Lawyers’ Greatest Fear: Chaos

The ABA did a survey recently to identify what lawyers were most concerned about in their practices. The (not unsurprising) answer was “chaos” – in other words, a fear that their practice is out of control, and consequently, something terrible might happen to a matter – and to them.

I agree wholeheartedly with the ABA’s conclusion, and was inspired to write an article, which Attorney@Work is publishing as a three-part series. I detail what I see, from my 20+ years of experience working closely with hundreds of firms, are the reasons, and offer some practical solutions.

HERE is the first installment. And by the way, if you’re not a subscriber to Attorney@Work, you should be. A daily dose of good stuff.

Law Firms Are Ostriches, Says Georgetown Law Report

Ostrich ManThe just-released 2016 Report of the State of the Legal Profession from the Georgetown Law Center for the Study of the Legal Profession has some damning words for our supposedly best and brightest. Drawing a comparison to how Kodak went from market domination to crash after missing the market shift from film to digital, the report offers this tasty tidbit:

“The current challenge in the legal market is not that firms are unaware of the threat posed to their current business model. . .Instead, the challenge is that firms are choosing not
to act in response to the threat, even though they are fully aware of its ramifications. . . many law firm partners believe they have an economic model that has served them very well over the years. . .They are consequently reluctant to adopt any changes that could put that traditional business model at risk.

My observation: that’s only half the reason. The other half is that they don’t know what the &$@#* to change it to.

Read the full report HERE.

Fixing the Race to Make Partner

footraceMore firms are having problems finding and retaining good associates. One Atlanta firm, Fisher & Phillips, has gotten proactive about saving their considerable investment in their associates. They have created a new program that lays out the criteria for making partner early in the life of an associate – mainly originating work – then giving them the tools and training to meet those criteria.

“We’re trying to set them up to succeed,” Managing Partner Bert Brannen said In the Atlanta Daily Report story. “It’s a very intentional way to guide people through the evolution from summer clerk to fully functioning first year partner with more business than they can service on their own.”

Attorneys Master Class offers a similar program to its firms. Read about it HERE.

The Fate of the Corner Store Is Coming to Small Firms – Soon

So what did happen to the corner store? The short answer is it became the 7-11, the Circle K – or it went out of business. Most did the latter.

The legal blogosphere is filled with speculation and news about the happenings of biglaw in the legal revolution – but about 63% of lawyers in private practice are in firms of 3 or less. So what’s the future for the little guy?

What if you could suddenly benefit from national advertising – a powerful website – group health and malpractice insurance, and a continuing feed of business that would alleviate your need for marketing?

Sound like joining a big firm? Well, yes – but no.

The legal revolution that has brought about “Alternative Business Structures” offering a range of services beyond legal, and “Non-Lawyer Ownership” of law firms in Australia and Britain are blossoming with creative examples of exactly this revolution. One is a British legal franchise called Quality Solicitors. There are currently over 200 British law firms – some top ones in smaller communities – under the brand.

In Britain, financing for such endeavors is coming from outside the profession. And while that’s not yet permitted in the U.S., it doesn’t have to be for the franchise model. A few wealthy attorneys could fund it. And my bet is that it’s already in the works.

But, you say, “no way – the franchise model has been tried, and hasn’t worked very well.” You’re right – but that’s the past. The world – and technology – has completely changed the game.

LegalZoom has created a no-lawyers model with thousands of fill-in-the-blanks-online forms. They didn’t even need lawyers – although they have since expanded, to capture the market at the next level, of those who really do want to talk to a lawyer. And of course, the web has become the first place a majority of consumers look when choosing a lawyer. So when they Google “lawyer” and see a website that talks candidly about cost, it has their attention. The Quality Solicitors website headline is “When it comes to bills, we don’t like surprises either.”

Then it uses “artificial intelligence” to help the client determine what type of services they need, then puts them in touch with the appropriate attorney in their area. And right there, for the world to see, are prices. Reasonable – and note at the right, with a “clear price” guarantee.

Politics isn’t the only place we’re seeing a consumer revolt. LegalZoom has proven that.

So what can you do to solidify your market position? What can you learn from Quality Solicitors?

First – like it or not, price rules for consumers and small business.
The savvy consumer knows the difference between a straightforward problem or issue and one with a host of “if’s, and’s and buts.” Larger corporations, not yet so much. But even that is changing. Savvy in-house legal counsel increasingly know how to take advantage of a highly competitive marketplace.

The fact is that hourly billing is a relatively new concept that began in earnest in the 1960’s. Before then, most everything was flat-rate priced. (if you want the full story of how that change came about, give me a call.)

So, you’re thinking I’m going to say “flat rate pricing,” but you’re wrong. The answer is actually a sophisticated version of that, called “unit pricing.” Your agreement – and heck, maybe even your advertising (a la Quality Solicitors) has specific “flat rate” prices for stages, or levels, of work, with an open end hourly rate if needed. For instance, in estate planning:

Simple will with components A, B, and C:              $750
Additional if D is needed:                                         $300
Additional if E, F & G are needed                            $900
If H is requested                                                      $1200

Likewise, in litigation, pricing might look like this:

Review of matter, development of strategy,
Filing of initial suit (includes up to five client meetings)                     $3,000 – $5,000
Additional meetings                                                                           $400
Deposition fee (travel billed separately), per deposition, per day     $1000
Trial preparation                                                                                $5,000 – $9,000
Trial, per attorney per day                                                                 $3,000 – $5,000

This is an admittedly simple model with numbers that may not fit for you. But the concept is important. Specific prices for specific, well defined (in writing) types or stages of work. The client should be able to see what they can expect to pay for each stage of the work, and so they can make better decisions based partly on the dollar consequences.

Yes, even when your work is carefully unit-priced, sometimes your time will be more than the fee involved. But you’ll prosper on the law of large numbers rather than on each matter. And after all, what better way to drive innovation and efficiency (which the legal profession has never, until recently, had to deal with) than having to analyze past work to identify better methods or better pricing?

The traditionalist objection to this “cost-based” decision tree for the client is “The client might stop me from doing something important because of cost! They’ll be telling me how to practice law!” Yep, and yep. My answer to that is to yell “IT’S ALWAYS THE CLIENT’S CASE, NOT YOURS!” and to remind the attorney of their first and foremost duty in the client relationship: advice and counsel. If the client decides not to take the advice (which should, needless to say, be documented in a letter or email), then it’s ultimately the client’s decision. How’s that really different than today’s real life?

Second: Make sure your website does its job for you.
What does that mean? First, it means acknowledging that it’s a web world. Even if most of your business is referrals, know that most of those prospects, after they were given your name, went to your website to check you out. So, no website? Really? Then you’re missing out on lots of clients who searched for you, couldn’t find you, and didn’t call. Crappy, creaky 1999 website? Ditto.

So. Give in to the reality that you should pay a design expert to create an impactful, compelling website that attracts viewers to become clients. Because it’s no longer your business card. It’s your front door. Need a referral? Call me.

And if all of your business is referrals, and most people find you on the web by typing in your name (your website statistics can tell you this), maybe that’s all you need.

If most of your business comes from strangers – walk-ins, in traditional terms (remember where your front door is), then make sure your website has all the bells and whistles that make Google light up and want to rank you highly in the listings. This is the first part of what the geeks call “website optimization,” and it’s a job for experts – which doesn’t mean your brother-in law the computer programmer, unless he has at least three recommendations from law firms. There’s a science to picking a web designer who can do both great design and great “organic” optimization. Happy to provide the details. Call me.

Next step – decide where you want to appear on the list when the consumer does a search for “family lawyer” or such. Several options here. You can pay Google to list you at the top of the page, in as many jurisdictions as you can afford.  You can pay a web magician to get you listed at the top of the next group of “unpaid” listings (an arcane and less than perfect art – again, do your due diligence). You can buy a “pay-per-click” ad in the far right column that you only pay for when someone clicks on it to go to your website.

All of this means that, finally, you have to have a marketing budget of reasonable size – 10-15% of your budgeted gross revenues at least. Some for your web works, and some for your other marketing. Many personal injury firms spend far more than this.

Third – do your own marketing.
That means advertising where necessary, and most importantly, personal marketing – building and maintaining relationships with your referral sources – in other words, paying attention to the Parieto Principle – the old 80-20 rule that says 80% of your business will come from 20% or your (you name it – efforts, contacts, expenditures).

The still-true fact is that the best business comes from referrals – other professionals (especially your fellow attorneys), former clients, and personal, social and business contacts. And that’s at all levels, right up to the top of the profession. CEO’s don’t Google “corporate lawyer.” They ask their fellow CEO’s or their CFO or accounting firm for a referral.

And referrals are, by far, the cheapest source of business. So, like it or not, you have to be extremely active with relationship-building. And particularly if you are in a smaller community, you have to be ubiquitous – a “leading citizen,” known and respected by all. Be seen, involved and active in as many places as possible. That in itself won’t make you rich, but turning all of that into a systematic, efficient and results-oriented personal marketing program will. If you need some pointers here, give me a call.

The final truth. . .
Consumer law is going away from the traditional practitioner to the LegalZooms, the RocketLawyers, the franchises, the do-it-yourself forms on the web. The lawyer’s hold on the lower levels of the legal system is slipping fast, as the web offers more and more choices and opportunities. Yes, those choices may not always be the best, but sometimes, the consumer only needs a Kia, not the Bentley we want to sell them. And remember that it’s always the consumer’s choice, not ours.

. . . And the larger solution
Move up the ladder, away from the simple to the more complex work, whether that be corporate or high net worth individuals or successful entrepreneurs, where needs are more complex and nuanced, where matters and their solutions are unique, and where long-term relationships – those “trusted advisor” relationships exist between client and attorney.

Or get ready to buy a franchise.

Here Comes the Revolution – How to Hold On to Your Team Stars

Seven people have passed the exam to be the nation’s first “legal technicians” in Washington state. A quote from the ABA Journal article by Debra Cassens Weiss:

“Washington is the first state with a program to allow limited license legal technicians (LLLT’s)  to help litigants prepare legal documents and provide advice on legal procedures without a lawyer’s supervision.”

And a second story, this time from the ABA itself: Legal technicians may partly own law firms in this state; is ban to nonlawyer ownership crumbling?

The short answer is a resounding YES. The dreaded “ABS” (alternative business structures) which allow non-attorney ownership of law firms, which is already in place in Australia, Great Britain and is coming soon in Canada, has now been breached in Washington State, sans blessing from the ABA.

And if your reaction is “it’ll never catch on,” you’re dead wrong. Oregon is close to following suit. California and New York are considering. Florida is taking a look.

A recent article in the New Jersey Law Journal titled The New World of Outside Investment in Law Firms” has an enlightening comment about the traditional resistance to change – the “law is a profession, not a business” argument:

“There is a hoary battle cry we always hear when having these discussions: “practicing law is a profession, not a business.” That started in the late 19th century when lawyers began to establish a professional identity and adopted the Victorian scheme of professionalism from England. At its core was the tension between the ascendant commercial classes and those who considered themselves better than merchants and above the fray. Many of them practiced law as a gentlemanly profession, but relied on their family money to pay the bills. Few of us today have trust funds. If we don’t bill, we don’t eat. That sounds pretty commercial to me.”

The article also discusses a seminal event – the first law firm in Britain to do an IPO. Well worth reading.

The licensed legal technician trend, like the “nurse practitioner” and “physician assistant” waves that are sweeping the medical profession, is coming to a state near you. And it will affect you in the following ways:

First – unless you’re willing to lose that outstanding paralegal, be prepared to re-think and re-structure how your practice works to keep them – and their revenues – inside the firm. Don’t worry about losing your under-performers. They’ll stay as long as you let them collect a paycheck.

Second – get ready to completely re-imagine and re-design your operations, marketing, client relationships and fees – before your competitors do – to take full advantage of this new category of legal service professionals. Because the toughest of those competitors will. You can implement a good part of this re-design right now on a practical level, before the revolution comes to your town. Frankly, much of the legal profession has been doing this for decades – we’ve just disguised it well.

Third – Get used to not supervising the person who used to be your paralegal. It will be a separate profession with its own standards and procedures. Although in Washington State it is still entwined with the Bar, the state Supreme Court actually created a separate LLLT Board to oversee it. Soon that board will operate in parallel with, and not beneath, the State Bar. Watch for the emergence of a parallel “bar.”

Fourth – expect to find yourself directly competing with one or more LLLT’s. They no longer have to work under the supervision of an attorney. They can – and will – open their own firms. But they will not be admitted to represent clients in court (yet).

Fifth – if you have one or more outstanding paralegals, be prepared to enter into new relationships with them. Many of the best will want to be partners with you – or if not with you, then with another attorney – likely your direct competitor.

Sixth – like it or not, your world is about to change. Read CNN’s commentary The Fall and Rise of Lawyers.

And finally, if you’re worried about your future direction and could use some help drawing a roadmap to your future, call or text me – 407-830-9810 – or shoot me an email – dustin@attorneysmasterclass.com.

 

Do You Have a Pending Website Disaster? Here’s How to Avoid It

Just called up a colleague’s website to find it was trashed with error messages, the result of an unsuccessful attempt to switch IT providers.

Here are some of the most important lessons that I have learned from working with many clients in website development, updates and transitions:

1) If you plan to contract with a provider, first, get the name of the program it is to be developed with. Today, the safest – and most common – program websites are developed in WordPress. If your developer is not using it, move on to one who does. This is the vehicle that makes sure your website it’s completely portable, and your developer can’t hold you hostage.

Second, get a written development agreement that specifies total costs, maintenance costs, hourly rates for changes, and certifies that the website will be 100% portable, with a dollar-specific penalty clause if it proves to be otherwise. It should also specifiy that you own full rights to everything created.

2) Make sure that you own your own domain name. You’d be surprised how many un-techy people hand the whole thing over to a web developer and later discover they are trapped because the developer both owns the domain name and has created a non-portable website.

