professional associations and clubs, other clients, etc.);
    • Nationality / geographic origin of the clients;
    • Business sector / industry;
    • Which practice group within the firm works for the client;
  • What proportion of the firm’s revenues the top clients represent;
  • A ranking of the firm’s clients based on their potential (weak, intermediate, or strong);
  • The identification of “high-risk” clients;
  • The number of clients won and lost by the firm in the past year.

Patrick Bignon
june 2014



ARTICLES:





NEWS IN BRIEF
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