The Crème Brûlée Latte Shop

Episode Notes

Transcript

The Un-Billable Hour
The Crème Brûlée Latte Shop
05/13/2019

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Intro: Managing your law practice can be challenging. Marketing, time management, attracting clients, and all the things besides the cases that you need to do that aren’t billable. Welcome to this edition of The Un-Billable Hour, the Law Practice Advisory Podcast. This is where you will get the information you need from expert guests and host Christopher Anderson, here on Legal Talk Network.

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Christopher T. Anderson: Welcome to The Un-Billable Hour, the Law Practice Advisory Podcast helping attorneys achieve more success. We are glad you can join us today on Legal Talk Network.

And today’s episode is about marketing and ownership and leadership and culture, and personal growth, it’s about a lot of stuff and I’m really honored today to present to you today, The Crème Brûlée Latte Shop.

My guest today is Deborah Farone, and she is the Founder and eponymous CEO of Farone Advisors. She is formerly the CMO, the Chief Marketing Officer of Cravath, Swaine & Moore, and before that, Debevoise & Plimpton, which I am sure I just murdered, but she will fix it.

She has deep knowledge and understanding of marketing and business development and overall law firm owner success.

I am your host Christopher Anderson. And I am an attorney with a singular passion for helping other lawyers achieve success with their law firm businesses.

In The Un-Billable Hour each month, we explore an area important to help you be a more profitable lawyer, through growing your revenues, getting back more of your time and/or getting more professional satisfaction from your business.

The Un-Billable Hour is dedicated to bringing new guests each month to help you learn more about how to make your law firm business work for you, instead of the other way around.

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And today’s episode of The Un-Billable Hour as I said before is the The Crème Brûlée Latte Shop. And that’s an unusual title, but my guest today is an unusual woman, Deborah Farone, Owner of Farone Advisors, LLC.

And Deborah, welcome first of all to The Un-Billable Hour.

Deborah Farone: Christopher, thank you. I am pleased to be here.

Christopher T. Anderson: I am pleased to have you. Now, it is a long-standing tradition now of The Un-Billable Hour that my introductions are terrible. So I’ve teased this one up a little bit, so I’ve given a little bit of your background, but I introduced the show as The Crème Brûlée Latte Shop, it’s just something you’ve written about and I’d like to — like use that to frame up the show.

So, tell the listeners a little bit more about yourself and what is The Crème Brûlée Latte Shop?

Deborah Farone: Well, I am currently a marketing strategic consultant, which means I help law firms with their strategy and that’s everything from their marketing departments and how they operate to strategic plans, to speaking of their retreats, but I’ve also written this book, “Best Practices in Law Firm Business Development and Marketing”, and in an article that I wrote, I have a column for Forbes. I did talk about The Crème Brûlée Latte Shop, which really my way of saying that and portraying to the world what was going on out there.

If you have lots of customers going into Dunkin’ Donuts and Starbucks on a regular basis, let’s start saying that those people want something called a Crème Brûlée Latte, and those stores don’t have it.

Well, if someone opens up down the street with The Crème Brûlée Latte Shop, they may be pulling customers over from Dunkin’ Donuts and from Starbucks, and from all the other good places, and pretty soon that Crème Brûlée Latte Shop has new customers and they start expanding their lines and serving many of the things that the older place has carried.

(00:05:00)

So pretty soon customers are moving over not only for their Crème Brûlée Latte, but for their regular coffees and for their donuts and for their other things. And what I’m trying to portray is that if firms are not possibly coming up with new and innovative practice areas and not really taking care of their clients the way the clients really need to, they can lose a little market share at first, but eventually they can lose entire client.

Christopher T. Anderson: Yeah, and that makes sense. I mean first of all I got to tell you like I’ve never had a Crème Brûlée Latte, but if after reading that article, like I’m going to the Crème Brûlée Latte Shop. So do you just open it, but I think what’s really key about that, and what I thought it was a great way to lead off the show is my listeners have from other guests heard, what I think is wise advice, which is “The Riches Are In the Niches” and niche down your practice really speak to a particular avatar.