3) Schedule someone in the office to do a monthly test of every piece of the website, including menu bars, linked documents, contact forms (actually submit a contact form each time to make sure they show up in the appropriate in-box) and out-links.

5) Make a (marketing) schedule to add and manage content on at least a quarterly basis, if not more often. Static websites fall off the search engines; frequent changes keep its ranking up.

6) Think carefully if they’re trying to sell you a blog with the site. If your plan is to post legal stuff, don’t. Nobody but your competitors cares about the legal stuff. Your prospects and clients won’t read it. If your plan is to do articles with daily relevance to your target market – say, senior issues, community issues or business issues, good for you.

But think beyond content to commitment. Blogs are only good marketing when they are constantly fed – ideally weekly, at least every couple of weeks, and you work to build subscribers, or have a regular procedure to push out notifications to a larger list. And unless you are deeply committed, you will almost inevitably stop, or at least slow down, and it will become a burden.

And if you plan to hire a ghost-writer, check with your Bar counsel first. Some Bar associations require that such materials have to be written by the lawyer personally, and labelling someone else’s work as your own is an ethical violation.

Finally, if you’re really committed to a blog, don’t use the web developer’s blog. Most are restrictive and not blogger-friendly. Use a true WordPress blog, either directly at https://wordpress.com/website/ or through one of the facilitators like GoDaddy.com.

So. If the above cautions have you nervous – or if the whole idea of creating – or taking charge of – your website or starting a blog seems daunting, just shoot me an email at dustin@attorneysmasterclass.com or give me a call at 407-830-9810. always happy to share my thought and help however I can.

What if Your Employees Owned Part of Your Firm?

What if your employees sat next to you in shareholder meetings, voting on business decisions about the firm?

big-wave

It’s coming. 

The latest iteration of “alternative business structures” – ABS’s – now permitted in the United Kingdom and Australia, and soon in Canada – is one that will frighten many attorneys: employee ownership of law firms (or the ABS that contains them).

According to the newsletter from LegalFutures.co.uk:

A groundbreaking alternative business structure that last year embraced employee ownership has seen the valuation of its shares rise 15% over the past 12 months. Staff at Triton Global each received a free initial tranche of 145 shares in the company, worth about £500, and nearly two-thirds have since invested further to the collective tune of £58,000. Triton is a multi-disciplinary insurance business combining legal advice, claims administration and loss adjusting. It has 140 staff across five offices in the UK, and a further 35 in seven offices overseas. 

And by the way, guess who’s forging ahead fastest with ABS’s there? The Chartered Accountants, who have thus far authorized 48 – in the last six months alone.

Until the mid-80’s, accountants in the U.S. were among the most conservative of all professions. By ethical rule, it was unethical to give someone a business card unless they specifically asked. Then in the late 80’s the profession went through a re-invention which re-imagined the profession as financial and management advisors to businesses, and spurred the foundation of dozens of consulting firms which collectively took billions out of the pockets of the legal profession.

Will they do it again? Will the leaders of the legal profession – the rule-makers at the national and state level – wait until the accountants skim the cream before surrendering to the inevitable? The profession’s leadership should be fighting hard to evolve the profession in the U.S. like it is evolving in Canada and the rest of the British Empire.

The Big  wave of change is coming. As they say, we can be on it – or under it.

How Do They Get Away With It? U.S. Firm Evades U.S. Non-Lawyer Ownership Rules

Non-lawyer ownership of law firms are still illegal in the U.S. even though they are now permitted in Australia, the United Kingdom and, soon, Canada. So how is a U.S. firm becoming a fully-licensed ABS (alternative business structure)? It seems they do it by putting “UK” after their London firm name.

LegalFutures, the UK-based legal blog, today reported that New York-based Cahill Gordon & Reindel just became the first U.S. firm to do so. (Last week they reported that Jenner & Block was the first but today retracted that.)

Cahill Gordon & Reindel’s ABS will have non-lawyer ownership, making it a true ABS. Their stated purpose is to expand their litigation offerings to clients in the UK and internationally. Why this requires non-lawyer participation in the firm’s ownership is still unexplained.

I have sent a query to the firm for more information. Watch this space.

Jenner & Block Jumps Ahead of the Line in the Legal Revolution

Think the Australian, British and (soon to be) Canadian legal revolution hasn’t hit the U.S. yet? Think again.

Quick recap of what’s happening, straight from the Canadian Bar Futures Report, which generally mirrors the Australian and British models.

The key elements of the revolution all flow from the first recommendation of “multidisciplinary practices” (MDP’s) – firms with business structures “that permit fee-sharing, multidisciplinary practice, and ownership, management, and investment by persons other than lawyers or other regulated legal professionals.” That means, for instance, a firm with lawyers, CPA’s, auto body repair shops and doctors, all under one roof.

From that flows the second element, “alternative business structures” (ABS’s) meaning non-lawyer ownership, or participation in ownership, of law firms. Those CPA’s and doctors and auto mechanics can be part or full owners of a firm.

And the third, “fee-sharing with and referral fees to non-lawyers.” That means the doctor or real estate agent or CPA or whatever can either get a referral fee or even a piece of the overall fee – legally.

So – the British Solicitors Regulation Authority just licensed an ABS consisting of Jenner & Block, a major national ABS based in Scotland, and a mediation service. How did they evade the (rapidly aging) U.S. legal structure strictures?  J&B asserted thar “the office will be operated by “a local independent affiliate, Jenner & Block London LLP” – even though its head of legal practice is dual-qualified Chicago-based partner Timothy J Chorvat.

And a lovely dodge of the issues. According to the article in the British blog Legal Futures, “…the firm would not explain the rationale for becoming an ABS. They would prefer at this time not to reply to your questions. The structure they have chosen for their London operations and their relationship with the SRA are not issues about [which] they wish to engage [with] the media currently.”

Smooth, J&B. And by the way, congratulations. You’re breaking ground for the rest of the profession. My spoof article “Berkshire Hathaway Purchases Omaha’s Largest Law Firm” may not be a spoof for long.

Most Law Firm Websites Suck. How to Decide if Yours Does

Had a revelation about firm websites – I was recently wandering the web looking for good examples as part of developing a client website and just about couldn’t find any. Most are, frankly, terrible. Outdated, stuffy, unattractive, “me” centered or all of the above. It’s amazing how many sophisticated firms, big and small, have websites that were first designed back in the ‘90’s – and look it.
Most firm leaders would huff at my accusation. “It works just fine,” they’d say. But then, it’s hard to measure how many people viewed their site and DIDN’T call.
I’m a marketer. I teach it. I create it. I manage it. And when I see so many of these websites I cringe at the lost potential.
Website designs have evolved dramatically from the early days, for good reason. Better thinking about what’s in the mind of the prospect, how they want information, how people perceive and absorb information, how strong design affects their perception of the strength of the firm, and so on.
A few of the biggest problems I see:

  • Websites designed by website designers, attorneys and administrators instead of marketers.
  • Websites written by website designers, attorneys and administrators instead of marketers.
  • The “all about me” approach. “Ain’t we wonderful” is the theme. Nothing about what drives clients to a firm – understanding of the clients’ industries, problems, goals and frustrations. As Steven Covey so elegantly put it in his vaunted “Seven Habits of Highly Effective People,” “first, seek to understand.” It’s called one of the most valuable business books ever written for a reason.
  • Websites designed in the frontier days of the web.
  • The classified ad approach. Packed with verbiage, these sites try to say everything on their home pages, and are often driven by the deep legal compulsion to couch everything in the most careful legal and ethical terms. The result is a flood of words that pushes readers away.

And there’s more, so much more. Good article from Bloomberg BNA on the subject, “It’s Time to Start Caring About Your Website.”

If you’re brave enough to hear a marketing expert’s unvarnished critique of your website call me. 407-830-9810.

Are You An Excitement Addict? What Is It Costing You?

The wonderful Susan Carter Liebel just posted a great article on the Solo Practice University site about entrepreneurial addiction – people who are serial entrepreneurs and love the creation process better than the implementation process, and get bored with established routine. Such entrepreneurs, inside or outside of the legal profession, are the life blood of a vibrant country.

I want to shine the spotlight on another, more troubling addiction that seems to be rampant in the legal profession. Excitement. It’s an addiction that typically takes a toll on the attorney’s practice, clients, family, and eventually themselves.

And make no mistake, it’s a true, medically-defined addiction. The more accurate term is “adrenaline addiction” because of the fight or flight hormone produced that is designed to speed us up when danger approaches.

A caveat here. A good, committed attorney will usually experience a consistent amount of stress in their daily practice. Being able to function well in stressful situations is a valuable trait. But for some, the stress either accelerates because of lack of understanding of how to manage and grow a practice, or sometimes because, in a real sense, they crave more of it.

The adrenaline-addicted attorney lives constantly on the edge. Always late for meetings and appointments, drives fast everywhere, never has enough time to do any forward planning to avoid the next crisis or to stay out of chaos, so chaos continues to reign. They are often at odds with judges and opposing counsel. They almost invariably have high staff turnover. They drink copious amounts of coffee or caffeine drinks. They cannot be separated from their mobile devices or their e-mail – 24 hours a day.

And tellingly, they also often have high receivables, because they often have poor judgment on client intake, are short on client responsiveness, and never find enough time to follow up on receivables. As a result, difficult, no-pay clients occupy significant time in their practice and their finances, creating yet more chaos. And in another sense, clients who are uncooperative are another chance for exciting conflict.

For the adrenaline addict, order, predictability, and procedural days are not exciting, but chaos and crisis are. Being late for appointments, arriving at the last minute in court, verbal jousting with frustrated clients and opposing counsel are. Even having high receivables is exciting in a negative way. After all, stress is the first cousin to excitement.

Many attorneys who profess frustration and stress about their practice are, unknowingly, excitement addicts.

Some are naturals. A common cause is growing up in an alcoholic family, where constant volatility and unpredictability created an atmosphere of fear and excitement, and a need to be hypervigilant.

And some were simply trained by the legal profession to be so. How does that occur? They may have begun their careers in firms where the workload was so overwhelming that they were always behind, and the management so overbearing that they were always under fire. In this atmosphere, young attorneys come to believe that high stress and constant crisis are normal components of a successful practice. And when they open their own firms or move to a less demanding and stressful position, they unconsciously go about creating the familiar – even though unpleasant – atmosphere.

How does the adrenaline addict feed their addiction? By –
Taking in difficult clients that, at some level they know will be a collections challenge.
Taking too many clients, so that they will always be overworked and under organized.
Not investing sufficient time with cases to strategize, schedule, get the work done, and build strong client relationships.
Not having sufficient support team, or even worse, not effectively utilizing their support team.
Viewing every encounter, from client to opposing counsel to judge, as opponents to be outsmarted and vanquished, rather than collaborators in the legal process.
Drinking 3 or more caffeinated drinks daily
Frequent offensive driving behavior, such as tailgating, speeding or road rage
Constant scheduling of appointments, meetings and events with little down time in-between, and always on-the-go
Frequently causing drama between him or herself and others, or knowingly putting him or herself into stressful situations

And the result?
For the practice –
• An attorney and staff who work long hours inefficiently and at a high level of stress
High staff turnover
High client dissatisfaction and resulting high receivables
Periodic grievances and even occasional malpractice suits
Damaged professional reputation
Financial struggles

For the attorney’s personal life –
Relationship turmoil, alienated children and family
Broken promises
Potential or actual health problems
• Lots of high-risk sports and activities
Other addictions, such as alcohol, gambling
Overspending, credit card debt, impulse buying, financial problems
Lots of toys quickly discarded

If you see a bit of yourself in any of this and want to make it different (and there’s the rub – it’s a hugely difficult addiction to give up), I’ve provided some useful reading below. And I’d be happy to chat about how I might help you change that behavior into others that promote a healthy practice and a healthier life. Give me a call at 407-830-9810.

Some useful reading:
Can You Be Addicted To Entrepreneurship? – Solo Practice University
The ACOA Laundry List of Traits, Trait 8 – Excitement
The Painful Reality of Adrenaline Addiction
How to Overcome Adrenaline Addiction: Tips From A Former Addict
Adrenaline Self Test
Are You Addicted to Your Own Stress?
ADDICTED TO ADRENALINE?

Here We Go Again – The Busy Trap is Stopping Lawyers From Riding the Wave

There is a rising economic wave – yet many lawyers’ practices are full. They’ve suddenly become too busy to grow their practices. I haven’t encountered this since before the crash. Lawyers who a year ago were out hunbig-waveting for business are now hiding out, trying to get their work done, and ignoring their marketing.

Smart lawyers who see the wave coming get out their surfboards. They start asking “how do I need to evolve this practice to take advantage of the rising market?” Dumb ones put on their life jackets and just try to stay afloat. Their mantra is “I’m too busy – I don’t have time to market!”

So, a blunt question: when is the best time to fish? When the pond is dry, or when it’s been re-stocked?

The firms that will survive and prosper are led by forward-thinking managing partners who monitor their attorneys’ workloads and proactively intervene to provide more support, more resources, and practical training on team management. They help attorneys evolve from worker-bee to a true legal CEO.

But the reaction of most firms is to hunker down. “We don’t need more help – it’s too expensive. The harder we work, the more profit we take home.” As a result they burn out their team, increase turnover of good team members, and miss the opportunity for spectacular growth.

Is your firm hunkering down in the face of a growing economy, or is it seeking to ride the wave?

If you’re in hunker down mode and want out, let’s talk. Call me at 407-830-9810.

The One-Stop Shop: Divorce Advice, Face Creams and Sex Therapy

The latest from Britain points the way to a bizarro-world for the legal profession. Britain and Australia have radically liberalised (Brit sp.) their legal systems, allowing alternative business structures (ABS), multi-disciplinary practices and non-lawyer ownership of law firms. Canada is soon to follow – read the full recommendations in “Futures: Transforming the Delivery of Legal Services in Canada”

The latest bounty from the change in Britain: “The Beauty Lawyer,” Cià Gabriella Manes, is offering a smorgasbord of services from DIY divorce advice to anti-aging face creams and, yes, sex therapy.

