using kpi to ensure the marketing department’s stor is...

Using KPI to Ensure the Marketing Department’s Stor is Heard at the

ASI December 1, 2011

Story is Heard at the Management Table

ASIApplied Strategies, Inc.

Michael Mabey

Stephen Mabey

26 Wilewood Drive Falmouth, NS B0P 1L0 Phone: 902.472.3032

Common Sense AppliedLegal Marketing Association

Common Sense AppliedThanks

We just wanted to thank the audience for showing up today as we recognize that in these

hectic times everyone has lots on their plates and so to be with us today was a choice

and we hope you think a good one!

We are going to answer in the remaining time, any questions you might have but welcome

you to contact either of us at the following e-mail addresses you to co tact e t e o us at t e o o g e a add esses

with any follow up questions:

M b @ i [email protected]

[email protected]

Applied Strategies, Inc. 2

Common Sense Applied

What’s In It For Me?

That is the question your firm’s management team is asking before inviting you to the table.g y

This presentation is about: using KPI as a tool to gain influence in your organizationg g y g who you enlist in identifying the KPI you will use to gain

influence how you go about getting listened to how you go about getting listened to

It isn’t about the specific value of a particular KPI, although we will talk about some KPI In other words, it is strategic in nature, with tactics for

accomplishing your goal – Influence at the Management Table


Common Sense AppliedSCENEAgenda

1

2

Performance Indicators, Defined

Building a Seat at the Table – 4 Components

3 Insight Leads To Influence

4 Communication Drives Influence

5 Dashboards Enhance Clarity


Common Sense AppliedRefresher on Performance Indicators

Firms track various performance indicators as measurements of their health and performance.

The importance of various performance indicators can and will change over time.

Performance indicators have historically focused on the

These performance indicators assist not substitute for common d j d t i t i fi th h h

Performance indicators have historically focused on the financial and operational aspects of law firms.

sense and judgment in steering your firm through change.

No one number tells the story but rather must be viewed collectively to get an accurate picture.



What Converts A Performance Indicator Into A KPI

Must be quantifiable

Must reflect your firm’s goals

Must be key to your firm’s success


Common Sense AppliedResources

For more information on KPI and lists of possible KPI to use and so we can stay on track here, (as best Michael can), we direct you to the link below to download a copy of Introductory Guide to Key Performance Indicators.

Topics include Marketing, Productivity and Financial Key Performance Indicators as well as such topics as Dashboards and Benchmarking.

http://www.appliedstrategies.ca/kpi_download.php


Common Sense AppliedSCENEBuilding a Seat at the Table

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2








Building a Seat at the Table -4 Components

1. Understand Your Firm’s

Strategic

2. Match Performance

Indicators withStrategicDirection

Indicators with Strategy

4. Communicate 3. Gather and Analyze DataAnalyze Data

Applied Strategies, Inc.

9

9


Building a Seat at the Table -1: Understand Your Firm’s Strategic Direction

Steps

Develop a 360 degree perspective of your firm’s strategic direction

Spend time with: Key influencers

Steps

Strategy architects People who are executing (partners,

practice leaders, senior staff) The firm historian the person who The firm historian – the person who

knows what “didn’t work before” so you can avoid landmines and address those concerns upfront


10

10


Building a Seat at the Table 2: Match Performance Indicators to Strategy

Steps

The best indicators will be based on the nature and style of your firm.

Cultivate a relationship with the CFO and Accounts Department

Steps

Understand what various potential KPI are really telling the CFO Test drive the potential KPI with the

management teama age e t tea Bounce the potential KPI off the key

influencers and strategy architects


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11


Building a Seat at the Table 3: Gather and Analyze Data

Steps

Collaborate and partner with the Accounts Department

Make sure you have the right tools and training to get the proper data in a timely manner Work with the Accounts Department to

get timely data Collaboration is critical. You have to

have this mindset – you will not succeedhave this mindset – you will not succeed on your own. Your goal is to make the current people

at the table look good by making it easier f th t k d d i ifor them to make good decisions.


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12


Building a Seat at the Table 4: Communicate

Steps

Effective communication gets you listened to

Make sure you are not just sending out communications to meet quotas –sometimes less is more.sometimes less is more. Like they teach in animal obedience

class – first you must get their attention. It is less about your expertise and more

b t th ibilit fabout the sensibility of your message. It is less about what you want to say and

more about what you can get them to listen and respond to.


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Common Sense AppliedSCENEInsight Leads to Influence

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2








Insight Rules

Not data, not information – Insight

Insight We are inundated with information and data streams

Insight vs. Information

Leadership

Information

information and data streams. As the new book, Drinking

From The Fire Hose discusses, data is not only not

l bl it i i f t

Leadership

Data

valuable, it is in fact detrimental to success – it creates paralysis. But, insight is valuable and is

Management

T h i ig

the currency of Trusted Advisors.