But this goes a step farther, which I just — I found really intriguing, which is you establish this niche to serve something that’s not being some need, that’s not being served in the marketplace today, but you use that as an entree and then to just sweep in and take a lot of the other business as well, and I thought that was just a really enlightening way to look at opening a Crème Brûlée Latte Shop.

Deborah Farone: Well, we definitely see it going on with the legal process outsourcers in the legal community and the fact that they are taking some business away from law firms that law firms are not able to handle, whether because it’s work that doesn’t make sense for the law firms economically or they don’t have the proper staff or the proper technology.

And so, we can say that that’s fine for now, but the question is what’s going to happen 5 or 10 years from now? Are those legal process outsourcers or legal companies or law companies as we’re calling them going to encroach in the law firm space?

But I think it also means that there’s a great opportunity for smaller law firms and for really innovative law firms to say, well wait a second, what are those niches and can we figure out a way to really serve clients better so that they come to us for those things rather than sending them outside to a different provider.

Christopher T. Anderson: Right, yeah so to make sure that we’re guarding the castle if you will, just not allowing that encroachment on the other pieces of the business. So I want to expand the thinking now beyond — I mean again, it’s just the whole concept of the Crème Brûlée Latte Shop is just really — I think it’s very enlightening.

But I want to just kind of expand now to the book that you mentioned. You mentioned that this was an article, The Crème Brûlée Latte Shop came out of a Forbes article, but you’ve written a book called, “Best Practices in Law Firm Business Development and Marketing”. What’s that about and why did you decide that book needed to be written?

Deborah Farone: Well, it was a matter of happenstance. The folks at Practicing Law Institute had come to me and asked if I either knew of anyone or was interested in writing or editing a book and I thought, well, I’d never written a book before, I have columns that I authored, but why not try a book.

Christopher T. Anderson: Yeah.

Deborah Farone: I love to complicate problems and projects. So I delve right into it and it’s such an interesting time that it really needed to be covered with all the changes going on not only in technology, but in how lawyers are practicing and how they’re doing their own business on a day-to-day basis and how clients can now curate how they want to use law firms.

It’s just such a time of great change, and I felt that while I had great experience from the two law firms that I was at, I wanted to talk to other firms, I wanted to talk to smaller firms, I wanted to talk to larger firms. I wanted to speak to some of the multinationals and I spoke with general counsel as well as managing partners and legal technologists and legal innovators to find out what did they think was going on? What did they think the opportunities will be down the road and how are they preparing.

And so, it’s a great learning experience for me and I’m thrilled to say, it’s doing quite well. It’s selling well on Amazon and through PLI.

Christopher T. Anderson: Great. And it’s very interesting to hear that you kind of, you took it because there’s a lot — and let’s face it, there’s a lot of books out there about law firm marketing and business development. But sounds like you have really took your book and took this concept to what — to the big changes that have been and continue to be occurring and really addressed it to best practices like in 2019 or 2018, just right now, not 10, 15 years ago.

Deborah Farone: Exactly, and I spoke with people like David Perla who is now at Burford Capital, who was one of the people who started this whole idea of sending portions of your legal work outside. He started something called Pangea3, and I spoke with Heidi Gardner at Harvard who has done a lot of work on Myths of Collaboration and learned a lot from these people.

(00:10:00)

I really came at this as a reporter, trying to figure out what is it that they know or what is it that rainmakers do that make them great rainmakers. I really wanted to learn and I felt that this was a luxury to be able to say, I am writing a book, can I speak with you about how you think.

Christopher T. Anderson: Yeah. So from that experience if you don’t mind, if we can focus a little bit on smaller law firms, solos and we got through middle-sized law firms, from all your reporting and these interviews that you did, what are some key major changes that you see and understand from these folks as taking place in our profession today?

Deborah Farone: I think it’s a great opportunity and a great time to be a small firm, because if you can really focus and double down on your niche and what it is you do well, I think there’s an opportunity there.

The fact that General Counsel now are looking at things more cautiously than they had in the past as far as choosing the right providers, I think for firms it really makes a big difference.

