Originally published in Marketing the Law Firm Newsletter in May 2017.
A BigLaw Director of Business Development recently lamented to me, “we want to do more with our data and CI function, but I’m just not sure the firm is ready.” Despite her firm’s best efforts to give the lawyers access to information, little was changing. Actions continued to stall, decisions weren’t being made and, most importantly, the firm wasn’t generating better outcomes as a result of the insights and analytics.
Sadly, this is a familiar refrain. In many firms, the primary challenge lies in having information, not intelligence — insights on which one can act. In this instance, however, the situation was more nuanced. Despite the sophisticated analytical skills of the team, my friend’s firm was unable to incorporate the learnings into its daily activities. An early 2000s title, The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action, addresses this very phenomenon. In it, Stanford professors Jeffrey Pfeffer and Robert Sutton explore a variety of factors that incite a type of paralysis in firms, an inability to progress despite knowing what to do.
Fear, internal competition and endless deliberation are among the issues Pfeffer and Sutton tackle. Perhaps not surprisingly, these are some of the same obstacles preventing today’s law firms from taking optimal advantage of the knowledge available to them. Over the course of working with law firms, four challenges, in particular, have presented themselves most frequently.
1. Cultural Norms
Perfectionism is one of the most common, and certainly most recognizable, driving cultural norms in today’s law firms. Overachievers are striving to deliver excellence in every facet of their work … sounds great, right? Well, the downside to Perfectionist cultures — and leaders — is the behaviors it unintentionally encourages. Cultures that embody perfection, and those that are intensely competitive, leave little to no room for error. For a law firm seeking to change, this is a non-starter. Intolerance for error breeds fear of failure. It leads to a reluctance to embrace new ways of doing things and, over time, a reliance on being told what to do and how to do it. All of these mindsets hinder action.
No matter how good the data and analytics are, pursuit of a demonstrated opportunity may be mired in an abyss of risk-aversion. Imperfect data, anecdotal evidence and intuitive suppositions — all common in strategic analysis — lack the certainty and fool-proof status demanded by perfection-bound or competitive environments.
Solve This Challenge:
- Adopt protocols to encourage a more constructive culture.
- Celebrate learning moments from failed attempts.
- Set clear expectations at the outset about the chances of success and make wise decisions about what is at stake (i.e., play out the “worst-case scenario”).
2. Low ‘CI-Q’ at the Senior Levels of the Firm
“CI-Q” (a term coined in tandem with authoring this article) refers to the ability to interpret, effectively present and apply analytical information to strategic business decisions. Pfeffer and Sutton suggest that the gap between knowledge and action is smaller when those tasked with taking action have the knowledge and experience to do so (i.e., they’ve “been there, done that”). While many lawyers have well-honed analytical capabilities, these capabilities are most frequently used to interpret law — e.g., how a particular fact fits into the context of a precedent, statute or contract term — rather than to drive a business forward.
This gap is particularly tricky. Many lawyers fancy themselves experts in analysis; few are. Furthermore, lawyers (especially litigators) are trained to find fault and question assumptions. This default approach to situations can unintentionally place the firm’s business executives and analysts in the line of fire. The emphasis becomes how to shoot down the data rather than how to utilize it to inform and guide a plan of action.
Solve This Challenge:
- Build analytics into daily practices.
- Train and coach lawyers and professionals at the firm in where and how to apply intelligence.
- Hire or outsource information design — the transformation of information into effective messages.
- Establish ground rules for leadership meetings on how to approach analyses and data presented.
3. The Web of Internal Data
Intelligence in law firms derives just as much from internal sources as external. Unfortunately, the state of many of these internal systems is, well, unfortunate. Few firms have fully integrated internal systems, demanding end-users such as pricing analysts, business developers and recruiters, compile information from multiple places just to devise a baseline understanding of a client or opportunity. Relatedly, law firms routinely grapple with GIGO — garbage in, garbage out — where the data they can access is unreliable.
This poorly integrated internal data makes it nearly impossible to effectively and accurately measure progress. For example, how can one assess whether the firm has increased penetration in the Tech sector if it is unable to accurately categorize and analyze client data by industry? Clearly defined metrics are one of the keys to closing the knowing-doing gap. Without these, the inability (or reluctance) to act on information will persist and, at least in some instances, the firm will be none the wiser.
Solve This Challenge:
- Combat GIGO through near-constant training and education on the frontlines.
- Empower people as data stewards and give them the tools and authority to enforce good data practices.
- Invest in an integrated technology platform (hint: it will pay for itself in months).
4. Siloed CI Teams
Whether housed in the library or tucked under Marketing and BD, it is the rare Business Intelligence analyst who is blessed with regular, meaningful interaction with partners and firm management, or a clear window into the big picture and broader objectives of the research with which they are tasked. Though many capture snippets or make efforts to deepen their knowledge of the business or BD activities, the sheer volume of work may prevent these valuable communications. In other scenarios, the information is simply not made available at all.
What law firms are left with, then, is too much focus on the how (to deliver) and not enough on the why (are we doing this). This perennial disconnect results in perpetuating the gap between knowledge and action. Information is served up, but there is no dialogue or catalyst for action. Instead, findings are digested and discussed rather than treated as a platform on which to build competitive advantage or capture gains.
Solve This Challenge:
- Integrate a senior-level intelligence professional into strategic decision-making across the firm.
- Eliminate structures that promote middlemen (e.g., Project Managers or Business Developers serving as go-betweens).
- Educate and train professionals in “CI-Q,” or the ability to interpret, apply and present analytical information.
Though law firms have come a long way in their reliance on and utilization of data, there is still an expansive opportunity to better leverage this newfound knowledge into action. Bridging the gap between intelligence and strategy or profit indices and business development investments, etc. is still, for many, more a dream than a reality. Closing this knowing-doing gap will propel a select few ahead of the others. After all, knowledge is power … if you know what to do with it.