I made an audacious prediction when Canada released its recommendations. I predicted plaintiff firms with medical facilities and auto repair shops. Now that prediction seems a bit tame.

Read the full story HERE.

 

2015 Report on the State of the Legal Market – It Ain’t Pretty.

The Managing Partner Forum has just released its 2015 Report on the State of the Legal Market. And it’s not pretty. The most salient quotes:

“In the six and a half years since the onset  of the Great Recession, the market for legal services has changed in fundamental – and probably irreversible – ways …the legal market is now awash with new, non-traditional competitors that over time are likely to change the dynamics of the legal services sector in significant ways.”

“The regulatory barriers that for decades have shielded law firms from such competition are collapsing around the world and, even in countries like the United States where formal regulatory constraints remain largely in place, creative “workarounds” are proliferating. Clearly, a much more vibrant and competitive marketplace is emerging.”

“…There is now strong evidence that the U.S. legal market has segmented into discernible categories of highly successful and less successful firms, and that the performance gaps between those categories has been steadily widening.”

The shifting dynamics of the legal services market underscore the critical importance of law firms taking a strategic and long-range view of how their clients, their practices, their markets, and their competitors are changing. . . The resistance to change may also be rooted, ironically, in the very success that the legal industry enjoyed prior to 2008 and, by at least some measures, continues to enjoy today. We may, in other words, be victims of our own success.”

And more…

“Since the collapse in demand in 2009 (when growth hit a negative 5.1% level), demand growth in the market has remained essentially flat to slightly negative.”

“Demand growth in litigation. . . remained negative, as it has been more or less since the recession in 2008.”

“It is increasingly clear that the buying habits of business clients have shifted in a couple of significant ways that have adversely impacted the demand for law firm services.”

“…the major accounting firms again appear to be aggressively pursuing opportunities in the legal sector as well.”

Read the full report HERE

Need some advice on navigating your ship safely to the future? Some directions at http://www.attorneysmasterclass.com/ or http://www.legalceonow.com/ or  http://www.advancedattorneys.com/

A Cautionary Tale for the Small-Firm Lawyer In the Fall of Dewey

An astounding relevation in the article “Judgment Day” about the fall of Dewey LeBoeuf, in the February ABA Journal.

“…Many partners asked a lot of questions about the firm’s accounting in the years leading up to the firm’s demise. They did not always receive complete responses, and the pattern was that the partners would get busy on client matters and not follow through.”

As the X-ers say, OMG. Many of the smartest lawyers on the planet were too busy doing their work that they failed to get a clear picture of how the business was working.

The message for small-firm lawyers is simple. Never get too busy working that you aren’t making sure the business itself is healthy. What does that look like?

  • Tending diligently to your marketing. Making sure you have a strong business network and that new clients show up regularly, and that no client represents more than 25% or your revenues.
  • Managing the income stream: making sure all billable team members are billing at least 3 times their base salary or draw by recording hours diligently and pushing down non-billable work.
  • Making sure billings go out promptly with client-friendly explanations, then maintaining a close eye on receivables
  • Maintaining strong client relationships – not becoming so immersed in “the work” that you ignore the client who brought it.
  • Managing overhead. Reviewing financials (or having a professional do so regularly) to ferret out unnecessary expenses.
  • Being highly selective with client intake, and letting the bad clients and bad work that sneaked in go quickly.

I was recently called into a firm of 5 partners and eight associates to do an operations analysis to discover they had nearly $3.5 million in receivables on the books. Nothing short of catastrophic management from every side: managing new intake, managing billings, managing AR, and managing the attorneys who were (still) creating this mess.

Lawyers were taught the law, not the business, and that too often means they ignore the dull, dry business side they don’t feel comfortable with in favor of the legal side they know. And in doing so, they can kill their practices.

If you’re not willing to be the financial manager, pay a CPA to guide you. If you’re not willing to be the operations and team manager, hire a firm administrator to do so. 

Most small firm attorneys will say “I can’t afford that.” but they can afford to spend sometimes as much as half their time doing the non-billable work of managing the store – and doing it badly – while losing the opportunity to do more billable work and more marketing.

The logic here is counter-intuitive. Spend more money to hire the right people – and end up making far more than the expense, creating a more stable business – and living a less stressed, crazed professional life.

If you need advice on how to turn your ship more directly into the winds of growth, call me at 407-830-9810 or email me at dustin@attorneysmasterclass.com  Always happy to offer my thoughts. 

Read the complete article “Judgment Day” in the February ABA Journal HERE.

You Won’t Need an “Emergency Plan” for Your Practice if You Have A “Growth and Success” Plan In Place

Susan Carter Liebel just posted an article on the Solo Practice University blog – a powerful and meaningful story that every sole practitioner needs to read and heed: “Emergency Planning – Thinking About the Unthinkable.”

But – in my opinion it doesn’t address the underlying issue. The best attorneys don’t need an “emergency plan” because they have built a FIRM with systems, procedures and team members who know – because they’re working on – everything that’s going on – every client, every file. Maybe it’s only one well-qualified paralegal/assistant, or maybe its a sharp associate and several team members. With this, another attorney can walk into the practice and have all the tools necessary to keep it moving and keep clients safe. In fact, even when the attorney is not there – whether for an emergency or a vacation – that good team is taking care of clients and watching over the practice. The solo-solo or the solo with only an untrained clerk don’t have anyone besides themselves who know what’s going on in the practice. They may have lists and stack of files, but most usually all the critical information is in their head.

As Michael Gerber said in “The E-Myth,” if nothing gets done when you’re not present, you don’t have a business – you have a job.” And there’s another issue. The attorney with no team has an absolute limit on his or her firm’s growth, because they have an absolute limit on their time and energy. And their family often has a limit to their tolerance of an absent spouse or parent.

So the greater truth is that the better kind of “emergency plan” is really a plan for growth and success – and the possibility of having a personal life. I just did a 10-minute video titled “The Almost Lone Ranger Syndrome”  that addresses exactly this issue. I just don’t address it as an “emergency plan” issue.

Sams Club Makes Legalzoom a Member Benefit

I predicted the further commoditization of legal services in a recent post, “The “Walmart Lawyer” Has Arrived.” Now Walmart has gone beyond its Canadian experiment with Avvo and rolled out Legalzoom nationwide. Just as I predicted.

This from today’s edition of The Florida Bar News:

“Legal Zoom did more than 1 million wills last year. It’s now a benefit for members of Sam’s Club, whose stores may eventually have lawyers on site. Avvo, which started as a lawyer rating service, now links a potential client to a lawyer every eight seconds and is setting up a service where anyone can speak to a lawyer for 15 minutes, for $39.” Read the full Florida Bar article HERE.

What is the bigger picture here? Bar associations, starting with the ABA, have so badly failed their profession that thousands of lawyers are inevitably – and in many cases, not even gradually – losing their ability to make a living at the law. Bar associations are tragically far behind the curve in serving the needs and interests of their members. The very organizations which used to protect entry to the hallowed portals of the law and keep legal services expensive, are now at the back of the pack, trying to react to the fast-moving world of business.

Futurists such as Richard Susskind in “The End of Lawyers?” and Jordan Furlong, in scores of far-seeing posts on his blog law21.ca (and occasionally myself) have been laying it all out in chapter and verse for years.  And Bar associations have done essentially nothing – at least nothing substantive – to respond. They have been re-arranging deck chairs on the Titanic.

The next big challenge for Bar associations – to which they will fail to rise – is the rising tide of transformation in the profession in Australia, Britain, and soon, Canada – multi-disciplinary practices, non-lawyer ownership of law firms, and more – as outlined the the Canadian Bar Futures Report (an absolute must-read). Bar associations will dither and quibble until the questions become irrelevant, as outside forces take over.

As I and scores of others have predicted, the bottom half of the market for legal services – the “commodity” half (where a great percentage of most attorneys live) is going away, or becoming commoditized to the $39 level now offered by AVVO.

The top half – where legal services are more complex and problems and solutions more unique – can survive, but only by taking dramatic steps to re-invent how they accomplish and deliver their services. For they too are coming under immense pressure from corporate clients who are no longer tolerating the “black hole” approach to billing. Pfizer fired one of the first shots here as early as the mid-2000’s. They announced that they were spending nearly half a billion dollars a year on legal services, and were firing half of their law firms and requiring the rest to provide services on a flat-fee basis. Thousands of companies are following suit.

The solutions? The “legal project management” approach, in whole or in part. As currently taught, it is aimed at mega-matters, and is far too complex for many practitioners (just like much case management software). But focus on internal capacity and efficiency – building strong, efficient and fast-moving teams – is essential to safe navigation of the future, even at the “bespoke” level of the law.

To survive attorneys and law firms must take heed of the principles I put forth in my “Heirarchy of Value of the Attorney In the Practice.”

First and most important – marketing – making sure we have clients to serve. Without clients, the attorney’s skills are irrelevant.
Second – client relationships – making sure the client is being well served (by the team), is happy with the work, speaks well to others about the attorney, and comes back with more work.
Third – Creating the strategy and direction – the roadmap – for the matter. I call this the “wisdom” piece.
Fourth – leading the team to get the result. Leading, not doing it all.
Fifth – the high-level legal work which no team member can do. This hearkens back to the strategy, but also means key client meetings, depositions, hearings, mediations, and trial. This is the neurosurgeon approach. He or she has a team that provides all the initial work, preps the patient for surgery, and often even does the initial opening. The neurosurgeon does only that part of the surgery that no one else can do. And when they’re done they leave the team to close and complete the surgery.

If you’re looking into the face of a rapidly changing marketplace and could use some input, call me. Always happy to offer whatever advice I can. 407-830-9810.

More rants – and more solutions – in coming posts.

Maybe Marketing Isn’t Your Problem!

In many areas of the country, the market is heating up, and when that happens, the biggest danger isn’t necessarily lack of marketing – it’s the fact that attorneys have only so much time and capacity to get the work done – and when they’re on overwhelm, they’re not marketing to capture all the additional work that’s available.  And even worse, they’re not able to deliver the best service to their current clients.

So, marketing isn’t necessarily your biggest obstacle. It might be your CAPACITY AND EFFICIENCY. And how do you increase it?

“Systems, Sorta Systems,”  part four of my video series  “Seven Ways Good Law Firms Lose Money,” discusses how poor systems – or poor use of systems – can seriously hamper a firm’s growth. It’s just 10 minutes long, and it’s worth circulating to every attorney.

The larger issue here is that the profession is moving in the wrong direction – shrinking support rather than increasing it. Steve Jobs didn’t stay in the garage building computers – he assembled a team to do almost everything he was doing, except the most important parts – the ideas and the leadership – what I refer to in the legal profession as the “wisdom” piece. When the attorney is using their time doing work that could be done by an associate, a paralegal or an assistant, they are not operating at their highest value. They have a practical ceiling on how many files and how many hours they can work – and how much time they have to make sure more business comes in.

There is a mistaken belief that technology can substitute for team. Only partly true. The lawyer without a team but with great technology has simply raised their ceiling, not removed it. And in the process they have trapped themselves inside the machine.

As Michael Gerber put it so succinctly in his book “The E-Myth,”  “if no work gets done when you are not present, you don’t have a business – you have a job.”

The path to an unlimited practice is paved not with Ipads and software, but people, systems, procedures – but most of all, great leadership and great management – of which the legal profession is in short supply. Almost every day, I help lawyers expand the

Don’t miss “Systems, Sorta Systems,” or any of the first four parts:

“A Checkbook Mentality”
“Technicians In Charge”
“The Almost Lone Ranger Syndrome”

And of course, call me if I can help Always happy to talk, no charge. 407-830-9810.

The Rising Schizophrenia In Our Profession

Much has been written recently about the increasing gap between the haves and the have-nots in this country. There’s clear evidence that, while the rich are getting richer, the middle-class is increasingly being squeezed, and a large percentage of them are heading for lower middle or even lower class financial status.

It’s the same in our profession. Some attorneys and firms are enjoying boom times, while an increasing percentage are struggling financially. (Read Susan Carter Liebel’s recent post 80% of Americans Can’t Afford Your Legal Fees”). For some the issue is how to cope with overwhelm – that is, how to increase capacity and efficiency, and take maximum advantage of boom times. For others, the issue is, literally, professional survival: how to attract sufficient business to stay afloat.

The solutions for both situations are radically different. But the root issue is the same: attorneys must break out of more traditional thinking and take dramatic and, yes, often risky, steps to change direction.

The “haves” of the profession must literally rethink who and what they are. Most are still stuck in the traditional “technician” role, simply working ever harder as more work comes in. The road out for them is reinventing their role – from “doing it, doing it” to creating, leading, and managing teams. Without this change they are actually limiting their ability to grow even more because they are working at – and usually even beyond – their capacity. These fortunate attorneys have even more work available to them – if they only had time to market and the capacity to handle more work. Where I have helped attorneys evolve from do-er to team leader, dramatic revenue increases have followed.

For much of the rest of the profession – the comfortable middle class and those who are struggling – the issue is more visceral: how to survive and thrive in a dramatically more competitive environment, and one in which the price and value of basic legal services is collapsing.

For them rethinking is about marketing. They must move from “marketing by wandering around” and living in hope to tight and aggressive focus on target markets, and evolving their services from general to more niched and specialized. In effect, they must identify and own specific “small towns” – that is, special interest communities – where they can become highly visible and preeminent. And this tight focus must also incorporate Web, social media and even advertising. But the result is dramatic: stabilized and increased income, and a strong, long-term position as the “go to” attorney in their specific “small towns.”

For both groups, there is a road up and out of their present positions. And for both, it starts with a new answer to the question “who am I as a professional?”

