July 10, 2023
By Liza Vasquez CMC ICF and Jeffrey F. Silber CPA MBA CMC
What Does It Mean for a Lawyer to Be a Trusted Advisor?
If you can become a Trusted Advisor, you will have gained a significant advantage over other lawyers who would like to replace you; and you will obtain a multitude of benefits that you might not have thought about ahead of time.
What Is a Trusted Advisor?
A Trusted Advisor is given a seat at the client’s planning table instead of being just another external lawyer.
You will be considered a strategic partner whom the client sees as an asset that can help them realize their goals.
Most lawyers play some role in the success of their clients. A Trusted Advisor will be involved in the more strategic decisions that the client makes. In many cases, the external lawyer is called in to help the client carry out a decision that has already been taken.
As a Trusted Advisor
You get to discuss what the client is doing before the decisions have been made. You will participate in the thinking process about what the client wants and where they are planning to go.
Clients will see you are far more than a competent lawyer. They will see you as an insightful, intelligent person whose objective opinions on a wide range of subjects are valuable to them.
The client will want to hear your independent new ideas which will help them make informed and useful decisions beyond just your legal point of view.
How Do You Know If You Are a Trusted Advisor?
There are some distinct differences in the relationship with a client of the external lawyer versus the Trusted Advisor.
Most likely, when clients ask you solely for your legal advice and opinions, they do not consider you their Trusted Advisor.
Trusted Advisors are usually asked for their input on more general industry issues not just legal matters.
How early are you brought into discussions?
Are you brought in when the client is already accepting proposals to realize an ’already taken decision’ or are you brought in earlier when the decision has not yet been taken?
Being part of the planning and decision-making session(s) is a good sign that you are a Trusted Advisor. It demonstrates that your client’s interest in your input is far greater than just your legal services.
You may be able to tell based on how interconnected your law firm is with the client’s team. If you are only in contact with the in-house lawyer(s) it is not a good sign for your status as a Trusted Advisor.
However, if you are familiar with, and connected to, higher corporate officers and with the heads of actual operating departments, as well as those responsible for some strategic elements of your client’s business, you are likely considered as a Trusted Advisor.
Why You Should Want to Be a Trusted Advisor: The Benefits
When your clients are paying your bills and they repeatedly bring you back when they have other legal issues, then what is the need to play an Advisory role in their company?
Here are the eight main benefits to be gained when you become a Trusted Advisor, most of which you will not see without this specific growth in your relationship with the client:
1. Higher Guarantee of Client Retention
Instead of just being another law firm whose services are subject to competitive bidding whenever a legal matter arises, or searching for a law firm that has more specific expertise on the current issue, they will automatically turn to you and your law firm.
Gaining the trust of your clients gives them more incentive to retain you and your law firm, to manage all their future legal matters. The distinction is a great sign that you will be able to retain this client just as long as you do a good job in maintaining the relationship.
2. Less Pressure on Your Fees
As a Trusted Advisor, you are part of the client’s team. As a result, you will be the automatic go-to lawyer and law firm when they have a legal issue that needs to be dealt with. You will not be put in a competitive bidding situation.
As long as you are not abusive with your fees, the client will accept your invoices as appropriate to the services you are (or will) render.
3. Get First Wind of New Ideas
If your clients are heading toward some significant changes in their business plans, you will need to know about it to keep up the same high level of service in fulfilling their needs. As a Trusted Advisor, your clients are likely to run these new ideas by you long before they implement any contemplated action.
This will be enormously helpful when you draft a revised proposal of your services for the client’s changing and growing needs to match the nature of your relationship with the client.
4. Hear Concerns and Receive Feedback Quickly and Continuously
When issues arise, you can only fix them effectively and headed off any potential rift in the relationship with your client if you know about these possible problems early enough. These issues will be discussed in a calm, matter-of-fact non-accusatory manner with their Trusted Advisor.
Having attained the status as their Trusted Advisor will help ensure that you know both the good and the bad of what is going between your organizations long before an issue becomes a serious, relationship-threatening problem.
It might be mentioned as simply as By the way …..
And you will have a better opportunity to deal with, and resolve, an issue before it becomes an actual problem. It will make moving forward with your client much smoother.
5. Create Stronger Company-Level Relationships
When your connection with a company is only through their in-house counsel, it is common that a change in the client’s personnel or a reorganization might adversely affect your ability to continue as their outside counsel.
Relationships that are based solely on providing your services for their legal problems of the day can never be as strong as those that are companywide.
When your law firm and the client’s company are interconnected as strategic partners, the bond between your organizations is stronger; and can operate more smoothly in most cases, even in view of shifting personnel on the client’s staff.
6. Better Data Forecasting
When your client partners with you, they are generally more willing to share the data, research and statistics that they have collected on a more real-time basis. This is going to be important for you in several ways.
By providing you with this information, which is not generally available, your client will make you more knowledgeable about their industry. You will not only be able to give them a more informed opinion, but also, it will make you more of an industry expert.
Access to this research will allow you to forecast the direction that your client’s business is likely to take. Understanding your client’s position in their industry and forecasting for them will help you make more strategic decisions and earn even more trust as you go on.
By understanding where your client is headed, you can more easily predict the growth of your own law firm.
7. Your Law Firm Has More Control Over the Relationship (Cross-Selling)
As an external law firm, in the final analysis, your job is to follow the instructions of your clients. Hopefully their decisions will be subject to your advice and experience.
Be aware that clients will always do what they want, and they may not be willing to trust you enough to take your advice – no matter how infuriating that can male you.
But a Trusted Advisor can help steer the partnership between your organizations in a direction that will benefit both parties in the long-term. You can help advise your client on how to better utilize your firm’s services most effectively and this can more easily lead to cross-selling (which we call cross-servicing).
8. Efficiency in Business Deals
With a higher level of partnership, you can make things happen more efficiently for your clients.
We will discuss How to Become a Trusted Advisor
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