Emerging legal issues, new legislation, new regulations and new technologies often present sexy new opportunities to form a new practice area. But the time, cost and use of marketing resources to launch a new practice area can be substantial. It can also distract the firm's focus from other, more promising opportunities. As a result, many new practice area initiatives sputter along in name only on the website, never reaching their full potential.
Why is that?
One reason is that the decision on whether to build a new practice capability is rarely subject to a rigorous due diligence process. Questions with regard to how much opportunity there is, the level of investment required, the ramp up time and learning curve required and other important factors that underpin the success of the initiative rarely get asked, let alone thoroughly answered.
It's hard to douse the enthusiasm of a partner who is motivated to do business development. But constrained time and resources being what they are in most firms, it's important to choose investments in new marketing initiatives carefully. To hedge your bets, the firm will need to answer three key questions: How will attorneys monetize their knowledge of this issue? Who needs the services? And, how well positioned is the firm to provide the services?
To dig deeper into the practice area's potential and guide the analysis of the market opportunity, follow this line of questioning and gather specific evidence where possible.
1. What is the billing potential of this work?
- What are the substantive legal issues in the new practice area?
- What are the questions of law that have not yet been addressed?
- What is the degree of regulatory oversight related to this issue currently. Is that oversight intensifying or easing?
- How predictable are these issues? Are they fairly routine or are they dynamic and unpredictable?
- What other practices in the firm might benefit from or contribute to this new practice area?
2. Who is the target audience for the services?
- Which types of businesses and in which industries would the services be needed?
- Which existing clients of the firm would have need for this service /expertise?
- How strategically important are the issues to the company? What degree of risk do the issues present companies? What opportunities for growth do the issues present companies?
3. How well positioned is the firm to provide the services?
- Which other law firms or attorneys provides the advice or service currently?
- What areas of the law firm's current practice offering could lend credence to this new practice?
- Which lawyers in the firm currently have the experience and knowledge in this area? What substantive legal knowledge needs to be developed or researched?
- Which attorneys will dedicate the time to market the new practice area? What is their level of commitment to this project and their ability to dedicate other demands on their time?
- How would this practice be marketed and what costs would be associated with marketing this new practice?
While it's tempting to dive into a new practice group to gain an early entry advantage, the haste can make for a waste of valuable resources in the firm. Taking the time to clarify the opportunity will help to articulate the business opportunity clearly and lay the groundwork for a more strategic approach to the market.
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