Call me if I can help.

The “Walmart Lawyer” Has Arrived

Back in January 2013 I wrote a post predicting “The Rise of the Walmart Lawyer.”

The rise has begun.

My prediction was that Walmart would contract with young lawyers who would then utilize an online legal document generation program like LegalZoom – and offer advice on which pre-packaged legal documents the consumer needed.

It’s begun in Canada, and not quite the way I predicted. The reality is actually more radical. Axess Law, a new-wave Toronto firm, is now offering “bespoke” legal services from a tiny rented space in the front of several Walmart stores in the Toronto area, with an eye to expansion. And they’re actually using their own proprietary documents and software akin to LegalZoom, more Canada-specific, and not quite so “canned” as LegalZoom

What makes them different?

Price, of course. Simple wills $99, notary services $25. And a carefully limited range of services. More complex work is referred out.

Business model: volume. The traditional law firm model was based on scarcity, which no longer exists – one of the reasons the profession is in trouble.

Accessibility: drop-by and drop-in service, no appointment necessary. Hours – 7 days a week, 8 a.m. to 8 p.m. They say that the hours of 5-8 are their busiest – just when other legal offices are closed.

How are you changing to deal with the future? If you provide a “commodity” level of services, you are in danger. If Walmart does it, are Target, Kohls, Kroger, Walgreens and CVS – in partnership with hundreds of other new-form law firms –  far behind? You need to read the full article. It’s one of the waves of the future – but not the only one.

If you’re worried about your future – contact me. Let’s talk.

 

A Curmudgeon’s View of Social Media Marketing

Just sent the Ohio Bar my handout for a marketing track at their upcoming Solo-Small Firm Conference in December. They liked my section on social media marketing so much they posted it as an article in their e-newsletter. Might be worth a read: http://bit.ly/1uwlpz

Also – premiering a new division of Attorneys Master Class – LegalCEOnow.com. Take a look around. Make sure you look at my short video series “Seven Ways Good Law Firms Lose Money” – http://www.legalceonow.com/adminutes.html

Partner Compensation: Start Making Sense – A Riposte

Jordan Furlong just posted another thoughtful and perceptive Law21 blog post on law firm compensation that is worth your attention: Partner Compensation: Start Making Sense. Jordan is one of the profession’s deepest thinkers and most accurate futurists, and writes what is consistently one of the top 100 legal blogs and my personal favorite. I suggest you read it first, then come back here for my counterpoint. He and I most often agree on the principles, but not always on the details.

Jordan’s observation is dead on that compensation is the “third rail” and one of the fundamental reason why law firms are failing, splintering, and going through hugely disruptive times. They are failing because of inordinate and warped compensation structures, splintering because younger partners are increasingly unwilling to finance massive payouts to retiring partners, and experiencing huge disruptions as the more progressive of them attempt to right the boat and survive.

Here are my comments on Jordan’s three points –along with a general agreement on both his approach and philosophy.

1. Stop overvaluing sales.

Yes – this “most highly valued” area of business generation is overvalued, for the reasons Jordan suggests.

His solutions, while in the right direction, contain somewhat of a fatal flaw, which is calculating “profit” on which to measure sales compensation. This introduces a wildcard factor that can destroy the original intent, because profit is a number easily manipulated and subverted.

Rather, I suggest a simpler version. First, I completely agree with his declining compensation concept. But second, a simpler structure – one which is more easily calculable – is in order here: 15% of first-year revenues, 10% of second-year, 5% of third year, and at the fourth-year the client becomes a “house” account with no origination paid. The firm should also delineate the qualified practice areas of all attorneys, and require that work outside the originating attorneys practice areas be moved to a supervising attorney with the appropriate skills, and out of the hands of the originating attorney. This serves the firm’s purposes in diversifying the firm’s contact with the client, and frankly, keeps the unqualified originating attorney from billing inappropriate hours for “supervision” of work outside their expertise.

Jordan cites frequent cases of inordinate sales focus resulting from declining client service after the sale. This, however, is not really a sales issue, but a management one. Frankly, the biggest obstacle to an attorney developing a larger book is their ability – let me restate that – their skills and willingness – to manage work effectively. Most lawyers are either good technicians or good salespeople, but rarely good managers. This problem is exacerbated by the general trend of law firms to decrease leverage, which drives work that should be done at lower levels up to the attorney, and thus decreases their capacity to handle more matters. And an attorney who is already overwhelmed is not keen to increase their marketing.

There is a larger issue here as well: how the overall firm is operated. The medieval “guild” foundations of the profession create a curious and dangerous dichotomy: my clients are my clients to manage as I wish, but I deserve a big share of the overall profits of the firm.

The fact is that, in most firms other than mega firms, the originating attorney “owns” the client, and has complete control over their management, from indifferent client service to allowing receivables to languish.

As Jordan recommends, the firm should be “taking the temperature” of clients regularly, and the very issue of continued partnership should rest on the attorney’s commitment to high level of client service and satisfaction. In this respect, firms should be actively and aggressively training attorneys to be strong team leaders and managers as well as good salespeople and technicians. And as a corollary to this, firm should be building strong support teams around their strong salespeople, which dramatically increases their capacity to oversee (and thus originate) work. This is a concept which goes against the grain of the current trend in law firm structures and is, in my opinion one of the most short-sighted issues in law firms today. But it points directly to most law firms’ inability to create good managers or good management structures.

And finally, the firm, not the attorney, should own the receivables and manage them appropriately, and the firm should be primarily responsible for making sure a high level of client service is delivered.

2. Start properly valuing everything else.

The issues Jordan enumerates for valuing other elements of the practice are certainly valid. But most of these issues are difficult to quantify other than subjectively, which often assures that no one feels treated fairly. And those that are quantifiable create a considerable overhead burden, as well as much room for argument and discussion.

Yes, firms should value client relations, as measured by client surveys, and project management, as measured by timelines and budgets. Again, these fall into my belief in us of more objective measurements.

Legal marketing, however, is compensated through results – that is, originations – and need not be additionally valued. However, firms should provide marketing budgets and better, more practical staff support. Too often, firms hire marketing people who focus on big issues of branding and image, while failing to support the practical, “boots on the ground” efforts of the individual attorneys which actually generates most of the business.

Leadership activity is already measured and compensated by stipends for service at various levels of management. In fact, firms that fail to do so are insuring that those roles will be marginally exercised, resented, and badly managed. Smart firms not only provide stipends for management responsibilities, but consequent offsets of billable hour requirements.

Recruitment efforts should generally be outside the normal purview of the working attorney, and vested in, for instance a recruitment partner, who is compensated for this management role. There could well be some space to provide some type of “finder fee” for an attorney who refers in a successful candidate. The issue of longevity of that hire as a factor for that compensation isn’t valid, since it is largely outside the control of the finder, and too dependent on political and financial decisions of firm leadership.

Community support and participation, while almost an ethical requirement of attorneys, is really of two types. The first is the contribution of services – pro bono work or work donated to charitable and community organizations – and the second is community participation and leadership. While the first is somewhat quantifiable, the second is a hybrid of personal commitments and marketing.

Permit me a tangent here. One of the biggest failings of most law firms is inadequate recognition that each attorney has certain strengths and weaknesses, and brings specific values to the firm. Most firms expect all attorneys to fall into a single pattern – good sales skills and good technical skills. And in fact, offers of partnership are most often tied directly to originations.

Often, good “sales” people are bad managers (and sometimes even not such great lawyers), and should be required to utilize a strong “client care” team to deliver services and legal work.

Conversely, every firm needs, and should appropriately value, those who are good technicians, and therefore support the good salespeople in delivering service, but who are not good salespeople themselves. The best firms have the appropriate mix of both and the right structures to make it work. Great teams behind great salespeople create a very large funnel of work, revenue, and profit.

3. Stop paying partners to bill hours.

Jordan’s observation on the baffling partnership structure is dead center. Back in the 1990s large firms were experiencing a disturbing trend: associates were leaving large firms at an alarming rate. While the theory was that partnership was a reward, associates saw partners under more pressure and stress, rather than less. A Wall Street Journal article quoted one associate as saying that the competition for partnership was “a pie eating contest, the reward for which is more pie.”

Why this still exists is a complex problem, but one that stems from the fact that most attorneys still see themselves as technicians, not managers, and insist on staying on as players, long past the point that they should have been moved to coaching.

There are virtually no successful companies where the owners and founders are still on the assembly line making widgets. In the business world, the successful entrepreneur moves from inventor to technician to manager to leader, and eventually to passive owner or shareholder.

The foundation of this problem is laid in law school, which typically teaches two principles. First, just do great work and the clients will come: and second, you’re a professional and not a business person. Consequently, lawyers have no desire to become managers, and indeed, see it as abandoning their profession, and thus their identities. In other words, their identity is tied up with the work itself, rather than the business that does that work. In many firms, the person elected managing partner is the person who was not present at the partner meeting to refuse.

Too many firms perpetuate this approach and this model by undercompensating their leaders and burdening them with onerous “technician” requirements for billable hours. Just four years ago, I encountered a managing partner of a 55-attorney office of one of the top 20 largest law firms who was paid $50,000 for the role, while still required to bill at least $600,000 – and given the support of half an assistant to support him in fulfilling both roles.

Final observation. The revolution that has already come to Britain and Australia and will shortly come to Canada (www.CBA futures.org – a must-read) will, sooner than anyone expects, come to the United States. And when venture capitalists, investors, and strong business leaders begin to transform the profession, much, if not all of this, will change. Big firms will fall and splinter and merge like never before. Smaller firms with onerous partnership and buyout terms will disintegrate, leaving those senior partners expecting big payoffs looking at empty firm checkbooks. And many attorneys will find their expected career paths vaporizing. My last tongue-in-cheek blog post, “Berkshire Hathaway Purchases Nebraska’s Largest Law Firm” isn’t fantasy, but simply a news article ahead of its time.

Berkshire Hathaway Purchases Nebraska’s Largest Law Firm

Omaha, Nebraska, June 22, 2019 – Just weeks after passage of the highly controversial American Bar Rules Reform Act, Warren Buffet, widely considered to be the nation’s most savvy investor, made a surprise announcement of the $28.6 million purchase of his company’s primary legal counsel, the Omaha firm of Barnhart, Short & Andressen, which has nearly 100 attorneys and five offices in three states.

Buffett issued an unusually detailed statement concerning his future plans. “The legal profession has historically been the last of the “guild” professions, and has until now managed to resist consolidation. We see an immense opportunity to modernize the delivery of legal services with operational, management and functional changes, and ‘consumerize’ the delivery of a host of legal and other professional services at both the individual and business levels.”

The Berkshire Hathaway announcement is widely seen as the first shot in a major restructuring of the legal profession facilitated by the surprise passage of the 2019 American Bar Rules Reform Act. That Act generally followed the 2016 Canadian legislation resulting from a 2014 Report, “Futures: Transforming The Delivery Of Legal Services In Canada.”

The Canadian legislation itself was closely patterned after Britain’s 2007 Legal Services Act, which legalized non-attorney ownership of law firms and so-called “multi-disciplinary practices,” meaning a single entity which delivers a variety of services such as legal, accounting and medical under one roof. Passage of the British and Canadian legislation engendered an unanticipated major economic upswing that attracted the attention of U.S. investors and legal entrepreneurs, who led the sometimes bloody three-year fight in Congress for the bill’s passage.

The unexpected announcement from Berkshire Hathaway echoes the company’s 2014 purchase of a major auto dealership group, and the subsequent major consolidation of the new-automobile sales marketplace. Today Berkshire Hathaway controls nearly 30% of the automobile dealerships in the U.S., having driven more than 600 independent dealers out of business.

Editor’s Note: We welcome your comments. Click on the comment balloon to right of headline.

The Biggest Mistake New Lawyers Make

Kudos to my old friend Nerino Petro and his co-author Jocelyn Frazer for the tour-de-force article “The GPSolo Guide to Opening a Law Office,” in the Jan-Feb GPSolo Magazine. As always, information-packed and extremely valuable.

Except for the missing piece. How does the new lawyer attract the business that will feed them?

The mistake looks like this: “I wanna practice criminal defense.” Or maybe “I wanna practice personal injury” or “I wanna practice estate planning.”

It’s lovely that they wanna practice whatever. But the more relevant question is – how can they create a successful practice? Too many new lawyers set up an “Iwanna” practice without a careful look at the market, and end up driving a cab.

The basic question is – who are you going to sell your services to, and what are you going to sell? The traditional approach is “whatever I can to whoever will buy.” that makes them a snowflake in a sandstorm.

In my workshops and in working with my individual clients, I assert that the secret of success in today’s chaotic marketplace is “niche and target market.” In other words, the most successful attorneys identify a target market – hopefully one that isn’t already owned by other attorneys – and identify the needs of that market. And they market themselves and their services in a manner designed to clearly create a distinction between themselves and others. In the (paraphrased) words of a groundbreaking book from way back in the 70’s titled “Positioning: the Battle for your Mind” the game is to identify a position – a distinction or uniqueness – in your prospect’s mind that is not already occupied – or in today’s world not crowded – then own that position (niche).

So, to get started in your practice in the most powerful way ,start out by identifying a group that you can get your arms around. A target market with clear boundaries and marketing avenues. For instance, I helped a client in Chicago whose ethnic background is Serbian to identify the (painfully obvious) target market for her, and then helped her own it. She is now the “go-to” lawyer for a community of over 35,000 people. A small town that is plenty big enough to keep her busy – and successful.

So what does this look like for the brand new attorney? It begins with some serious due diligence. First, a detailed study of the demographics of your area. What specific religious, ethnic, professional, business, social or other groups – that is, potential target markets – are present in your area? There is an unending list in most cities: Christian, Muslim, Brazilian, French, Sportsmen, preservationists, union members, farmers, truck drivers, square dancers, Kiwanis members, college and law school alumni associations, opera society members, and so on, ad infinitum. Second, identify a significant target market which which you have some connection or affinity. Are you Italian-American, classic car enthusiast, triathlete or birdwatcher? Third, get seriously involved and connected.

