Like lawyers, marketers are great at inventing buzzwords, and one of the current sexy terms in legal marketing is “product manager.”
A reporter recently sent me a video clip touting product managers at a large, technology-focused West Coast law firm and asked me what I thought about the new and unusual trend.
I disappointed her by saying that I first heard about it in 1969, when I was working in industry and was offered a product manager position in a new organization created when my company merged with another one. I asked the Harvard-educated CEO, “What is a product manager?” I had never heard the term before. When pressed, he literally could not define it. It was a new concept he had heard at Harvard but never really understood.
The bottom line, as they say in business, is that the product manager has the responsibility for a given product and is obligated to create a consensus among the sales and production people about what and how to make the product and what to charge for it — but with no authority to control the profit.
In essence, that makes the product manager a cheerleader without the ability to determine the end result. The product manager has all the responsibility but no authority.
That raises real questions about how effective a law firm product manager can be. At the firm in question, the product managers analyzed historical data on what the fees were for every practice area, broke it down into patterns and trends, and used it to set analytical budgets for new matters.
That, however, is not the real product management process in a law firm. What that requires is a good relationship with the client, a partnership built on trust. In a legal setting, the product is the lawsuit, the negotiation or the merger. The lawyer is in charge of the product and must manage it efficiently, understand the firm’s available resources, and allocate them in the most economical way to give the client the greatest value.
The issue transcends the matter of hourly rates. Today’s hue and cry, especially regarding Big Law firms, is over the lawyers who charge $1,000-plus hourly rates. Clients resist and require a discount of some kind. Attorneys know that and raise their fees accordingly (sound like the department store raising its prices just before the Christmas discount offers?). So the financial officer of the client company insists on getting a discount, the lawyer gives it, the general counsel gets his legal service and everybody’s happy.
But product management should not be an adversarial process. Without client buy-in and approval, it’s meaningless. The system, including all subsequent communication, must be a collaborative effort. If the parties can’t trust one another, if the client and the lawyer behave as foes, the representation likely will be unsuccessful and result in difficulty when collecting the fee.
Collaboration means communication. Because lawyer and client each have unique information at any given time, both must advance the process together. Honesty, openness and candor right from the start will make the entire representation easier and more successful. No amount of data-driven product management will change that.