Technicians


Common Sense AppliedWhat is Insight?

Key Performance

IndicatorsIndicators


Common Sense AppliedInsight Gets You Listened To

ence

InfluInsight


Common Sense AppliedSCENECommunication Drives Influence

1

2




4 C i ti D i I fl4 Communication Drives Influence



Common Sense AppliedCommunication is Essential for Influence

The real source of Insight’s influence is in it’s communication

NOT it’s Ownership or Control!

Wh t l t li t ? I i ht?What causes people to listen? Insight? Of course, and even better, insight that is their idea!

1. Make your targets look good. It will allow them to listen to you.2. First, the informal channels, then the formal3 How do people in your firm communicate tell stories?3. How do people in your firm communicate, tell stories?


Common Sense AppliedPresentation is Persuasive

Two articles that are worth reading prior to presenting anyTwo articles that are worth reading prior to presenting any of the KPIs that you feel advance both the marketingdepartment’s and firm’s case are:p

1. 10 Golden Rules for Presenting Financial Data

http://www.turnaround.org/Publications/Articles.aspx?objectID=8797

2. Change the Way You Persuade – Gary A. Williams and g y yRobert B. Miller Harvard Business Review, May 2002



Remember This

Context is just as importantas important as content

because it sets the stage.g


Common Sense AppliedSCENEDashboards Enhance Clarity

1

2








Dashboard

Dashboards provide an easily accessible summary of the most important insights your firm needs to make decisions.

The most important KPI for your firm The next 2 most important KPI

600Placeholder Placeholder

The next 2 most important KPI

3 4 4

400

500 12

3 4

1

2

3 4

Labor practice revenues are up

Executive Summary

200

300

Text Text Text Text

Labor practice revenues are up XXX is presenting at the ABA next month We brought in 3 new clients this month Etc.

100

200


00-10 20-30 40-50 60-70 80-90

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Common Sense AppliedEffective Dashboards

The three keys to the best dashboards:

1. Focus on what is important

2. Are simple and easy to grasp

3 Understandable by the partners3. Understandable by the partners


Common Sense AppliedMarketing Dashboard Components

Four aspects of law firm management that your Marketing Dashboard should reflect:

1. Client Management2 R2. Revenue3. Practice Management4 Client Development Cost4. Client Development Cost



Marketing Dashboard –1. Client Management

KPI

Client Retention – ratio: clients billed in t 12 i 12current 12 mo. versus previous 12 mo.

Growth in Top Clients – ratio: fees billed to top 50 clients in current 12 mo. versus previous 12 mo

Client Management

125 previous 12 mo. Client Growth Rate – ratio: new clients in current 12 mo. versus total number of active clients25

50

75

100

125

Dormant Client Percentage – ratio: number of clients not handled a matter for in 2 of the past 3 years to total clients.

02007 2008 2009 2010 2011

Number of Matters per Client – ratio: number of matters billed to the number of clients billed.


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Marketing Dashboard -2. Revenue

KPI

Average Fee per Client – fee revenue for last 12 mo. divided by the number of clients billed.Average Fee per New Client – new client fee revenue for last 12 mo divided by the

Revenue

100fee revenue for last 12 mo. divided by the new clients.Average Fee per Matter – fee revenue for last 12 mo divided by the number of20

40

60

80

for last 12 mo. divided by the number of matters billed.Average Fee per New Matter – the related fee revenue for the last 12 mo.

0 0 0 0 0 0 00May June July Aug Sept Oct Nov

divided by the number of matters billed for new clients.


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Marketing Dashboard -3. Practice Management

KPI

Practice Areas per Client –average number of individual practice groups billed to clients.Number of Lawyers per Client –ratio: individual lawyers generating

Practice Management

ratio: individual lawyers generating working fee credits versus number of clients.

40

60

80

100

0

20

May June July Aug Sept Oct Nov


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Marketing Dashboard -4. Client Development Costs

KPI

Marketing Budget Ratio – ratio: totalMarketing Budget Ratio – ratio: total marketing spend (including salaries) to total fees billed in last 12 mo.Business Development Ratio – ratio:

Client Development Costs

4 pbusiness development spend for last 12 mo. to the total fees billed.Marketing Cost per Client – ratio: total

1

2

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marketing spend (including salaries) to the number of clients billed in last 12 mo.Business Development Cost per Client

ratio: business development spend to the

2

– ratio: business development spend to the number of clients billed during last 12 mo.


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Common Sense AppliedConclusion

There is no one “right” or cookie cutter solution that works for getting a seat at the management table

because it is about them not you.

The bottom line of this presentation is to provide you with one way that you can get your partners to

switch their listening ears on!switch their listening ears on!

When you have their listening ears you have influenceWhen you have their listening ears you have influence and are well on the way to

Trusted Advisor status – the ultimate seat!.


Common Sense AppliedSCENEQuestions?


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