Why? Because of some basic human psychology. Who do we like? People who are like us. So, even if you’re a stranger, once you step into a group of people who share something, you are immediately a friend – and that means someone they trust more than they would trust a stranger.

And it’s also because of another factor. Consumers in general have no way of deciding whether you are a good attorney or not. Instead, they will tend to make their buying decision on instinct. “Really liked her.” “felt good about him.” Now, if they’re sophisticated buyers of legal services it’s different. But in general, your first step in getting business is connecting with people who have a reason to like and trust you.

Next, you want to make sure they know you’re a lawyer – not by “selling,” but by storytelling. Everyone gives you the opportunity to educate them – they say “haven’t seen you in a while – what’s new with you?” or the like. The perfect opportunity to relate a story about some interesting legal problem or opportunity you’re helping someone with. And in the process accomplish what I refer to as “under the radar” education. Often the result of one of these stories is the response of “gee, I didn’t know you did that!”

Then – and this is where my usual advice differs – you want to position yourself as the “trusted advisor” rather than the estate planner or criminal defense lawyer or whatever. This is the advice I usually give to my clients in small towns. You need to position yourself as the “go-to” person that people reach out to first when they have a problem, giving you the opportunity to either help them directly or advise them on where to get help. So, in small towns the lawyer can still specialize – but they have to be the first one people call for anything, so they can take what fits, and also maintain their “go-to” image by advising them on where to go for the help they need. And by the way, that puts them in a powerful position of referring business to others – and building a refer-back network.

So, even if you’re in Chicago, when you’re with your affinity group you’re essentially in a small town. And you need to develop the “go-to” reputation just as though you were in Beemer, Nebraska.(And I actually have a client there – one who will, with my support, within a few short years essentially own the Nebraska farm family “affinity group.”)

So, this new position you’re developing as the “go-to” lawyer in your affinity group allows you to, early on in your career, not only develop business more effectively, but also begin to focus your practice. As your profile grows and more people come to you for help, you can become choosier on what you take and what you refer out. And, as your practice takes flight, you can now expand into other target markets or focus on building a more public presence, attracting a wider audience.

And from another point of view, it’s a chance to connect with people you like – people who are like you – and develop your practice in a far more enjoyable way. Maybe this won’t be your forever market, but it will be a powerful way to get started.

So, don’t make the mistake too many young lawyers make: marketing by wandering around. Find your affinity group. Get involved, get high profile by taking a leadership role – and attract business from people you like.

Is Your Social Media Too Social?

Bad news for many of you who have dived whole-hog into social media for marketing, from a recent Wall Street Journal article:

“Businesses are looking more critically at social media and its influence on the bottom line. A majority of respondents in a Gallup survey said that social media had no influence at all on purchasing decisions.”

Another study quoted in the article says that consumers trusted a whole laundry list of other advertising more than that in social media.

Ta-da-boom. So how well have your prodigious efforts with social media worked? How much new business has it generated? At the end of the business day, that’s all that counts. That’s the only relevant payoff. “Likes” only count in, er, horseshoes or something.

Another snippet from the article: “Fans and follower counts are over. Now it’s about what is social doing for you and real business objectives,” says Jan Rezab, chief executive of Socialbakers AS, a social-media metrics company based in Prague.

Not that far – in fact danged close – to what I have been saying for years in CLE programs and to clients about personal marketing, and about social media. It’s about the relationship, stupid. And that’s my basic rule #1 of social media: it’s not about the body count. 

Here’s a personal experience I had with a LinkedIn group. I’m a member of several groups of small firms & solos, practice management, et cetera. I got a notification of a new post in a practice management site which turned out to be an announcement to the world of some firm adding a practice area. Blatant publicity, no value delivered to the members of the group. And, being the cantankerous and obstreperous soul that I am, I responded with an acid put-down for, essentially, violating an implicit trust relationship. Were they relationship-building? Hardly.

This happens millions of times every day across social media. And this blunderbuss approach is exactly what’s creating the large and growing disenchantment and incredulity.
So here’s my basic rule #2 of social media: talk smart. Always say something that others will be interested in, or find helpful or valuable. It’s about creating trust and respect. Have you ever looked for comments from a particular person on a group thread because they always seem to have valuable insights or suggestions?

Now, that said, of course when I comment I always try to slide in some subtle plugs for my marketing and practice operations advisory services, or retreat facilitation or succession and transition planning support (kinda like that) when I post an article or a comment. But I always do it inside the communication of some information that I sincerely believe will be of value or help to my readers. Like this.

And here’s my basic rule #3 of social media: “Get closer.” Seek to draw people closer in relationship. Respond to people making positive or thoughtful comments on your posts or those of others. Don’t be the web equivalent of the guy or gal working the room – the one everyone sees coming and tries to avoid. Be the one they want – and like – to communicate with. Just like in real life.

Interesting factlet: the rise of social media has created a mini-boom in the printing of personal note cards.

Really? Old-fashioned paper delivered by snail mail? How primitive, yes. But how personal, how sincere. Think about it. How long does even the most laudatory e-mail stay on your desktop? 30 seconds? A minute? And how about that handwritten, hand-stamped note card? Days, maybe even weeks.

So, your social media work should have a “get closer” strategy. Put out valuable, insightful, thought-provoking information designed to encourage dialog. When that dialog occurs, respond to the respondents. Try to create a stronger relationship with the relatively few who engage.Make the conversations as two-way as possible.  And aim for moving the conversation beyond the social media stream, toward a direct e-mail conversation, or – heaven help us – an actual phone conversation. Because if you’re trolling for clients – or even referral sources – out there, eventually it should entail an actual direct conversation of some type.

The old referral marketing adage still applies, even here. To attract clients – or referral sources – you have to build —

Know – they have to know you exist, and know what you do

Like – they have to feel in some way positive about you. Your posts have to have the flavor of someone they’d like to talk with, not someone who sounds superior or overly critical or negative. It’s just human nature.

and Trust – the social media communication has to create some level of trust that you know what you’re doing.

Next, how much time are you spending on social media, and exactly how many prospects is it generating? My basic social media rule #4 is “measure it.” Measure it backwards and forwards and sideways. How much time are you spending? Where? What sites or activities are generating the most interaction – comments, responses, challenges? How many prospect inquiries are you receiving by e-mail or website inquiry or – heaven help us – by phone? Do you have a process in place to track activity, responses, interactions, prospect contacts, and signups? The concept of continuous improvement, or statistical quality control (“kaizen” – what Toyota and a good portion of the Japanese economy runs on) contains a core principle: you can’t manage what you can’t measure.

Finally, my basic social media rule #5: Make a budget. No, not a dollar budget (at least not for social media) but a time budget. Because social media can be addictive. We can spend far more time than we planned in wandering about the web seeking to see and be seen. So use your kaizen to identify where to focus, how to focus, and when. Use your time wisely and with focus and purpose. As I always say in my marketing seminars, stop doing “MBWA” – marketing by wandering around.

So here’s the full WSJ article that got my motor running. If you’d like my thoughts on marketing that works, dig around my blog here, or go to my website,  or just call me at 407-830-9810.

Yeah. Call. Don’t e-mail or text or find me on LinkedIn. Just call. Remember – it’s all about the relationship.

Why You Need a “Lie Detector for Your Email”

The Wall Street Journal today had a much-needed article – take it as a warning – about how to, as the sub-head said, “read between the lines” to spot lies in your e-mails.

The scary part is that we need this training. We really need it.

The article reflects what I’ve been saying for years in my CLE programs: 80% of communication is non-verbal. Digital communications are convenient, but by their nature, incomplete. Some choice bits from the article:

“Experts say that the vast majority of our interpersonal communications involves body language – gestures, facial expressions, tone of voice. Take these intangibles away, as we do with digital messages, and we are left with far fewer clues as to what is really going on.”

And here’s an especially juicy one: “Research shows people tend to be suspicious of information they receive online but override their suspicions and trust the information anyway.”

Whew. Even lawyers? The original paranoids? Yes. Unfortunately.

Missing from the article was information from earlier studies that have shown people are more willing to lie, tell half-truths and obfuscate in emails or text messages. Even people who wouldn’t do it to your face.

My urgent advice:

First, when you have a client who ONLY wants to communicate by email, and won’t talk to you in person or on the phone, be suspicious. Very, very suspicious. And expect some difficult – and too often messy – surprises.

Second, simplify your digital communications to avoid humor, sarcasm, implications – in other words, reduce your communications level to that you’d use with a 5-year-old. Simple. Facts. No chat.

Third, read it over before you send it to see if there is anything that might be misconstrued.

Fourth, never – let me repeat that – NEVER – give anything that could be construed as legal advice in a text message. Your clients pay you not just for your legal skills but your “careful and thoughtful consideration” of every aspect of their matter. And text messages encourage reactive thinking. So, while I suggest (in vain) that attorneys do not communicate with clients via text messages, at least consciously keep it to non-legal, purely procedural stuff like confirming a meeting. Never express an opinion in a text message.

Fifth, always have your radar up with all incoming communications. Expect that there will be incomplete communications, intentional or unintentional obfuscations, half-truths, omissions. Expect that they and you will likely misinterpret something somewhere.

And finally, whenever you feel uncomfortable, unclear, confused with any incoming communication, seek deeper communication. Pick up the phone. Meet with them personally if possible. Because if email communications aren’t sufficiently communicating everything to both sides, more email isn’t likely to help. Eyeballs work best, voices are the next best choice.

Remember that for some clients, a grievance or malpractice suit is an easy answer. But it won’t be for you. You need to arm yourself against a problem you may not sufficiently understand. So read the whole article. And heed its – and my – advice.

PI Attorneys: the Revolution is Upon Us

The revolution I have been predicting for years is upon us, led by the nation’s largest personal injury firm, with 270 attorneys, based here in Orlando, but with tentacles across the nation.
An article in the May 16 Orlando Sentinel reads as follows:
“John Morgan, founder of Morgan and Morgan, is expanding the firm’s focus on commercial contingency litigation – taking a case in which a business is suing another business but only getting paid by the client if that client wins.”
And if you think it’s a tentative commitment, think again. “Morgan said he’s planning to add fifty lawyers in the commercial trial area over the next five years.”
Why? For several reasons. First, he is seeing personal injury work declining due to greater regulation and legislation. “A few years ago, nursing home cases were 20% of our business, but that’s down to 1% now.”
Second, because auto accident cases are dropping due to technology that is making cars safer.
Third, my issue, which he doesn’t mention, is the tide of young attorneys coming into the PI marketplace willing to take most anything, discount their fees, and too often spend big dollars on advertising. Then often go out of business.
I work with personal injury firms around the country to help them make their operations more efficient and their marketing more productive. But in every case, I see the train a-comin’. In some areas it’s a long way off, but in others such as Orlando and Miami and Atlanta and Chicago and Boston and New York, it’s already in the station. Firms are spending more and more on advertising and getting less and less in return. The pie is indeed shrinking – or at least, getting harder to cut – while those trying to cut themselves a piece are wall-to-wall.
The game is changing. Contingency commercial litigation is a relatively new animal with huge potential, and the smartest firms will follow Morgan’s lead – ahead of the crowd. It doesn’t mean that you stop what you’re doing and switch, only that you start investing your current profits into creation of a new department, and the development of a new market profile. In fact, I’m helping several firms do this as we speak. Call me if I can help.

You’re Losing Money Big Time.

The average law firm is incredibly inefficient and wasteful. Why? Because they make too much profit. If that sounds crazy, let me explain.

ABA and bar association statistics say that the average sole practitioner/small firm profit margin is between 45 and 55%.  Contrast that to the average grocery store margin of one or two percent. With such a razor-thin margin, grocery stores are constantly focusing on efficiency, profitability, increasing sales, increasing customer loyalty – everything to make sure that slender profit margin doesn’t turn to a loss.

Law firms, not surprisingly, generally operate on slop. A few unbilled hours here, a few uncollected dollars there, a little staff inefficiency, little extra expense for services, and, as former president Lyndon Johnson used to say, “a few billion here, a few billion there, pretty soon it adds up to real money.”

(Do you know how to calculate your TRUE profit margin? Ask me.)

Before we get to the details, let me share a few big principles.

First: if you want to grow your practice, first you have to be willing to grow your skills in managing it.

It hardly needs to be said. Attorneys hate to deal with the “business” side of the business. Most suffer from the “I just want to do my work” syndrome. Staffing, firm administration, expense management, accounting, all take a major back seat to “getting my work done.” As a result, attorneys tend to live in a highly disfunctional business environment.

Becoming a better manager starts with the attorney himself or herself. Personal efficiency, organization, productivity. The ability to focus and get things done. Next, they need to know how to create and manage an efficient team. Develop the right team and the right team structure, and build an effective system for delegating, supervising, and managing.

Second: doing legal work is not the primary purpose of your practice. Altruism and idealism aside, the first purpose of the practice is to allow you to have a decent life. If it doesn’t do that, your ability to take the best care of your clients is endangered. Delivering legal service is your product – how you accomplish that primary goal. If you find that offensive, try working the next year for free and see how that works for you.

Third: your most important role in the practice is not doing your legal work. It’s making sure there is legal work for you to do. Marketing. Sorry, all you idealists and ethicists. And by the way, personal marketing has always been ethical. Sales and solicitation are not.

Fourth: most attorneys have never been trained (or have wanted to be trained) in good business practices. Enough said.

Fifth: any change is uncomfortable. Many great changes have been avoided or discarded because the initial process of change proved uncomfortable. As Arnold Palmer once said, “in order to play golf well, first you have to be willing to play it badly.”

