BOOK REVIEW: Smarter Pricing, Smarter Profit by Stuart J.T. Dodds

(American Bar Association, 2014, 381 pages, $169.95)  

Now that concepts such as price negotiation, legal project management, and procurement have forever become part of daily life at major law firms, it’s time for a book that presents the ideas behind them clearly and non-technically to professionals who need to understand them on a day-to-day basis. This effort by Stuart Dodds, director of global pricing and legal project management at Baker & McKenzie, is that book.

Dodds starts, where he should, with the rise of the “new normal.”  Now that law firms are constantly competing for work on the basis of price among other factors, a knowledge of pricing – how to set a price, how to actually receive that desired price, and how to manage a matter once a price has been set – is indispensable.

Dodds’ chapters on legal project management (LPM) demonstrate a practical, in-depth knowledge of the subject. They also provide an explicit link between LPM, budgeting, and the new normal: “There is an increasing expectation,” he writes, “that law firms also begin to stick to the agreed budget, with this budget now effectively becoming a cap. (Given how some law firms actually manage their matters, this for some has come as a shock.)”

His approach to starting an LPM program is straightforward: “Keep it simple – initially focus your efforts around the people, then processes, and only then the systems....Take the mystery out of LPM and put back the pragmatism. Don’t over analyze it – it is better to do something, try it, refine it, and then do something else. “

Dodds writes clearly and pretty much stays away from financial jargon and consultant-speak. When he presents a chart, he explains it non-technically and without equations. He seems to be keeping in mind that most of his readers will not have a background in finance or accounting. In fact, I think the readers who will most benefit from the book are law firm managers and practice group leaders.

Before entering the law firm world, Dodds worked in consulting, including 14 years at Accenture.  Because of that background, he’s not afraid to discuss the “p” word when it comes to law firms – and here I mean not so much price as procurement.  While many lawyers still see procurement as irrelevant or even dangerous to the business of law, Dodds embraces it and empathizes with procurement professionals since he once was one himself:

“Those in procurement are looking for the tangible outcomes from the successful tender, they are looking for proof and the ability to measure (in part so they can quantify their own contribution), they are seeking evidence that you can do what you say you can do, they want to be able to quickly quantify the overall organizational return on investment, and finally, they want ‘demonstrable value,’ ”he writes.

On the other hand, Dodds recognizes that that the procurement mentality isn’t infallible. He tells the story of a senior lawyer who was asked to visit the procurement office of a client to finalize a contract. The procurement head demanded that the firm immediately agree to reduce its hourly fee by at least 15 percent. The lawyer reminded the procurement head that his law firm was being hired to protect the company from a potential multi-million dollar claim and started to walk out. Dodds’ conclusion is that in this instance, the client’s “inexperienced procurement people” had “mistaken price for value.”

The book is full of anecdotes like this that help ensure that the book’s messages about how to set a price, get a price, and adhere to the price are not forgotten.

By Jonathan Groner, writing and public relations consultant for the July/August 2014 issue of the Capital Ideas Newsletter 

Recent Stories
What’s Next? Career Development for the Mid-Career Professional

2019 Mid-Atlantic Your Honor Award, Technology Management: Beveridge & Diamond

LMA Mid-Atlantic Region Program Recap: Measure Everything: How to Automate Data Collection from CRM, Email, Social Media, Web...