News last year of another law firm marketing alliance between UK law firm Bird & Bird and South Korean law firm Hwang Mok Park (HMP) highlights the potential attractiveness – as well as pitfalls — of international law firm marketing alliances. The logic for this tie-up, like most similar tie-ups, is clear: “[South Korea’s increasing importance as a source of outbound investment] and a legal services market that is opening up to the west”, as The Lawyer detailed at the time. The recently announced Olswang/Haldanes non-exclusive marketing tie-up is yet another example of these frequently consummated alliances.
Importantly, as The Lawyer highlights, many of these efforts fail
“It is a well-known fact, as Yun Kriegler wrote at the time of the Bird & Bird/HMP alliance, “that making strategic alliances work can sometimes not be a very a smooth sail, not least because in the long-term there is no aligned economic interest.” For example, Kriegler cites a decade long joint venture between Linklaters and Singapore’s Allen & Gledhill which fell apart.
The Bird & Bird/HMP tie up seeks to buck the propensity for these alliance efforts to fail. “We’ve learned our hard lessons at the beginning with our alliances in Europe. But now we know well how to make these relationship work,” Bird & Bird CEO David Kerr told Kriegler.
According to The Lawyer, citing firm leaders in both firms, the key characteristics of the Bird & Bird/HMP alliance include:
- A cooperation agreement that is neither a profit-sharing arrangement nor an exclusive strategic alliance.
- The deal didn’t require regulatory approval.
- Low risk, cost-effective and practical
- Bird & Bird has been working with HMP for a decade on Korea-related matters
All these characteristics are helpful for the Bird& Bird/HMP alliance, However, they’re not enough nor are they the most important elements necessary to create a successful law firm marketing alliance. There are other, more essential components which are required for these tie-ups to work. They include:
- In order to effectively build an effective marketing tie-up with another firm, it is not enough to simply establish a relationship and “hope” your new partner refers business to you (however attractive the tie-up may appear in theory). Both firms must take a proactive approach to business development as a part of their firm culture and the joint alliance business development efforts in particular.
- Both firms must commit to regularly identifying and pursuing outstanding leads they are developing for one another. In order to do this most effectively, large international firms need to have internal staff in place capable of performing all these tasks (from research and identification to pursuit and capture of new business – whether from existing or new potential clients. Both efforts are unique and staffing each requires understanding which skills sets are essential to the roles. Placing a practicing partner in charge of managing the day-to-day efforts associated with implementing this effort is not advisable — appointing a highly capable, full-time business development professional is).
- An effort must be put in place to regularly identify and review new leads and discuss what specific opportunities exist in your respective markets – so as to help your alliance counterparts narrowly focus on who they should be contacting (existing clients/new potential clients) in their jurisdiction on your behalf.
- Finally, following-up during the entire business development process must be donewith any new lead generated. Without sufficient follow-up, the purpose for establishing the alliance will be defeated.
Proactive, precise and informed efforts required for success
As The Lawyer reported: Bird & Bird’s CEO David Kerr [believes] the Bird & Bird/HMP tie-up is a “low risk, cost-effective and practical cooperative agreement approach [and] is the best way forward in Asia” – a key market for the firm. Bird & Bird and HMP, based on their previous relationship, have created a solid foundation for generating new work from the relationship. However, in order to maximize new client engagements from these alliances, a proactive effort staffed with highly capable business development professionals and characterized by consistent, informed follow up to the close of new client engagements – is an absolute requirement.