Over the next weeks, I’ll offer my thoughts and advice on the following areas:

How to build more powerful initial prospect conversations. The easiest place to start in getting new clients is in increasing the percentage of your prospects who become clients. We’ll talk about how to create the most powerful impressions and communications so that more prospects hire you. Conversely, will examine why and when to say “no.”

How to create stronger initial client relationships. Most clients leave your office without any clear picture of what will happen from then on. In other words, and some level of fear. What are the keys to ensuring a better ongoing client relationship?

How to reduce your accounts receivable through better client communications. More than 55% of all attorney grievances relate to poor communications. What must you do to make sure that the relationship stays afloat and doesn’t crash and burn?

Happy clients mean happy receivables. How do you get there consistently?.

How to increase the efficiency and work quality of your team. Do you have the right team? Are they all working as efficiently as possible? Are you managing them effectively?

How to expand your client base without significant cost. The most successful attorneys are masters at developing a strong base of referrals, and a powerful public reputation. You can be too.

Stay tuned.

15 Minutes of Silence: Can You Do It?

A recent article in the Wall Street Journal posed a critical question worth considering.
A CEO of a highly successful company was challenged by a friend to sit still for 15 minutes in complete silence and inactivity. And he bet him $15,000 that he couldn’t do it.
And he couldn’t. “I never expected it to be so hard,” he said. “I found myself reaching for my Blackberry every minute. I couldn’t shut down.”
Could you? And why does it matter anyway?
Our technology has changed the very fabric of our lives and relationships. At the core, we have given everyone else the ability to control our time – to interrupt and become our immediate priority no matter what else is going on at the moment. And worse – we’ve become addicted to it. We crave it, just like the CEO.
Again – so why does that matter?
Because of the hundreds of studies on focus and concentration that universally agree: when we are frequently interrupted, our efficiency and productivity drop, and our ability to deliver quality work is compromised. Most lawyers don’t have five minutes without an interruption by their technology, their staff – or their own ADD thoughts – no less 15.
And for lawyers whose time is their treasure and their reputation is everything, decreased efficiency and quality issues are life and career-threatening.
Not that lawyers are turning out poor quality work. It’s just that it is taking them longer to deliver that quality.
Is it no wonder that the average lawyer is spending 50, 60, 70, even 80 hours “at work,” whether that be in the office, in the car, at home or on vacation (ever spent a vacation in your hotel room working?).  Technology isn’t the only culprit. Lawyers are notorious for having no personal boundaries and working constantly. Technology is simply making that spectacularly worse.
Most lawyers, when challenged about allowing technology to control them, will respond with “but my clients expect me to be available to them!”
Sure. Because you told them you would. Or worse, because you didn’t tell them anything about how you would work together – so they got to decide for themselves.
Here’s a communication I strongly suggest you use with your next new client:
“One of the most important things you have hired me for is my wisdom and my careful consideration of every aspect of your matter. For that reason, I have taken several steps to insure that I can always deliver that.
First, I have set aside time during my day, from — to —, when I am uninterruptible except for emergencies, so that I can focus on my work for you and others, and provide my best service. So if you call during that time, you may speak with my [associate /paralegal/assistant], or you can leave a message for me, and I will respond within 24 hours.
Second, I do not respond immediately to e-mails, because I want to carefully consider any question or information you may offer. Instead, I review my e-mails periodically, and respond carefully.
And third, I do not text, because texting encourages reactive responses, and that violates my principle of thoughtful and careful consideration.”
Basic principle here. Your time is your treasure. If you don’t take control of it, everyone else will. And if they do, you’ll be working at night, on the weekends, and in your hotel room while the kids are at Disney.
Radical. Retro. But it could save your life, your practice, maybe even your marriage.
Oh. And by the way, here’s the link to the article. I didn’t offer it up front because I knew – A.D.D. you – that you’d follow that shiny thing even before you read the article.

Are We Multitasking Our Ethics?

Hope you read that great article in the September/October issue of Law Practice – “Churn That Bill, Baby! Overbilling in Law Firms.”  It brought to mind another looming problem of ethics and integrity that has gone virtually unnoticed in the profession.

I spend approximately 4-6 hours each day on the phone in my role as practice advisor to my various attorney clients around the country. As such, it’s important for me to be highly attuned to vocal clues which tell me where my client is mentally – tired, depressed, excited and energetic, reluctant, inattentive. Each nuance immediately affects the vector of our conversation for that day. At the beginning of each call, I actually close my eyes so that I can be totally focused on “reading” where my client is for our call.

And increasingly I have noticed one particular tendency – “distracted.” When I query, the answer is, almost always, something like “oh, I was just reading an e-mail,” or “I just got a text from my [son, wife, client] and had to respond.”

For too long I have dismissed it as “just the usual” because attorneys are notoriously ADD. But I can’t anymore, because it suddenly hit me – if they’re doing that to me, they’re also doing it to their clients, their colleagues and even their friends and family.

Multitasking has always been an issue – or, even more, a reality – in the legal profession. But it has now escalated to a dangerous level. Our technology has far outpaced our biology.

What your clients are buying is not simply your time. It is your wisdom, your experience, and most of all, your careful consideration. And a 1987 Harvard study on focus and concentration found that, when you are highly focused and experience an interruption, it takes from 7 to 11 minutes to return to that highly focused state.

So my question is – when you are talking on the phone with a client and also texting and glancing at a brief and motioning to your assistant, and your attention is divided – are you giving your client your best? Can you be fully listening – fully present – for what might suddenly be a critical conversation? An even more telling question: would you do this if the client were sitting in front of you?

And in that respect, are you charging your client for all of that time, even though pieces of it have been devoted to other work? If so, why? And if not, how in the world can you possibly record appropriate time for all the various work you touched while purportedly working for that client?

The answer, from my experience, is that either attorneys don’t try to capture (i.e., lose) the time, or at some point they add in a “farkle” amount to various client bills to account for the dozens – maybe hundreds – of times that a few moments of their attention was on that matter. And that, my friend, is writing fiction. Lying to your client.

And the bigger question — is our techno gadget society reducing our focus on doing our best work, and in the process, compromising both our personal and financial ethics?

A modest suggestion for all of my ethical colleagues in the profession. Notice the time you are NOT focusing on your client or your work. Resolve to change your modus operandi. When you are on the phone with a client. Commit to being fully present for the next conversation. Give them the focus and attention – and level of wisdom and skill – they are paying you for. Silence your cell. Put your office phone on DND. Close your e-mail window. Listen. Focus. Give your client your absolute best, and your most honest and accurate bill.

It’s not only the ethical thing to do. It’s the RIGHT thing to do.

Do you REALLY Need Case Management Software? No You REALLY Don’t, If — Part Three in the Case Management Series

Nalini Mahadevan replied to my LinkedIn post asking for experiences with case management software, and it inspired me to add a chapter in my on “Do You Really Need Case Management Software” Series. She asked “What CRM software do you recommend? I thought CRM needed a professional install.”

Thanks, Nalini, for a perfect segue into the next part of my ramble.

First, let’s distinguish between “CRM” and “CM” software. “CRM” means “customer relations management,” otherwise known as “contact management.” It does exactly what it says it does – manages people. It’s used by sales people, schedulers, and millions of people who need to keep track of, and in communication with, lots of other people. You can think of CRM as the old Rolodex on steroids. Good CRM provides the following functions:

  • A database of contacts with all relevant contact information such as name, phone, e-mail address, etc.
  • An e-mail center (not Outlook) integrated with the contacts, for easy electronic communication, and tracking of e-mails in and out.
  • Template and merge forms capability, for easy writing of letters, memos, forms, and all sorts of documents.
  • Database management – that is, the ability to parse and sort and organize your contact list so that you can communicate with highly specific groups, such as all family law attorneys in firms of less than five in zip codes between 602000 and 623000. Good CRM has built-in software to organize and shape your database.
  • Document organization The ability to link other information such as PDFs, photos, etc. to a specific contact file.

“CM” or “case management software,” is a similar but considerably different animal. It’s about managing matters. In other words, it’s “matter centric” rather than “people centric.” To badly mangle Shakespeare, “the matter’s the thing.” It accomplishes all of those things I outlined in my first post of this series, and has the ability to set up automated procedures to calendar important items. For instance, it can be programmed, whenever you utilize a certain template document, to calendar a reminder or a statute a specific time period afterwards. One of the most important strengths of case management software is its ability to connect and organize large amounts of disparate information, from documents received, to documents sent, e-mails in and out, discovery information, title or medical documents, etc. etc.

So. First stop in the quest: do you need to manage large amounts of information, deadlines, communications, appointments, etc. on a large number of files? Or is your biggest priority communications with clients, former clients, referral sources and other professional contacts? In other words, is your priority more in the realm of marketing and communications with people, or managing complex matters? To put it even more simply, are your priorities people or matters?

An estate planning attorney who does mostly simple documents and needs software mainly to book appointments and send and receive e-mail and track conflicts does not need case management software. They can create a library of template forms in their CRM, and will find the calendaring and e-mail modules in CRM perfectly satisfactory. In short, all of their needs can be accomplished neatly with a vastly less expensive contact management software such as ACT!, Chaos, Maximizer, Goldmine, and literally dozens of others, both locally installed and on the cloud – some of which are actually free. Here’s a link to one website which offers comparisons among just a sampling of the most popular CRM.

Beyond the difference in expense, there is another perhaps even more important difference. Most “CRM” is intuitive, easy to use and often has inexpensive mobile apps, while most “CM” has a perilously long learning curve, is complex and requires constant user discipline and attentiveness. Which means, unfortunately, you will need an enforcer and will experience a great deal of resistance and reluctance from others – and even, quite possibly, yourself.

So. The answer to my question, “Do You Really Need Case Management Software – Really?” For some the answer is “No!” Emphatically no. Really.

And Nalini, regarding your question concerning professional installation, you are right. “CM” does require professional install, and often hardware upgrades, and certainly contract support both for the technology and the users. More expense and more complexity. No wonder so many attorneys, staff and firms grow quickly to hate their CM. See my first post of this series.

Finally, I welcome all  comments from case management vendors, happy and unhappy CM and CRM users and colleagues. Let’s get a good fistfight going here. I can take it.

Next post I’ll get down and dirty and dissect specific CM software. Promise.

What Software Do You REALLY Need? REALLY? – Part Two

That Shiny Thing
Case management software is often that shiny thing that attorneys think they need. Kind of a status symbol, or a miracle solution to a chaotic operation. I can’t count the number of firms I have worked with where they have a full (and very expensive) complement of some type of CM software, and also had all the frustrations I listed in the previous post. And my assignment was (surprise!) to bring some order to their operations.

There are two important things to understand before making the decision to install any kind of software.

First, things will get worse before they get better, even when you do everything right. People hate change, many people hate computers and software, and many will resist purely on principle. So expect resistance at the beginning – it’s normal – until people realize the system is here to stay, or until they’re required to use the new system enough that it becomes the “new normal.”.

A warning. If you have a group of “immovable objects” for staff – people who you allow to make their own rules (often people you feel are so indispensable that you can’t afford to offend them, or who are the only people who control certain information), it just ain’t gonna work. By the way, if you have such people, fix it or prove they’re not indispensable. Fire them. Never allow yourself to be held hostage by a staff member.

Second, there is no magic bullet. No software, no training can make up for poor management. Supposedly, you are considering software because your firm is growing. If so, something else must grow: your skills in the art of management. The downfall of most attorneys is that they simply “want to do legal work” and consequently ignore the fact that they have a business to run and a team to manage. They want to simply close the door and go to work. As Michael Gerber says in his book the E-Myth, to succeed you must work ON your business, and not simply IN it. So, if you’re planning to institute software, be sure to institute better management skills along with it.

What Did Your Careful Study Tell You about Your Firm’s Software Need?
Are your needs mostly about complex document assembly? If so, that’s not case management, that’s document management. Case management software will seldom provide this ability, so don’t go looking for CM when you need “DM”.

Are your needs  mostly about time & billing? If so, again you don’t need full case management software. And please don’t go there. You will be buying more than you need, and paying more than you need, and wasting most of your cost. Even the ABA gets the issues confused. They have a table of comparisons of what they say is time and billing software, yet 80% of what they list is case management software with T&B capabilities.

Are your needs are more about communications? That is, contact management and database marketing – case management software is once again overkill. Look to the area called “contact management” software, otherwise known as “CRM”, customer relations management software. Nearly all CRM has valuable capabilities you can use in your practice, such as merge forms and e-mail management.

So When Do You Really Need Case Management Software? Really?
That’s the next post. We’ll get there. I promise. And after that – my jaundiced views on just what software to choose.

DON’T DON’T DON’T Use Free Email Like Google, Yahoo, MSN

Just received my third spam e-mail this week from a friend who uses the free Yahoo email service.

If you value your professionalism – if you value your ethics, and the security of your client communications, DON’T use free e-mail because there is absolutely NO security, and your contact list and the contents of all your e-mail is in the cloud for anyone who wants to grab it.

You DON”T have to have a website to have a secure email with your own domain name. It’ll cost you about $7 a month plus the cost of buying your own domain name, which is a one-time charge of maybe $6-12. If that’s too expensive, maybe you’re in the wrong business.

It’s easy. Here’s how.

Go to http://www.godaddy.com/. Find the “All Products” link at top left. Click on it. A menu will drop down. Click on “Email.” Another menu will pop up. Choose “Business Email.” Another page will pop up. Choose the center one, “Business Email.” When you do, yet another box will pop up which will urge you to upgrade to unlimited e-mail. Do it. You’re now up to a grand total of $6.99 per month for a complete e-mail interface, unlimited e-mail storage, 10 email addresses and a shared 10-user calendar. Or stay with the basic.

If you don’t have a domain name, you’ll need one, so follow the second option through and find one that works for you. Add another flat fee of maybe $6-12.

Finally, now that you have your own domain name, bite the bullet and create your own website. if you have even basic computer skills, you can do it yourself, or turn it over to your 13-year-old relative. But you do need one, now that you have your own web address for email, because as soon as the recipient gets your e-mail and sees the domain name, they’ll try to look you up. So you’d better be there.

