Increasing ROI from your RFP responses.

• Author: Desai, Seema

Lawyers are operating in a new era of business development, one in which it has become increasingly challenging to bring in and retain new business. The buyer's market has created an opportunity for in-house counsel to demand more value from their legal service providers.

RFPs have become a popular tool for in-house counsel to lock-in competitive rates and develop a streamlined preferred provider list. According to the 2012 LexisNexis[R] RFP Activity Summary Report, of the more than 350 law firms surveyed, 42 percent reported an increase in the volume of RFPs they received during the 12 months prior. According to this same survey, firms with more than 500 lawyers prepared an average of 192 proposals last year, devoting an average of 25 hours to prepare each proposal. When you do the math, that's about 92 non-billable hours per week of attorney and staff time!

So what can you do to stand out from the crowd when responding to an RFP? If you are trying to retain the business, you already have an advantage over a firm that is not currently providing legal services to your client. If you are trying to win a new prospect, there is a good chance that you are up against one or more firms that already have a relationship with that prospect. To improve your chances of winning profitable work, below are a few must-dos.

Opportunity Assessment

Not every RFP that comes through the door merits the amount of lawyer and staff time it takes to prepare a response. Assessing the value of the opportunity is vital to any successful business development strategy. Questions to ask at the opportunity assessment stage include: Does anyone at the firm have an existing relationship with this client? If we were to win the work, do we have the resources to handle it profitably? Do the work and the prospect align with our long-term growth strategy? Which firms are currently representing this prospect? This last question is particularly important because if the prospect has a preference for a specific firm to handle the type of work that you are bidding for, it could be a red flag. For one, it indicates that they are generally pleased with the quality of service provided by the firm. Second, since their relationship with that firm is already so strong, it's likely they sent the same RFP to that firm. Third, most likely, the existing firm will do whatever it takes to retain the business, even if that means cutting their rates.

Review the RFP and Ask Questions

Once the firm...