Professional service firms have increasingly been pushed into the digital world, where remote working, virtual meetings and online platforms are growing more and more popular. As a result, the level of dependence placed on digital tools and technologies to carry out day-to-day tasks, streamline assignments and manage client relationships.

One such technology category is the umbrella of client relationship management software, which is one of the biggest software markets globally. It is estimated that CRM software implementation is expected to generate over $80 billion in revenue by 2025 [1]. This article outlines how client relationship management software can benefit your legal practice and why you should consider incorporating it into your business functions.

What is Client Relationship Management Software?

A Client Relationship Management software combines technologies, strategies, and systems that law firms and other businesses use to organise and analyse client interactions and other information throughout their entire relationship with a client [2]. It is an information-technology enabled strategy that allows law firms to identify, target, acquire and retain the most suitable clients for their business [3]. Through Client Relationship Management software, law firms can offer their clients a unique, personalised and seamless experience.

How is it Beneficial for Law Firms?

Client Relationship Management software is more beneficial to law firms than any other type of business within the professional services industry. Even seemingly simple and non-convoluted tasks, such as enquiry tracking and keeping in touch with clients, can generate more business for the firm, through referrals, as well as providing improvement of life features for lawyers.

Retains & Attracts New Clients

Features embedded within CRM software notify law firms when a potential client has visited their website. Law firms can then use this information to reach out to the prospective clients. This can be a factor that sets a firm apart from its competitors, as they are actively reaching out to clients, instead of waiting for them to be contacted by anyone who needs legal advice. CRM software profiles potential candidates to recognise their needs based on which part of the website they are visiting and allows the firm to take the first step in establishing a relationship. Moreover, due to the benefits associated with CRM software in terms of providing better client services, clients are more likely to stay with a law firm that continues to develop and improve on the customer experience they provide.

Easier Access to Client Information

As the name of the software suggests, CRM provides a well-organised and efficient system to manage all client interactions and information, including their contact details, email exchanges and details of previous projects worked on. Having an organised database where lawyers can easily access key information about a client allows you to keep updated regarding your client and update them on any developments with their case or transaction. Suppose a client asks for information on short notice or requires an update immediately. In that case, you can easily access their information, without relying on another colleague who has worked closely with the client. The last thing a client wants is to be left in the dark regarding their situation. Using CRM software prevents delays and allows for easy communication between the firm and the client to ensure that they are kept up-to-date and well informed regarding their situation [4].

Increases Internal Collaboration

CRM software efficiently manages clients between different departments within a law firm to increase inter-department collaboration. There are many cases where providing a service to a client involves working with multiple different teams across various offices. To ensure that service is provided successfully, CRM software allows firms to overview the team’s tasks, enabling you to track how each task progresses. Such features make allocating and scheduling tasks an extremely effortless process, allowing firms to efficiently meet their goals and achieve the desired outcome. While such tasks may seem extremely simple at first, carrying them out on a large scale can be extremely daunting and can create much confusion if done manually without using the software.

Better Organisation, Transparency & Communication

Regardless of the firm’s size, every firm can be guilty of either ignoring a client’s enquiry or severely delaying the response time. Consistent communication is essential for law firms to build relationships and manage their internal operations successfully. CRM software helps in this prospect, as the technology prevents the loss of any potential clients by ensuring that their calls and leads are not neglected [5]. This is one of the core functions of CRM; automating and keeping track of all client interactions. CRM software also provides templates that lawyers can use to keep track of meetings and appointments. Such features allow an inquiry that comes in to be quickly converted into a profitable client [6]. Lastly, as all client information is stored on one centralised database, internal processes become more transparent.

Improves Firm Reputation & Expands Network

A law firm’s reputation is key to its business. Building strong relationships with clients allows you to build your network and generate more business from referral work due to the firm’s reputation. However, the exact opposite can happen if the firm does not manage its client relationships well, making CRM software extremely important. CRM software adds value to the business by cultivating positive client relationships to ensure that all clients’ needs are met.

Better Data Analytics & Insight

CRM Software is an information technology tool, makes client data intelligible and ensures that the data collected is relevant to the business [7]. Law firms have access to which clients have been contributing to the highest profits over a period of time and which clients are most likely to come back for a service. This allows you to understand what your client demands and how many of the firm’s resources need to be allocated to that particular client [8]. Additionally, the data generated allows the firm to tailor its marketing to individual client needs based on their data. Another important usage of CRM data analytics is predictive modelling. This involves comparing different business development models to measure their potential success rate based upon existing client information [9].

What about smaller firms?

CRM Software undeniably assists in managing client information and relationships, enabling lawyers to identify emerging opportunities for the firm’s betterment. It can be seen why such an investment would add value to a global law firm with multiple offices worldwide and a huge client base. However, smaller firms can also benefit from CRM software. A small firm needs to look at its client base holistically, instead of only focusing on each client at a particular time. It allows smaller firms to retain more clients, and sometimes, they may struggle to expand outside of their existing network or geographical area [10]. There are also CRM softwares, specifically built for small businesses. While they may not contain all the features associated with CRM software, it does not matter as small businesses do not make much use of them anyway especially during the earlier stages of their growth [11].

When Should You Invest in a CRM Software?

To make best use of CRM software, you need to understand why your practice needs one. The first step is to evaluate the firm’s short term and long term business development goals. A CRM software is an investment that requires a plan to be in place to ensure that a firm knows which areas it wishes to focus on. If your goals do not align with what CRM services offer and aim to achieve, investing in such technology may not be an optimal use of your finances. However, creating a plan with clear cut goals allows you to analyse and track progress through CRM software [12].

Investing in CRM software is particularly beneficial for a firm that has expanded its team and is looking to operate more effectively. If your firm is going through an expansion or a merger, there will be more complex client data to deal with. Such information needs to be organised through a CRM system to manage client expectations. Without utilisation of a CRM system, lawyers at your firm may find themselves working too extensively on the administrative side of client management. If this is already the case, it is likely time to invest in CRM software, so that your legal professionals can allocate their time more wisely to other, more complicated, tasks that cannot be automated. Lastly, if your firm is continuously missing reminders or notifications from clients, resulting in missed opportunities and frustration, CRM software can ameliorate miscommunications and ensure effective response measures for client interaction.

In Conclusion

It has become a norm for law firms to use technological tools, like CRM software, to streamline and enhance their business functions. CRM software has proven to be an invaluable tool for client retention and management as many tasks are automated, such as scheduling client appointments and setting reminders. Not only does this increase firm productivity, but it provides an improved service to the client, which results in a better firm reputation and generates more referral work. Furthermore, the benefits of CRM software are not just limited to big international law firms. Many small and medium-sized firms can afford and successfully implement CRM software with minimal training.