The fact is, you really, REALLY REEAALLY need a website, especially if most of your business comes from referrals. Because increasingly, when someone gets your name from a referral source, they’ll check you out on the web before calling. So, if you don’t have a website, there are who knows how many people who DON’T call you, even though someone referred them to you.

So. A stealth way to push you to get a website – as part of FINALLY getting safe, secure email.

If I can offer any further thoughts, shoot me an e-mail at dustin@attorneysmasterclass.com.

Four Good Reasons to ALWAYS Do a Non-Engagement Letter

Made an offhand post to the ABA GP Solo LinkedIn group the other day. THought it was worth sharing here. 

When a prospect doesn’t hire you, should you send them a non-engagement letter? But of course. Here are my four reasons to do so.

The first reason is obvious – to have a track in your file that says you notified the person you were not representing them. That’s just good risk management, and most malpractice carriers love it when you do that.

The second is about professionalism. Someone considered putting their well-being in your hands. That’s an honor that deserves a “thank you.”

And the third is that thing called “marketing.” Part of the letter should detail how else you might be able to help them or someone they know in the future.

And the fourth follows the third. They should now be added to your marketing database for future contact (you DO keep in touch with past clients and prospects, don’t you??). By the rules of ethics, once someone has asked you for information, there are no barriers to future contact. It’s no longer considered “solicitation.” You can send them your firm newsletter (please don’t – they’re usually boring as H–) or better, devise some good and positive ways to communicate with them that they receive as positive, helpful and useful.

Those last are numbers two and four of the four fundamentals of personal marketing: build trust relationships, and stay in touch consistently over time. In other words, create “top of mind awareness” so that, next time they have a problem, they think of you first.

Oh, and it’s never a good idea to prejudge or assert anything about a case or the prospect in the letter. You could easily be sued for giving bad legal advice (after all, you didn’t get to the discovery, did you?) or defamation of character. So it’s best to simply say “I am not able to represent you at this time.”

Maybe You Don’t Need Case Management Software – Really.

An Opinionated View in three (or maybe more) parts

First the Disclaimer
These are my personal opinions, based on twenty-something years (it’s the only way I get to be “twenty-something”) of experience with solos, small and mid-size firms. Since I haven’t actually used any of these programs on a daily basis, I will not assert that every detail is technically correct. My view is through the eyes of my oft-frustrated clients.

Also important to note: as a business advisor to law firms, I regularly advise firms on operations, and because of that, I have made the decision to not affiliate with any CM provider. I don’t get paid by anybody to recommend software. So, here are my thoughts, and any bias is directly from the school of hard knocks.

So What Is the Case Management Software Anyway?
There are three main functions of “case management” software.

1. Time and billing – essentially an accounting function. Some don’t have actual billing, but do provide mechanisms for time tracking.

2. Document, activity, and deadline management. This is the heart of case management software.

3. Contact management. Keeping track of contacts and how they relate to cases, and creation of a database for purposes such as conflicts and marketing.

A fourth function which is rarely included in case management software is document assembly, which can be important to particular practice areas such as estate planning and business transactional  work. But don’t confuse this with case management software. It’s either a different animal, or an expensive upgrade to case management.

“Let’s Start at the Beginning, It’s a Very Good Place to Start” (with apologies to The Sound of Music)
So, the place to start is by identifying exactly what your current problems and obstacles are, and what you want to be able to accomplish, before you go shopping for anything.

How Purchase of Software Goes Horribly Wrong
There are five not very complicated reasons why a firm’s good intentions – and a big bucket of money – turn into a house of horrors.

First – they don’t do their homework. They don’t thoroughly research exactly what they need, don’t study the various offerings carefully, don’t do a “test drive,” don’t get adequate references, and consequently they buy the wrong software.

Second – they don’t buy official training, assuming that they can figure it out for themselves, so people are frustrated, misuse or don’t use the software, and start using “workarounds” to avoid it.

Third – they don’t buy an ongoing support and maintenance contract, depriving everyone from good troubleshooting and support, and often resulting in major downtime for the system, and consequent loss of productivity. Some software vendors seem to actually penalize clients who attempt to use the “per call” services instead of buying the more expensive support agreement, and end up with horrendous response – days or even weeks – for troubleshooting.

Fourth – they don’t document procedures in order to standardize the way the software is being used, and to provide an easy guide for new employees.

Fifth – they don’t place a senior partner or administrator in charge of its implementation, and use, and don’t enforce correct use.

The result? An amazingly high level of regret, teeth gnashing and blame for attorneys responsible for making the decision to buy software. While clearly, some software is better and easier to use than others, the real issues are the above. Even harder to use software will be more satisfactory if those five implementation problem areas are addressed. I have encountered literally dozens of firms which have highly capable software of various sorts that they have essentially discarded in frustration, because they didn’t properly address the implementation and operational issues.

So don’t be attracted by the shiny thing some software vendor dangles in front of you. Software decisions and implementation must be addressed in a very careful, thoughtful, and responsible way, or disaster will be the result.

Next Post: What Software Do You REALLY Need? REALLY?

GPSOLO Touts “Niche and Target Market” – Finally

I felt somehow honored (or at least vindicated) by the current issue of GPSOLO magazine, the publication of the small firm and general practice section of the ABA. The cover headline shouts “Niche Practices,” and the article is titled “Building a Niche Practice: Go Small to Go Big.” For the section whose charge is seemingly to represent the “general practice” attorney, such a cover story is a remarkable admission.

The article starts with some obvious statements: “it’s no secret that the legal marketplace is in turmoil… In this competitive environment lawyers must distinguish themselves from the competition in order to claim a bigger piece of the pie. One way to do this: build a niche law practice.” Duh.

For a decade I have been preaching that most lawyers look through the wrong end of their telescopes.  They look from the perspective of the 20th (or perhaps 19th) – century world — “this is what I do and here I am.” Or even worse, “I’m a lawyer, what do you need?” They should be asking “who is my target market, and specific services do they need?” “Anything for everyone” isn’t a target – it’s a plea.

Most consumer-level  legal work is rapidly being commoditized and is leaving the legal profession. Software, LegalZoom, RocketLawyer and hundreds of other web services offer consumers a wide range of cheap (though not always good) alternatives. The only long-term road to legal success is abandoning the commodity market and moving into the “value” areas, focusing on specific legal expertise that is highly valued by a clearly-identifiable segment of the sophisticated buying marketplace.

How do you “niche” and “target market?” There are two very specific ways. The first is the obvious: developing or focusing on a specific area of your expertise, identifying the market which most needs that service, and finding avenues to reach it.

For instance, I have helped an estate planning attorney in a state with complex pension rules dramatically expand their practice by positioning them as “the teacher’s pension protector.”  In another case, I helped a personal injury lawyer position themselves strongly in the parent and education community as the “child injury lawyer.”

The second route is less obvious. How the consumer perceives you  — as a commodity or a “value” lawyer — depends not so much what service you provide, but on the buyer’s perception of your special value to them. When a prospect is referred to you, someone they trust has identified you as having special – or at least higher – expertise than strangers from the phone book, or services from LegalZoom. In a very real sense, your referrer has actually “branded” you with that prospect. This ratifies the importance of personal referral marketing, which I have always emphasized in my seminars and my coaching.

The day of the “GP” lawyer is passing. Too many young lawyers, unable to find jobs, are hanging out their own shingles and taking whatever they can find — becoming the new (and legally dangerous) generation of “GP” lawyers. The smartest lawyers are moving up the food chain, identifying their niche and target markets, and prospering.

The Rise of the Walmart Lawyer

First came the Legal Grind. Then came Chicago’s Legal Cafe. What’s next?  A prediction.

Walmart – or some other Mart – will contract with LegalZoom or an equivalent to re-sell their service, buying it wholesale and selling it retail. They will then place hungry, young, otherwise unemployed lawyers in small cubicles next to the bank & the tax preparer cubicles, paying Walmart wages, to await customers needing a will or a lease or some other simple legal work. The lawyer will briefly interview the customer to determine their need, then find the appropriate form on LegalWhatzis, help the client enter information and print the document out, and offer a brief explanation of the document. The customer (note – not “client”) will then whip out their debit card and pay Walmart for the LegalWhatzis service plus a service markup – with a voluminous disclaimer printed on the cash register receipt.

And, as Inspector Clouseau would say, voila! The customer has bought a LegalWhatzis document. Has a lawyer-client relationship has been established? Walmart has made a profit from re-marketing LegalZoom. Enter the Walmart divorce, the Walmart will – courtesy of LegalWhatzis.

Hyatt Legal Services, eat your heart out. And Bar Associations get ethics heartburn. Who is liable for malpractice? Walmart, the young hungry lawyer, LegalWhatzis?

And wither the young hungry? Double shifts in the sporting goods department and free chili dogs at the snack bar?

Lies, Damn Lies, and (Legal) Statistics

Here’s my follow-up post dissecting the very interesting survey by Altman Weil on how corporate legal counsel make decisions on hiring lawyers. So here it is.

In my first comment, I gleefully dissed social media, which ranked a non-existent zero on a 1-10 scale. Now I want to take my comment back – sort of. Let me step back a couple of steps and explain why.

Much of the survey was related to a legal counsel’s perceptions of a lawyer or firm. In that venue, social media is definitely off their radar. Don’t expect corporate legal counsel to want to be friends on Facebook, or on your Twitter feed. That said, social media  does play an important part in their perceptions – but second-hand. Someone they trust – who IS on your twitter feed and is a friend (virtual or otherwise) referred them to you. In other words, wisely executed social media, which builds and maintains your referral network, can be very valuable indeed. So, social media ranks a “0” for corporate counsel. But quite possibly it DID get you the client – because of social media one step removed from that counsel.

“Demonstrated understanding of your business/industry” was the top-ranked issue with 9.6 out of 10 points. Again, I don’t imagine too many legal counsel do raw research on the web to find the right attorney. Rather, they first go to others in their industry, other lawyers, or other related professionals for recommendations. Only then, when they’ve gotten a couple of recommendations, they may do some research into the background of those lawyers. But the recommendation comes first, then the check of history & track record.

Same goes for the issue of “directory listings, traditional or online,” which ranked a paltry 3 out of 10. These fall into the same category as websites. The primary purpose of a website – at least for higher-level attorneys in more complex areas – isn’t so the attorney can be found in a Google search for “securities lawyers.” In fact, you really don’t want that type of call. Rather, it’s for VALIDATION – for a more valid prospect to check out a lawyer who has already been recommended. So, directory listings and websites both aren’t big factors – unless you don’t have one.

Why didn’t “personal contact: visits / phone calls / personal notes” rank higher than a 6? Because of a dichotomy. Those things, done too early in a relationship, are usually off-putting. Done judiciously after a reasonable level of relationship has been established are valuable. So essentially “cold” calls would probably rank in the minuses. And calls, cards and visits from “friends” would rank maybe an 8 or 9.

One item I didn’t mention in my last post was “Direct mail / email communications about a firm” which ranked a dismal 2. Why – or better said, why do you really need to ask? Because we are all so overwhelmed by e- and regular-mail that anything that is not strongly and directly relevant to our needs at the moment is viewed as simply annoying. The lesson here is to handle such communications with utmost care. Does it pass the urgency test – “you really need to know this” or just the our-gency test – “we really want you to know this.” If it’s the latter, ditch it.

Enough for now, a bit more later. In the meantime, I highly recommend you peruse the Altman survey and chew it well.

(No) Surprise – Clients Still Hire Lawyers the Old-Fashioned Way

A new survey of corporate chief legal officers by Altman Weil offers considerable food for thought – and marketing. Highlights, on a 0 to 10 (median) scale:

  • Social media isn’t on their radar – a 0 rating. How much time are your people spending on it?
  • Demonstrated understanding of their industry is critical – the top (9) score.
  • Referrals (8), personal contact (6) and demonstrated expertise(6) are still king.
  • Free seminars & training for the company’s legal department (3) are useful but not deciding factors.
  • “Branding” as full service (4) and participation in industry events (2) helpful but again not deciding
  • Websites, brochures & advertising surprisingly low (2) on the list
  • Direct mail & e-mail communications about the firm (2)
  • But the biggest surprise is the ranking of social media (0) and invitations to sporting and social events and dinners – (0).

So what are you doing right & wrong? Before you decide, look for my next post, which will attempt to deconstruct the survey and address the many unanswered questions of this surprisingly simplistic survey.

Trust Accounting & Credit Cards – A Potentially Combustible Pair

Colleague Peggy Grueneke, in her blog lawbizcoo, explains how the new IRS regulations concerning credit card acceptance create a very nasty web of ethical, financial and legal  traps for law firms. Accepting credit cards is increasingly important for all attorneys, but these new regulations create a level of complexity that could stop some from doing so. Clearly the new regulations come from the retailer point of view (users are all labelled “merchants”) and never considered the issues of trust accounting and retainers. An absolute must-read. if you’re out of compliance you could also be out of luck.

Ten Tips for a Successful Practice

The profession is going through an upheaval and shakeout of unprecedented impact. Some futurists predict that as many as a third of the lawyers in practice today will have left the profession within the next five years. How will small firm & solo attorneys need to change their thinking to stay viable? Some of my thoughts —

1. Learn from change, don’t resent it. Ask yourself “what is the opportunity here?”

2. The past ain’t coming back. Move forward or be left behind.

3. Embrace technology. It’s not a choice. Every old dog can learn new tricks. As Yogi  Berra once said, “first ya gotta wanna.”

4. Hire or keep a strong right arm. Without it you don’t have a practice. You have a job.

5. Attracting work is just as important as doing it. Get over it.

6. Develop a clear identity. General practice is not an identity. It’s a plea.

7. Three (okay, four) key words to remember that will help you stay alive: focus, niche and target market. You can’t survive trying to sell everything to everyone.