The other way, and the other trend that we’re seeing is with technology, and so if your firm is able to figure out newer, better or faster ways of doing things, that’s also becomes a unique sales proposition. And so, that’s another way to go. But I think as a small firm, you have fewer resources so you have to be smarter about how you market and really think about where your potential clients are, what they’re doing, what they’re reading, who they’re using as law firms and what your competitors are doing, and then focus your marketing.

Christopher T. Anderson: Now when you say that General Counsel becoming more cautious I think is the word you used, is that a cautionary tale for the owners of small law firms and that the General Counsel are going to be focusing more on the tried-and-true or are they going to be willing to go for and hire these smaller law firms because of their innovative capabilities?

Deborah Farone: I think it depends on who you speak with, but with the add to this, there’s this group called CLOC and I don’t know if your listeners are familiar with CLOC, but that’s the Consortium of Legal Operations Counsel, and those are people who handle the operations side within a GC’s office, and it’s a relatively new position. And these people are trying to figure out well how do we get the right value and the right legal work, but how do we do it at the right cost.

And I think a number of them are willing to really weigh the risks versus the benefits and they may be more willing to use smaller firms, because they really do want the best expertise.

Christopher T. Anderson: Excellent.

Deborah Farone: Absolutely.

Christopher T. Anderson: Yeah. All right, well we’re talking with Deborah Farone, the Owner of Farone Advisors and we’ve been talking about the changes that she sees taking place in the legal profession particularly in relation to the book she has written, the “Best Practices in Law Firm Business Development and Marketing”.

We are going to take a break now and hear from our sponsors. But when we come back with Deborah, I’m going to ask her about Chief Marketing Officer. She has been one and we’re going to ask for some advice on that after we hear this message.

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Christopher T. Anderson: And welcome back to The Un-Billable Hour. This is Christopher Anderson, we are talking about Deborah Farone of Farone Advisors, LLC. We have been talking so far about the changes in the legal profession, and now I wanted to just scoot right into the topic of the Chief Marketing Officer or CMO.

Deborah, I work with a bunch of small law firms and as they cross into getting revenues in the seven and eight figures, a lot of them want to hire that role. You have been in that role, and sometimes I am very cautious about it with them particularly based on a recent article by Seth Gordon and other advisors that maybe they want to hold on to that role themselves for a while. But I wanted to hear your take and your advice on when it’s the right time for a law firm to think about engaging the services of a Chief Marketing Officer?

Deborah Farone: Well, it is probably a good thing that you questioned them about jumping into it, because I think there are lots of alternatives especially for smaller firms.

(00:15:00)

There are terrific consultants out there in all different markets to do all kinds of different things who are excellent and that might be the way to go especially if a firm has a limited budget or if this is something that the chair or the owner of the firm really wants to hold close to the vest for whatever reason that is. But when they do decide to hire CMO, I think they have to be very careful about really thinking what skills do they want to hire in that person. I think that’s a big part of it.

Christopher T. Anderson: Yeah.

Deborah Farone: Very often, I think we’ll see job descriptions where it looks like a firm wants everything soup-to-nuts from their CMO and they might get someone who does that, but then the CMO is very frustrated when they find out that they are not doing social media and they’re not doing advertising or they’re not doing pricing.

So I think firms need be cautious about really developing a job description and looking at maybe the Legal Marketing Association website to see what job descriptions look like and then, honing it down to those things that they need to do and that they really want to accomplish.

So I think that’s really the first step.

Christopher T. Anderson: Right, yes, yeah. So making sure that they actually need that role and how they would describe it, that’s really great, that you were about to say something else about it.

Deborah Farone: Oh no, I think the other thing that really matters of course is culture and finding the right cultural match, because you might find a marketing person who wants to go a hundred miles an hour but your firm is more conservative, and that’s not right for your firm or for your market.

So I think that honesty factor with yourself but also with whoever you’re interviewing really needs to be front and center to make sure that you get the right match.

