Nigeria: Legal Services Procurement – What Do Clients Really Want?

Last Updated: 13 March 2019
Article by Asue Ighodalo and Oluwatoba Oguntuase

LEGAL PRACTICE OR CLIENTS' APPETITE – WHAT HAS CHANGED?

Generally, legal practice (what lawyers do) hasn't changed much but what has undergone, and is continually undergoing significant changes, is legal delivery (who bundles the work and from what model). Mark Cohen, chief executive officer, Legal Mosaic, agrees in his recent article, "Perspective: Are Law Firms Just Like Other Vendors?" published in Bloomberg Big Law Business.

The constant changes in legal delivery by lawyers and law firms, however, are being driven by a number of factors from the clients' end, such as;

  • cost reduction strategy (this became the norm globally following the 2008 global financial crisis when corporate clients began to make substantially lower budgets, than before, for legal services and attempting to do more by in-house legal departments);
  • regulatory changes; and,
  • modern technologies.

In the wake of these developments, what clients really want have generally changed from the traditional supply of legal expertise to assurance of the lawyer/law firm's ability to provide quick, often real-time, solutions and satisfactory responses to a diversified range of existing and imminent problems and needs.

KEEPING THE CLIENT–ATTORNEY RELATIONSHIP IN THE KNOWLEDGE AGE

The bid by lawyers/law firms to knowing better what their clients want and by so doing retaining their patronage, has contributed to increasing competition in the legal services market.

Besides having a deep knowledge of the law, clients are constantly looking for lawyers/law firms who can demonstrate reasonable level of knowledge in, and understanding of, their businesses; the operating economic environment; relevant government policies; the larger industry and often would want a buy-in into their trajectory and projection of growth, profitability and sustainability.

Lawyers/law firms are therefore now expected to provide legal consulting with a wide range of ancillary services as added values. By this, clients want to receive more services from their attorneys but pay less while attorneys want to retain their relationships with the clients by considering both quantity and quality still at a profit. As a response to this, according to Mark Cohen in its aforementioned article, both the clients and the law firms are seeking equilibrium in the shifting legal marketplace and this is reshaping what clients want today.

CLIENTS ARE MOVING FROM THE TRADITIONAL PROCUREMENT PROCESS

Because of increasing complexity of the operating and regulatory environments, and a growing concern among clients about how to reduce spending and do more with less, there has been a great disruption to the traditional procurement process in which clients stick automatically to lawyers/law firms basically out of long time relationship. The resultant declining confidence, growing disconnect between law firms and their clients as well as the imperative of reducing costs have led to the increasing use of Request-for-Proposals ("RFPs") by in-house legal departments or corporate counsel.

In a publication by Legal Futures, "Commercial lawyers are failing to understand their clients," reference was made to a 2011 survey conducted by the Financial Times and the Managing Partners Forum (MPF). In the said survey, clients and legal advisers were quizzed about a host of issues regarding their business relations. The outcome produced significant discrepancies between what clients want from a law firm and what a law firm believes its clients want.

When asked for the three most important attributes when judging the health of a law firm-client relationship, according to the survey, the ability to solve problems quickly was by far the most popular from clients (54% of respondents). In contrast, it was the fifth most selected option by external lawyers, with just 34% making the selection. The table below reflects the complete survey:

Important attributes for a healthy law firm-client relationship

Client Law firm
1 The ability to solve problems quickly Knowledge of client's business needs
2 Knowledge of client's business needs Frequent communication
3 Trust Consistency in meeting client expectations
4 Frequent communication Trust
5 Transparency and openness The ability to solve problems quickly

DIFFERENT CATEGORIES OF CLIENTS, DIFFERENT LEVELS OF WANTS

Whilst it is true that all clients now want added value (something more than the traditional supply of legal expertise), they still defer significantly in terms of their demands, taste, and concerns. What clients want defer specifically with;

  • Micro, Small, and Medium Enterprises ("MSMEs");
  • Big Companies,
  • Multinational Companies.

Generally, costs may not be an issue for Multinationals and Big Companies as it would for MSMEs; who are likely to have serious consideration for competitive pricing.

Between MSMEs and Big Companies, reputation; costs; knowledge of the clients' business; industry awareness; reasonable accessibility; and timely delivery and effective communication are crucial issues in procuring legal services.

For multinational companies, thorough local knowledge; experience and expertise in the operating, legal and regulatory environments; reputation; and cutting-edge technologies that would aid rapid and effective communication and data analysis would generally matter in procuring legal services than costs. Secure computer and internet systems that would guarantee safety of confidential clients information is also a very important consideration for multinationals in the wake of increasing incidences of global cybersecurity risks and the bitter lessons from the Panama Papers in 2016.

CONCLUSION

The modern day legal services market place demands multiskilling on the part of lawyers/law firms and the speed with which clients' briefs can be handled effectively, professionally, securely and yet profitably, determines the extent of the clients' satisfaction.

As new technologies evolve and tend to disrupt the traditional ways of working and doing business, it is imperative for law firms to invest in modern computer applications, internet services, and information & telecommunications facilities which are essential for building borderless, smart workplaces; where communication between clients and attorneys are unhindered by time and space.

In the overall, lawyers/law firms who combine a reasonable mix of all the considerations and expectations of modern day buyers of legal services, will be able to think ahead of clients' expectations, meet their demands in qualitative and cost-effective ways, and be able to stay ahead of competition by gaining client's confidence.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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