8. Be highly visible and active in your own and your target market’s community. You won’t be found by prospects if you are hiding in your office.

9. Your worst enemy is inertia, not your competition.

10. Think beyond this month’s billings. Without a roadmap to tomorrow you are living in yesterday.

Extraordinary Client Service – How It Translates to More, Better Business

Colleague and Legal Project Management Guru Pam Woldow of the Edge Group just posted a tale of client service as experienced at the Trump International Hotel. Her story, when considered seriously by attorneys and firms, can literally mean more, better business.

In working with my clients I emphasize the “Prospect to Client Continuum,” about how each touch, from first mention by a referral source to website impression, how the phone is answered, how they are greeted and treated when they come in, and especially how they are treated by the attorney – add up to a series of experiences that either increase or decrease their trust. And that translates to whether or not they hire you.

The truth is that most consumers, save the very sophisticated, don’t know how to evaluate whether or not you are a great lawyer. Instead, they will make decisions based on what others say about you (referrers) and how they “feel” about you. “Really liked them,” and “felt good about them” will be their reason for hiring. Conversely, “just wasn’t comfortable” or “we just didn’t seem to click” will be their reasons NOT to hire you (or sometimes even “too full of herself”). Those sentiments are the unconscious result of either great service, as alluded to in Pam’s post, or not-so-great service, as delivered in many offices.

Most lawyers think clients come in for the law, because of their “process” perspective. In truth, no client really wants an attorney or a “process.” They have a problem or opportunity, and the lawyer and the legal process are actually the obstacles they have to get through to get what they really want – a solution or a win. It is up to the attorney to deliver an overall positive “experience” and not just a “process.”

Then, great service continued throughout the representation adds up to bills that are paid faster, greater client cooperation (due to greater trust), and more client referrals. Yes, even if the outcome of your representation wasn’t the hoped-for one, so long as you have built their trust through great client care.

Every day, the profession is seeing more competition from every direction. It’s time we as a profession focus on service, not just process, because it’s the way the world outside the law works, and what consumers expect – and deserve.

Tips From an Old Friend In the Field

Long-time friend and client Jason Studinski, one of Wisconsin’s leading trial lawyers, has not only survived but thrived after the Wisconsin “off the cliff” experience when Governor Scott Walker managed to pass tort reform within 90 days of his election. A few years ago, BW (before Walker) I advised Jason in very successfully re-inventing his PI practice. He took that experience into the battle, re-inventing himself once again after the personal injury “cliff.” I recently asked Jason to share his insights on how he did it.

Jason: “There have been seven points that I have identified in the last three years concerning my approach to marketing.”

1. Relationships are everything.  We have worked hard to find new referral sources and shore up existing sources. (Cole: Jason fully understands and wields the power of relationship marketing.)

2. Get free press instead of paying for it.  We are going to be doing more press releases. (Cole: Jason harnesses the daily thirst of the press for copy.)

3. Recycle my marketing materials.  If I do a talk on a subject, I try to find additional venues for that same talk.  I try to turn the talk into articles.  I try to find talk radio for the subject too.  I will be posting all of this on our website as well. (Cole: Jason regularly uses the “three cushion shot,” re-purposing his work to leverage  the power of his marketing.)

4. Make use of part-time folks for purposes of marketing. (Cole: leverage your marketing with systems and people – lots of talent available cheap – if you know how to harness and direct them.)

5. Take advantage of the new visibility opportunities of social media. (Cole: Yup.)

6. Hyper-niche.  General practice no longer exists – even if you say I generally practice personal injury.  Niche. (Cole: two new keys to building a successful practice: NICHE, which allows you to identify and reach a specific TARGET MARKET(key two) efficiently, rather than trying to reach everyone.)

7. Say no. Now more than ever it is critical to say no to bad work or work that simply doesn’t fit.  We have to leave behind a scarcity mentality and adopt more of an abundance mentality.  This means that instead of taking work on that we don’t want or can’t do efficiently, we should say no – and spend that time on marketing and building the business. (Cole: SELECTIVITY means you don’t get overwhelmed with lots of work on low-value matters, so you can spend more of your time in high-value areas. “Busy” doesn’t always equate to “successful.”)

What Makes Clients Really Want to Pay Your Bills?

Heated discussion on Lawyerist.com about sending effective bills. Couldn’t help but add my two cents worth here.  

Most attorney bills, with their point-somethings and cryptic billing program-generated phrases, are horror stories that stress clients out and invite challenges. ”3.2 – conference call with opposing counsel. 1.4 research and writing of response. .5 – client telephone discussion.” It’s enough to make them crazy – and often does.

When a client opens your bill, they want to know two basic things: what did you accomplish for me this month, and how much are you charging for it? The bare bill, even one with a nice cover letter, doesn’t really tell that.

The solution is a “progress report.” Grab the detail bill and translate it into client language. “In August we made significant progress toward an agreement. We had several positive discussions with opposing counsel and have resolved some key issues…”

Let them know what you actually did for them. Not the process and the time it all took – but how you’re moving their matter toward resolution. Then, instead of the laundry list of point-somethings, give them a simple summary bill. Attorney hours 12.3, paralegal hours 8.2, miscellaneous charges $147.50, with a “total charges for month” line below. And at the bottom, “detail billing on request.” Unless your client is a sophisticated user of legal services, few will ever ask for the detail, because you actually answered their real questions: “what did you do for me this month, and how much do I owe?”

If your client is sophisticated you still send the detail. But the “progress report” is always a powerful idea that will help you maintain more positive client relationships – and get you paid more quickly.

Costco Has Some Wisdom for Lawyers

Costco is one of the nation’s smartest companies. Even their Costco Connection magazine, which began as advertising flack, has evolved into a publication whose every issue provides value and insight to its members (along with a lot of advertising flack).

Last month’s edition has an article entitled “Top Five Mistakes Small-Business Owners Make” that hits attorneys dead center, and re-states some of the key points I have been teaching my clients and firms for twenty years:

1. Not knowing why customers buy
2. Offering a transaction rather than an experience
3. Being the answer (wo)man
4. Allegiance to how it’s done
5. One-dimensional thinking

I encourage everyone to read the Costco Connection article first, and over the next few days I’ll provide my own legal spin on each.

The Legal Balloon Goes Pop

Another story in the ABA Journal predicting the already  in-progress turmoil and diminishment of the legal profession.

One thought that always rattles around in my head: the profit margin of the average business is, in a good year, 20%. Grocery stores operate on a margin of 2-3%. Law firms operate on an average profit margin of 45-55%, yes, even the pretty good local and solos. Let’s not talk about the margins for some PI firms.

The legal profession has never had  a focus on efficiency and process because of its immense “slop” factor. Even poorly-run, inefficient firms could make barrels of money because they were keepers of the secrets, gods of the law. But technology and the web is stealing the bottom layer, at the same time as hordes of young lawyers are wandering homeless, willing to do whatever work they can find for whatever the client will pay.  And you’ve read, I’m sure, about how technology is now being used to do the kind of complex discovery that associates used to do – and better than they did, because computers don’t get tired or distracted – and also the massive analysis of contracts and agreements to identify key issues. Like all technology, such is now being brought down to the retail level and being made available to smaller firms.

Frankly, all of this is why today I am working with more attorneys and firms than ever – not simply on “marketing” or “operations,” but on transformations – rethinking firm directions, structures, target markets and niches.

The profession is in the process of deflating — until 80% or more are operating like businesses, with similar margins. Law firms in general have no idea how to do that, and senior lawyers will be horrified to see their share of that 45-55 percent profit disappearing.

Law is becoming an business, an industry – at least 80% of it is. And yes, one with high standards. But no longer a high priesthood. And only a few sharply focused superstar lawyers and firms will be left making those amazing profit margins, while thousands of others will be joining the middle income brackets, or less.

 

The Walnut That Rules Us All

What’s stopping you from moving forward? Changing firms, hiring an associate, launching a new practice area, firing that assistant, moving to better offices? It’s likely a legacy from our ancient ancestors.

Sitting atop our spinal column beneath our cerebrum is a walnut-sized organ known as the limbic brain. It was there before our ancestors became thinking beings, long before we came down from the trees, and while it has numerous functions, one of its most important purposes was – and is – to keep us from being eaten in the jungle – to keep us alive. You could call it the “watcher,” or even better, the “watch out” organ. It’s hard-wired to be constantly on the watch for whatever could harm us, and in that respect we owe if a debt of gratitude. Because it was, most probably, responsible for the survival of homo sapiens.

But once we developed a brain – let’s say “consciousness” – it went underground. It didn’t disappear – no, still today it’s constantly scanning our jungle looking for potential disaster. But it doesn’t “talk” – it’s not a part of the conscious mind. Instead it communicates emotionally. So when, for instance, we confront anything new or consider anything out of our familiar order, that reptilian brain telegraphs us a message – “watch out or you’ll die!” And we get a lump in the pit of our stomach, a feeling of discomfort, or a vague sense of un-ease, urging us to avoid that new step, return to the fold, step back to the familiar, because the familiar is safer than the unfamiliar – even when we may be unhappy with it.

Why the ramble into phsyiology and psychology? Because, if we remain unaware of that constant “watch out” message being sent to us by our little walnut, we will forever be trapped by its message.

Heaven knows, our offices of today are noticeably devoid of lions and tigers and bears – creatures that could eat us. Very few of our decisions, short of stepping in front of a bus, are today likely to kill us. Make us unhappy, put us in financial distress, disrupt our lives yes, but kill us? Not likely.

The fact is that moving forward – growing, changing, experimenting, taking new paths – is the only road to success in any aspect of our lives. So, that walnut is not always your friend.

But it can’t be silenced, even in the safely OSHA-padded civilization we live in today. It’s hard-wired to do its job. It will continue to shout – at that emotional, unconscious level – those “watch out!” “step back or you’ll die” messages. And if we remain unaware of them, we are at their mercy. They will keep us trudging down the least-risk, most familiar – and often least rewarding – path forever.

If you truly want something better, something different, you need to start learning to recognize the telltale signs of its message – those non-verbal, emotional messages – and move them into the consciousness, your intellectual brain, so you can decide – will this decision truly endanger me? Or is the risk worth the potential reward?

Most people know, or at least have some inkling of, what path they should be taking to better their businesses, their careers, their lives. But the reptilian brain is a coward. After all, “fight or flight” is a true survival trait in a dangerous world. But the path to success almost always conveys some level of risk. Some level of fear. And therefore, some level of courage. And courage flies in the face of instinct.

So, for your consideration I share my best definition of courage: “positive action in the face of fear.”

“Top Ten Causes of Malpractice” Article Hits Home

My recent article “Of The Top 10 Causes of Malpractice & Grievances – 8 Are Sloppy Housekeeping!” has been reverberating around the web thru LinkedIn, Twitter and e-mail at a far greater volume than I ever expected, especially my comment on the all-too-typical lack of control of open files. I’ve lost count of the times I have forwarded my Case Manager Form to worried attorneys.

So I’ve decided to follow up in three ways. First, I will deconstruct the half-day seminar I have been conducting around the country,Ethics and Managing Risk in the Law Firm into small bites, and post them right here over the next few weeks.

Second, I will offer a free 30-minute coaching call on key areas of concern to the first 10 people who send  an e-mail request to me at dustin@attorneysmasterclass.com.

Third, I will again offer my Case Manager form, which provides a simple way for attorneys to track & manage the work, to anyone. Just e-mail me a request to the above address.

And stay tuned. If you’re not one of the first 10 requests, I’ll extend the offer again with each bite of my risk management program, so try again next time.

“Ethics and Managing Business Risk In the Law Firm”

On July 26-27 I’m conducting a very important seminar in Greenville & Columbia, South Carolina. “Ethics and Managing Business Risk In the Law Firm” is a risk reduction program with a major marketing training component, because I believe a high percentage of malpractice and grievance problems occur due to insufficient income, which compromises the attorney’s ability to deliver the highest quality work and can tempt good attorneys to misuse client funds.

A catastrophe or a serious error can completely destroy a legal career. Too many good attorneys have gone down in flames because of lack of preparedness for a disaster(and they come in a wide variety, from natural to employees or even partners), or lack of income. Because of its importance, it qualifies for 3.0 South Carolina MCLE credit hours, including up to 3.0 LEPR credit hours.

If you’re anywhere close, I encourage you to attend. You can register at http://bit.ly/IZRt6n. If you would like a copy of the handout, e-mail me at dustin@attorneysmasterclass.com

Of The Top 10 Causes of Malpractice & Grievances – 8 Are Sloppy Housekeeping!

The Florida Bar Law Office Management Assistance Service, and its Director, my friend Judy Equels, a while back shared some startling statistics with me as we co-developed a legal risk management program.

I’ve often said that most good lawyers are terrible business managers, and these statistics prove just that: of the top 10 most common malpractice & grievance issues, the top 8 are NOT LEGAL BUT OFFICE MANAGEMENT related – AND HIGHLY PREVENTABLE through instituting of basic operations systems and procedures. They are:

1. Failure to manage time/procrastination
2. Failure to docket – identify/document deadlines
3. Failure to manage information
4. Failure to obtain client consent
5. Failure to file documents timely
6. Missed or unresolved Conflict of Interest
7. Poor communications with client
8. Failure to follow client instructions
9. Inadequate discovery/investigation
10. Failure to know/apply the law

How do you know if you’re at risk? If your answer to this basic question: How many  files do you have open right now is – “uh, about. . .” If you don’t have a daily handle on how many, what you’re currently doing in each, and the deadline for its completion – you could well be headed for the cliff. At the very least, you’re losing too much sleep worrying about what you might have missed in that pile of files on your desk

Don’t ignore this major sign of potential disaster. If you would like a copy of my simple tool, the Case Manager Form, just shoot me an e-mail at dustin@attorneysmasterclass.com and request Form TP-04.