Is poor-quality CRM data putting firms at risk of losing vital relationship capital?

cross the legal sector, one of the biggest challenges relating to customer relationship management (CRM) software lies in poor data quality, and this impacts every facet of a law firm. With solicitors and support teams busy managing day-to-day client needs, little time is left to update CRM records properly – but the importance of updating and maintaining the CRM with accurate data cannot be overstated. As a result, CRM adoption rates often remain low because teams are unwilling or unable to trust their database.

Studies tell us that 88% of users admit they’ve added incomplete or inaccurate data to contact records. We also know that as much as 91% of CRM data is incomplete or inaccurate and roughly 70% of that data decays annually. And 62% of CRM users across all industries admit they don’t log all activities, making it impossible to track where engagement is lacking, or to identify clients at risk of becoming ignored or disengaged, potentially leading to decreased client satisfaction and churn.

With this kind of data quality, it’s no surprise that CRM projects often fail to generate a return on investment.

For firms today, it has never been more important to ensure that the contact data stored in the CRM is up to date and accurate. As legal services continue to be commoditised, client service excellence is still one of the most effective ways to differentiate yours from other firms – and success is more likely when your firm can quickly access the contact and activity data it needs.

Picture this: you’re a solicitor providing corporate tax advice to a large client. There have recently been changes within the client’s organisational structure, and while you’re well aware of this, you’ve not yet updated the CRM accordingly. There are, after all, too few hours in a day, it seems. Unbeknownst to you, the marketing or business development department of your firm has just pulled a list of contacts and, unfortunately, has out-of-date contact data for an upcoming campaign. Your contact is missed, and the wrong person receives an email that’s not relevant to them – or the email bounces back. If sent to the wrong contact, they could unsubscribe, harming the marketing department’s email success, and bounce-backs further negatively impact the ability to send future communications. In addition, the firm now looks disorganised to a major client.

Protecting relationships, reputation and productivity
Poor data quality makes it nearly impossible for marketing or business development teams to manage lists, and creates confusion for client account teams who need the right contact information or to view real-time activity.

As we all continue to manage the impacts of Covid-19, law firms are struggling to maintain and protect relationships as a growing number of contacts are lost, the result of corporate restructures designed to drive short-term cost reductions for organisations around the world. Losing a point of contact at a prospect or client account can lead to long-term problems, ranging from client dissatisfaction, to a reduction in matters or, even worse, losing the relationship. Furthermore, if your firm has enacted furloughs or restructured itself, it’s possible you’ve lost even more relationship capital with your client base.

In a recent report, PwC said that relationship capital is simultaneously a business’s most valuable asset and the least valued, visible and managed. In spite of the fact that the business and practice of law is built on a foundation of relationships, relationship capital is easily and often forgotten – particularly as it relates to the value chain of the firm as a whole. While individual solicitors are certainly careful to manage their client contacts, the firm needs the ability to measure and maintain this relationship capital across the board.

When firms are relying on inaccurate or incomplete information, another cost is lost productivity as solicitors hunt down relevant information that should have been readily available in the CRM.

However, one way they can improve both CRM adoption and data quality is through the use of artificial intelligence and automation, reducing the burden of manual data entry and removing human error. Introhive, for example, sits in the space between a firm’s email exchange and CRM to collect information passively and sync contacts and activities automatically. This ensures a complete and accurate database, while freeing up valuable time for people to spend on more productive tasks that benefit clients.

With Introhive’s Cleanse solution, firms can also rest assured that data is kept squeaky clean, thanks to data-enrichment and machine-learning processes running behind the scenes to capture title changes among other key details. Solicitors can prepare for meetings with a ‘pre-meeting digest’, which provides them with relevant information about clients to save time spent searching for that information.

As 2020 comes to a close, and firms begin thinking about their 2021 success roadmaps, understanding the technologies that can support their relationships will be an integral part of the planning process. By leveraging these technologies and using AI and automation, firms can protect their relationship capital and – better still – grow that asset in the coming year.