Digital transformation may have accelerated the pace of tech adoption across countless industries, but for the legal trade, change has come at a slower pace.
Research shows that 80% of annual revenue for commercial firms is attributed to existing relationships. Yet when it comes to the management of these relationships, lawyers are still largely using traditional methods; handshakes, referrals, and unorganised communication that often happens in silos.
In the business world, it’s a well-known fact there’s great value in keeping the right customers. It’s easier and more cost-effective to retain customers than to acquire new ones. Loyal, return customers are also more likely to spend more and generate referrals. Research shows that only a 5% increase in customer retention can increase company revenue by 25 - 95% — that is significant growth. And it all rests on the ability to maintain and nurture relationships.
When lawyers rely on manual data entry, key relationships are often not being captured, understood, or managed, leaving behind and risking large amounts of revenue for firms.
Enhancing client relationships with legal tech
In the face of mounting pressure to cut costs, investing in the right tools for client relationship management can pay dividends. Our most recent Changing Lawyer Report found 54% of lawyers still spend too much time on non-legal work. By leveraging the right technology, law firms can alleviate the administrative burden on lawyers and staff by cutting down time spent on mundane tasks like the management and maintenance of a Customer Relationship Management (CRM) system. This frees them up to focus on higher-value work that will ultimately boost profitability for the firm.
Effective enterprise relationship management tools will also offer firms access to real-time, accurate insights, uncover hidden opportunities, attract more profitable work, and enhance operational efficiencies within business development, marketing, and client teams.
One of the most powerful opportunities sophisticated relationship management platforms offer firms is data and client intelligence. Through advanced software solutions, law firms can generate insights that help identify opportunities such as cross-servicing, proactive alerts in the absence of contact with key clients and referrers, and support for succession planning efforts. With the right technology, law firms can provide real-time data and easily access relationship intelligence, leading to improved collaboration, transparency, and new strategic capabilities.
The future of client relationships
In the digital era, law firms must build a strong client foundation and prioritise the management and protection of key relationships. Leveraging technology solutions like CRM and Enterprise Relationship Management (ERM) systems will not only help relieve employees of mundane data entry tasks but also streamline operations. Investing in an effective legal tech stack will help firms remain agile, adaptable, and better equipped to thrive in the evolving business landscape.
Stefan Steenveld is head of APAC sales at Litera, a global provider of legal software tools that help lawyers, partners, and business professionals focus on their craft and expand the impact of what their firm can accomplish. Litera recently partnered with Client Sense to grow their ERM offering.
Stefan Steenveld, APAC Lead, Litera