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.”)

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.

 

Told Ya So – Small Towns are the Next Big Thing

WSJ had some “breaking news” about some midwestern law schools who are telling their graduates to look again at the small towns, and are actively setting up internships in such communities. (See “New Lawyers, Seeking Jobs, Are Advised to Think Small)

The gist of the article is the revelation that, while in big cities the legal profession is eating its young (see June 19 WSJ article “Only 55% of 2011 Law School Grads Had Full-Time, Long-Term Legal Jobs), smaller communities are hurting for legal talent. Seems that the number of lawyers in more rural areas has actually decreased, and those that are left are disproportionately older and transactional. And many of them would like to transition their practices but don’t have any candidates.

Been saying that to my audiences for several years, based on experiences with several brilliant and insightful clients. One, Ethan Vessels, some time back purposely moved to Marietta, in the remote southwestern corner of Ohio, next to Parkersburg West Virginia, and has built a very productive and satisfying contingency practice based on old-school techniques of building relationships and leadership in the community. A powerful benefit: a great lifestyle in a beautiful smaller city. Another, Bill Steffens, is on the other side of the coin with a truly great practice in Broken Bow, Nebraska. Says Bill “I wouldn’t trade my lifestyle here for any big city you could name.” But he has had trouble attracting a successor.

The Lifestyle Benefit
Even if you’ve been in practice a while but are seeking a less stressful practice and/or a saner family lifestyle, do some serious study about your state’s smaller communities. The stats are in your favor – and the payoff could be bigger than you imagine.

New GP Solo Succession Planning Article Now Posted

The July/August issue of GP Solo Magazine will feature a longish article by me on succession & transition planning, based on the program I have been conducting for various Bar associations  around the country. Just posted to my Articles page. You can read it first right here – Succession Planning for the 62 Percent.

Comments are welcome, and I’m happy to answer individual questions as well. Just e-mail me at dustin@attorneysmasterclass.com.

Sometimes the Best Marketing Advice is the Simplest

Most attorneys know the best business comes from referrals. So – are you keeping in touch with your referral sources?

Do you have a comprehensive list of your best referral sources, and are you referring to it regularly to make sure you’re keeping those relationships warm & friendly?

Do you have a system to make sure you identify the source of every prospect, and to make sure that every referrer is acknowledged and thanked?

When you refer to others, do you have systems to make sure you let them know you’re trying to help them?

Do have a system to ask happy clients to let the referral source know they’re happy?

Basic marketing habits like these are the foundation of more expansive marketing plans. Without them in place, you could be losing big time, because of referrers who feel unappreciated, who don’t know you’re trying to help them, and who aren’t getting feedback from those they referred.

And by the way, note the word “systems” in each. “I do that some” isn’t a system, and means that you also DON’T do that a lot. Marketing, like the rest of your practice, should be systems-driven rather than attorney-driven. It’s the distinction between having a practice and having a great legal business.

If you could use some help in putting the systems in place, or learning what to say when you reach out to touch a referral source, give me a call at 407-830-9810.

Here Comes New Pricing – With a Vengeance

A revelation in the revolution – one Biglaw firm has begun aggressively value pricing AT THE HIGHEST VALUE END.

Holland & Knight  is now actively encouraging their top attorneys to offer clients a variety of pricing options – and giving them latitude in how they do it – and leaving traditional hourly rate structures in the dust.  This from a firm that, less than a year ago, was requiring its top attorneys to actually increase their hourly rates, and was resisting alternative pricing. Today they are open to essentially allowing attorneys to make deals with clients, to preserve the relationship and build new ones.

And even more interestingly, H&K is currently one of the financially healthiest firms out there, with almost no long-term debt and little short-term debt. Admittedly they have made some tight – and realistic – decisions on draws and compensation (The anti-Dewey approach), but clearly they’re  doing their best to stay ahead of, or at least on, the curve.

Kudos to a Biglaw firm that has decided to lead rather than grudgingly trying to hold the line.  But a warning shot over the bow of boutiques who have been the innovators.

Dinosaur Dewey Teaches the Profession Some Simple Lessons

Four lessons for the legal profession from the Dewey LeBeouf debacle:

Lesson One: Law firms are businesses, and need to be run like one. The old law school indoctrination that “you’re not a businessperson, you’re a professional” comes home to roost.

Lesson Two: Most lawyers, like doctors, are crappy business people. Great legal skills don’t equate to great business skills. The Dewey head cheese blithely gathered in other big-ego and big-reputation people like it was 2005 and the boom was on. He made outrageous promises that sank Dewey when they couldn’t deliver. The Executive Committee was even worse. They thought their role was to be the sounding board and implementer of the head man’s grandiose ideas, instead of what they were supposed to be: protectors of the corporate finances and manager of the CEO, not the other way around. A surfeit of bad business people.