Christopher T. Anderson: Yeah, so a CMO that matches, like whose natural inclination is natural, what you said, cultural fit matches the direction you want to take the firm in the aggressiveness with which you want to grow it, makes a whole lot of sense. What about the — what I see and I think the part of why I caution people about and what I’ve seen happen is that a lot of — particularly in the smaller firms, the owners think that hiring a CMO means they don’t have to worry about marketing anymore, like they just sort of abdicate the role.

But can you speak to that concept of do you just like hand the keys to the CMO or what’s the owners continued involvement?

Deborah Farone: Yeah, I think the owners absolutely have to still be involved. It may mean a little less work for them but they’re not hiring someone to do administrative work, they’re hiring someone to market. So they need to be in constant conversation with them and letting them know what the changes are in the firm and what’s going on with the firm’s strategy and who the new clients are.

So they really do need to work very, very closely and have regular meetings and be involved in I think initially the right kind of on ramping for that person whether they’re called the CMO or a marketing director, but making sure that that person is introduced to the right partners, that they receive kind of the blessing of whoever the head of the firm is, and that they’re given a really good but ambitious write-up of what it is that they’re supposed to achieve.

So they need goals, they need objectives and they need attention.

Christopher T. Anderson: Yeah, real KPIs or OKRs which we’ve talked about in previous shows, but real measurements of what success looks like for them. Now, you just in that explanation, you used the S word, so I do want to go into that now. You said strategy that they understand the strategy and my experience has been and I know I believe you’ve seen this as well, that a lot of law firms; in fact perhaps, most law firms don’t really have a strategic plan.

First of all, is that your experience and why do you think that is?

Deborah Farone: There are some statistics on this and I need to go find them again. I don’t know if they’ve changed but they — I think I said something like the last time I looked at them maybe 60% of firms had some type of strategy, but that meant that 40% of major firms at least didn’t.

I think it’s a big mistake. I think any business needs a strategy. It doesn’t necessarily have to be a strategy that they’ve hired McKinsey to do, but they should at least have a one-page strategy if they’re a small firm. That says this is what we want to be, this is the type of practices that we want to have, this is how we’re going to get there and here’s our plan, and the plan should have actionable steps.

But I don’t think that firms do it, because I think sometimes they just don’t know. They don’t know how to do it or they think it’s going to be expensive to hire a pricey consultant to do it for them. But I don’t think that’s necessarily the case and I think it’s just a big error for any business not to have some kind of direction.

(00:20:00)

Christopher T. Anderson: Yeah, a North Star that tells them what success looks like. I mean sort of the same thing you were talking about with hiring the CMO, right? How does this — if the CMO doesn’t know what success looks like, they’re not likely to get there, same thing for the whole firm. If you just could like lay out, what would you say are some of the key attributes of a solid strategic plan? How does a firm know if they’ve really got one?

Deborah Farone: Right. I think it starts with research and looking at what the marketplace is that they’re in and who their competitors are, what their competitors are doing and what the share of the market is, and there are a whole bunch of questions about where they stand within that marketplace, and that’s really the first thing.

And then to really do an evaluation of who these folks are, what does the firm stand for, what are their practice areas, what are their strengths, weaknesses, opportunities, and threats. You really want to go through a whole SWOT analysis.

And then there are other steps that you can do in that research process where you’re talking to clients and speaking to third parties. But I think then as a smart consultant is going to really work with a firm in figuring out what the next steps are, what are the practices to strengthen, what are the practices maybe not to go into and really come up with a plan whether it’s a five-year plan or a 10-year plan, but it depends on the firm and it depends on what the brief is.

If it’s a leadership kind of question or if it’s a client question, usually a firm needs to really specify what they want to have out of its strategic plan.

Christopher T. Anderson: Yeah, certainly but it should provide that North Star where are we in fact going. We’re talking with Deborah Farone with Farone Advisors and we’re going to take another break here real quick. And when we come back with Deborah, I’m going to move on from asking about strategy to talking a little bit about culture. But first, we’ll hear this word from our sponsors.

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Christopher T. Anderson: Welcome back to The Un-Billable Hour. I’m talking with Deborah Farone of Farone Advisors and we’ve been talking about the best practices in law firm business development and hiring a Chief Marketing Officer, just finished a really neat discussion on strategy. I wanted to turn the conversation now to culture.

