Page 57 - The Handbook - Legal and Accounting Networks 81
P. 57
Law and Accounting Networks and Associations
Network meetings are financed in many different ways. Financing will depend on the type of meeting, the type
of network, and its membership. The three primary types of revenue are registration fees, member sponsorship
fees, and third-party sponsorship fees.
The network must decide the level of the event. There are networks that host strictly five-star events, which
are very costly. A registration fee will be quite high. In addition to the registration fee, the network will have
to take into consideration hotel, meals, and airfare.
The registration fee can be set to cover all costs. However, many networks rely on their members in the location
where the event will take place to sponsor the event. The rationale is that the sponsor will be able to showcase
its firm to hundreds of member professionals who will spend hundreds of thousands of dollars to attend the
meeting.
The third is outside vendors. The ability of the network to attract outside vendors is dependent on several
factors. The number of attendees is important, as is the demographic of the attendees, e.g., if they are worldwide
or from a concentrated practice area. In order to attract these vendors, the organization will have to design a
description of the cost and benefits of advertising.245
Director and executive committee meetings are different but related to both the annual and regional meetings.
Every organization will be unique. However, in the planning of the board and executive committee meetings,
it is important to factor in the other events. The presence of board and executive committee members at regional
or practice group meetings reinforces that everyone is a member of a network.
Referrals – How They Work and Do Not Work: Type 1, 2, 3, and 4
The referral concept is inherent in the DNA of the network. Unlike many other aspects of networks that are
related to the level of the network, referral possibilities are limited only by the imagination of the members
and staff. However, as Friedheim indicated in Exhibit 4246 found earlier in this chapter, referrals are a function
of the level of member activities. The value of a network rests primarily in the members’ hands because they
control the level of activity. There are four referral types ranging from contacting a member firm for
information to a full-scale joint venture.
When the idea of a network is proposed, one of the first thoughts is that the network will produce referrals,
i.e., income. Many see network membership as producing in-bound referrals of clients. Others join networks
to have qualified firms to which they can refer business. They recognize that referring a good client can be
risky. Referring to a network member they know has the least risk.
An example is when a client needs advice in another country; the network can be used to locate a member who
can assist. The member retains the clients and the member in the distant location may obtain business. Network
membership allows the member to assist its clients. The client is not tempted to go to a firm that has a number
of branches. The most simplistic value is to be able to refer the client to a competent professional for
information and possible business. This is a Type 1 referral. It is simple, easily understood, and fundamental.
These basic concepts do not do justice to the power of referrals. It would be like judging a carpenter’s potential
simply by looking at his hammer, saw, and screwdriver. The reason the general members see referrals in these
simplistic terms is because of the geographic perspective of the network. If the only expertise you can access
is based upon location, the “referral to” or “referral from” terminology and concept apply.
245 Sponsors, LEX MUNDI, www.lexmundi.com/lexmundi/sponsors.asp.
246 See supra Chapter 4, Organizing a Traditional Law Firm Network – Exhibit 4.
45
Network meetings are financed in many different ways. Financing will depend on the type of meeting, the type
of network, and its membership. The three primary types of revenue are registration fees, member sponsorship
fees, and third-party sponsorship fees.
The network must decide the level of the event. There are networks that host strictly five-star events, which
are very costly. A registration fee will be quite high. In addition to the registration fee, the network will have
to take into consideration hotel, meals, and airfare.
The registration fee can be set to cover all costs. However, many networks rely on their members in the location
where the event will take place to sponsor the event. The rationale is that the sponsor will be able to showcase
its firm to hundreds of member professionals who will spend hundreds of thousands of dollars to attend the
meeting.
The third is outside vendors. The ability of the network to attract outside vendors is dependent on several
factors. The number of attendees is important, as is the demographic of the attendees, e.g., if they are worldwide
or from a concentrated practice area. In order to attract these vendors, the organization will have to design a
description of the cost and benefits of advertising.245
Director and executive committee meetings are different but related to both the annual and regional meetings.
Every organization will be unique. However, in the planning of the board and executive committee meetings,
it is important to factor in the other events. The presence of board and executive committee members at regional
or practice group meetings reinforces that everyone is a member of a network.
Referrals – How They Work and Do Not Work: Type 1, 2, 3, and 4
The referral concept is inherent in the DNA of the network. Unlike many other aspects of networks that are
related to the level of the network, referral possibilities are limited only by the imagination of the members
and staff. However, as Friedheim indicated in Exhibit 4246 found earlier in this chapter, referrals are a function
of the level of member activities. The value of a network rests primarily in the members’ hands because they
control the level of activity. There are four referral types ranging from contacting a member firm for
information to a full-scale joint venture.
When the idea of a network is proposed, one of the first thoughts is that the network will produce referrals,
i.e., income. Many see network membership as producing in-bound referrals of clients. Others join networks
to have qualified firms to which they can refer business. They recognize that referring a good client can be
risky. Referring to a network member they know has the least risk.
An example is when a client needs advice in another country; the network can be used to locate a member who
can assist. The member retains the clients and the member in the distant location may obtain business. Network
membership allows the member to assist its clients. The client is not tempted to go to a firm that has a number
of branches. The most simplistic value is to be able to refer the client to a competent professional for
information and possible business. This is a Type 1 referral. It is simple, easily understood, and fundamental.
These basic concepts do not do justice to the power of referrals. It would be like judging a carpenter’s potential
simply by looking at his hammer, saw, and screwdriver. The reason the general members see referrals in these
simplistic terms is because of the geographic perspective of the network. If the only expertise you can access
is based upon location, the “referral to” or “referral from” terminology and concept apply.
245 Sponsors, LEX MUNDI, www.lexmundi.com/lexmundi/sponsors.asp.
246 See supra Chapter 4, Organizing a Traditional Law Firm Network – Exhibit 4.
45
