Are you brave enough to let your clients set your fees?

The April/May 2009 Law Practice magazine, a publication of the American Bar Association, focuses on innovation. “Running Ahead of the Pack: Trailblazers in the Law Firm World,” by Steven Taylor, profiles law firms taking new approaches to client service, partnerships, hiring and more. The first two firms profiled in the piece, Summit Law Group of Seattle, Washington and Exemplar Law Partners each provide service guarantees to clients in the form of fee adjustments.

Summit Law Group’s contracts with clients include a ‘value-adjustment line’ encouraging clients to adjust the bills either up or down as the client sees fit, based upon the client’s perception of the value of the legal work performed for them. Exemplar Law Partners uses a value based billing model and provides clients with a guarantee; if clients feel they did not receive value commensurate with the fee paid, Exemplar’s guarantee ensures that a fair price will be negotiated with the client.

Both of these firms have used guarantees for a number of years and report that clients rarely or never take advantage of them.

Lawyers: Are you prepared to offer a similar guarantee to your clients, essentially allowing them to set the fee for the services you provide, or to adjust the fee based upon their perception of the value of the services that you provided to them? And if not, why not? 

Lawyers that are not prepared to offer such guarantees may not be confident in the value they provide to clients. Alternatively, they may not be confident that their clients see the value in the services they provide – particularly when the outcome is outside of the control of the lawyer or is not what the client was hoping for. But if you’re not confident that your client sees the value of the services you provide, where is the disconnect? Are you failing to articulate value to the client in terms the client can understand, or are you working with the wrong clients?