Deborah, when we were talking about the CMO, you mentioned that one of the things that you want to do is focus on making sure you get a good cultural match, and that just made me think about asking you this question about culture. I’ll first just start with a quote, I think it’s — you know what, I’m not sure who it’s from anyway that called the — I think it’s Drucker actually, say that “Culture eats Process for Breakfast”. Have you ever heard that quote?

Deborah Farone: I have. I’ve also heard the Culture Eats Strategy for Breakfast, so I don’t know which is the right one, but culture must be eating a lot.

Christopher T. Anderson: Indeed.

Deborah Farone: There are firms that pay attention to one thing and not the other, you really can’t have one without the other.

Christopher T. Anderson: Right. So let’s just start with this if you don’t mind. It’s like what does that phrase mean to you? Why is culture so hungry and why is culture eating everything for breakfast or lunch?

Deborah Farone: Because without the right culture and without the right attention paid towards people especially in a professional service firm, it’s very difficult to get people to not only do what they are supposed to do but excel at it. So you have to have not only a group of people who are getting satisfaction from their job but people who know what the strategy is and there are firms that do that and do it well.

And I’ve seen a number of them where they really excel on having a strong culture whether it’s some of the larger firms like Vinson & Elkins, does a great with this. They have two leaders Mark Kelly and Scott Wulfe who really concentrate on a strong culture.

(00:24:52)

But then I’ve also seen it with smaller firms like Sherman Wells in New Jersey where their associate and their associate training is so important to them that they are constantly making sure that these associates are working directly with clients.

So you can really tell it makes a big difference not only to the people within the firm, but the clients can tell and you’re much more likely to achieve your objectives if you have a strong culture.

Christopher T. Anderson: Yeah I think it just helps to get everything in line and get great alignment like you said, among the associates, the partners, the staff and the clients. I mean that culture just kind of lines everybody up and marching in the same direction in the way that just pure strategy can’t do, because pure strategy doesn’t ensure that everybody’s bought into it, it’s just a statement. But culture really has everybody marching, looking in the same direction.

Deborah Farone: Absolutely, and I think the way you treat people will eventually have an impact on your business, because either people will talk outside of the firm or their performance won’t be as good or clients will catch wind of it. It really has a detrimental effect when firms are not paying attention to their culture.

And I think if you don’t pay attention to the culture, you kind of get the culture you deserve, but there are firms where they’re constantly keeping with whether it’s a mission statement that’s written out or two or three points that they want people to think about where you hear leaders repeating the same thing over and over again, and it doesn’t mean that you have to sound like your artificial intelligence.

But I think to have a message and a theme and to really make sure that you’re hammering it home and displaying all the right behaviors that support it, is just so key and really building a successful firm.

Christopher T. Anderson: Yeah I couldn’t have said that better. And I think that’s a great place to wrap it up. Deborah, I could talk to you all day, maybe we’ll have you back, because there’s just so much else that you touch on that would be a value to our listeners. But I want to just say thank you very much for being a guest on The Un-Billable Hour.

Deborah Farone: Oh, it has been my pleasure. It’s been a great time talking with you.

Christopher T. Anderson: You as well, and that wraps up this edition of The Un-Billable Hour, the law business advisory podcast. Our guest today again has been Deborah Farone, the owner of Farone Advisors, and you can learn more about her at deborahfarone.com. And Deborah did you want to share if the listeners want to learn more about anything you talked about or anything we didn’t get to today, how else should they get you other than your website?

Deborah Farone: I’m on LinkedIn, it’s Deborah Farone and that’s probably the best way of finding me. I’m also @DeborahFarone on Twitter so they can link in or tweet or go to my website.

Christopher T. Anderson: Wonderful and that is just so everybody knows that’s the last name is Farone. And this is Christopher Anderson and I look forward to seeing you all next month with another great guest as we learn more about topics that help us build the law firm business that works for you.

Remember, you can subscribe to all the editions of this podcast at legaltalknetwork.com or on iTunes. Thanks for joining us, and we will see you again soon.

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