Welcome to the baffling world of consumer credit regulation, where the law of unintended consequences reigns supreme. Sweeping changes to the consumer credit regime come into force on April Fool’s Day. By all accounts, they aren’t aimed at law firms but only a fool would ignore them.

“Culture eats strategy for breakfast” – so said Peter Drucker, pioneering management consultant and influential thinker. It’s a long time since he coined the phrase, and although it now features high on the agenda for enlightened law firms, the sector as a whole is lagging and needs to catch up.

The link between a client’s satisfaction with a firm’s service, their subsequent loyalty and the ensued increase in profitability is perceived to be so logical that the relationship is often taken for granted. But client loyalty is generated from an understanding of each relationship and the expectations you need to exceed based on real time information such as feedback. In fact, an increase of as little as 5% in client retention is thought to lead to as much as a 75% increase in the average business’s profitability

I was much concerned by a recent exchange on the Gazette LinkedIn group. It started with a question by HighStreetLawyer’s Gary Yantin about law firms without websites and it drifted (as these things often do) to a discussion about how people block other people (described as “people who just want to sell me something”, which I thought rather pejorative) from communicating with them. Towards the end, there seemed to be something of a competition developing between people about how they managed to avoid ‘wasting’ their time talking to people.

The two primary objectives of all pricing decisions by law firms should be to maximise profitability while at the same time ensuring that the pricing structure leaves the client feeling that they have had fair value for money. And yet opportunities to do so continue to be squandered. There are many reasons for this but the most perplexing is the failure to apply pricing factors that have been available to lawyers in many countries for decades.