Lesson Three: Today ain’t yesterday. It’s more like tomorrow. While big firms like Dewey follow old paths toward oblivion, hundreds of young firms, unencumbered by the structures and traditions of the past, are busy transforming hiring smarter, building more flexible, virtual structures, casting off the caste system, and learning how to profit by delivering great work at reasonable – and often flat – rates.

Lesson Four: Success comes from looking UP from your client’s perspective instead of  from the firm’s lofty perch DOWN. Ask Apple. Ask Google. Great businesses are customer-centered, not ego-centered.

 

Law Firm Brinksmanship, or the (Approaching) Death of a Practice

I recently heard a story on NPR about Whole Foods ceasing sales of many types of fish because they are overfished and in danger of disappearing. My first thought was that humans, as a species, are culturally conditioned to brinksmanship. We push everything to the very edge, then when it starts to hurt too much, we pull back and change things. Hopefully not too late (see “warming, global).
“Brinksmanship” led me to another unpleasant thought. In the last several weeks I have had to tell three attorneys that “this practice can’t be saved.” Not because they weren’t good lawyers; not because there wasn’t demand for their practice areas, but because they had ignored the signs of changing times. All three were in similar situations: precipitous drops in revenues, and out-of-pocket subsidies over too long a time while waiting for “things to return to normal” and doing little or nothing to increase their marketing or refocus their practices.

Unfortunately, things are normal – the new normal. All of them had exhausted nearly all their personal monies and couldn’t sustain the six months or a year it would take for them to re-think, re-direct and rebuild their practices. They had gone over the falls and were trying vainly to figure out how to swim back up.

A Measure and a Warning
IF – your practice revenues have dropped more than 20% for two quarters in a row –
IF – you have been waiting for “things to return to normal” –
IF – you have been subsidizing your practice from your second mortgage or IRA or kids’ college funds —

DON’T WAIT ANOTHER DAY.
Take action NOW –
— Pore through the articles & tips on my blog.
— Find everything you can on Bar websites about marketing.
— Join the ABA Law Practice Management Section and delve into the voluminous archives of Law Practice Magazine.
— Find the websites of other law practice development advisors & glean everything you can.

Then – STOP GATHERING INFORMATION AND SWIM LIKE CRAZY.
Your most important job is NOT (and never has been) “doing the law.” It’s making sure there is law to do – in other words, marketing. So start DOING rather than worrying about what to do. If you need some direction, call me.

Don’t play brinksmanship with your future.

Older Lawyers Subsidizing Failing Practices While Younger Lawyers Are Homeless

Three years ago I offered a succession planning program to Bar associations around the country with the warning that there was a crisis looming on the horizon relating to the aging of the profession. It was greeted with yawns. Now the subject is plastered all over the covers of scores of national, state, and local Bar publications.

Unfortunately, neat and tidy “transitions” are not in the cards for huge numbers of solo and small firm attorneys.

In a recent presentation to a malpractice insurer I observed that I am seeing a growing number of previously successful older lawyers who are now subsidizing their  failing practices with their retirement funds, until both the attorney and the funds are exhausted, and the attorney surrenders.

While this tragedy is in process, there are literally hundreds of young homeless lawyers who would be willing – no, enthusiastic – about teaming up with the senior lawyer to revitalize the practice, and gain the mentoring and direction of the older lawyer.

As I see it, the issue of  “transition,” as it’s neatly referred to, is really an issue of professional life or death for those at both ends of the career spectrum.

My friend Jordan Furlong, in my mind the most accurate and thoughtful of the futurists, in his blog Law21: Dispatches from a Legal Profession on the Brink  http://www.law21.ca/ quotes some truly frightening statistics from the U.S. Bureau of Labor Statistics. He reads the statistics in this way: “over the course of this decade, 440,000 new law graduates will be competing for 212,000 jobs, a 48% employment level.” This while literally thousands of senior attorneys are trying – and failing – to land their practices safely and retire.

Yes, certainly many are in the “commodity” areas of practice that are being killed off by the likes of LegalZoom and Rocket Lawyer. But many are in higher-value areas, and simply have not kept up with new marketing methods or, frankly, the die-off of their best referral sources. Many others are in smaller communities – where I believe the best opportunities still exist for newer attorneys to find a good income and a wonderful lifestyle – because in those areas “goodwill” (that is, reputation and connections in the community) still has value.

For thousands of younger attorneys who are struggling to survive in a raging sea of competition and change, the opportunity to team with a senior lawyer with reputation, skills and connections would be a godsend.

There are a lucky few lawyers who will be able to “sell” (or whatever their Bar associations call it) their practices for some amount of money. But there will be more, far more, whose successful careers will come to a sad end, as T.S. Eliot put it, “not with a bang, but a whimper.”

Watch this space. Over the coming months I will be providing more information to both sides of the aisle. I will also be working  in conjunction with Bar associations across the country to help senior attorneys make more successful transitions, and help younger attorneys connect with them, and work together for the benefit of both.

When Good Isn’t Good Enough

Being “a good lawyer” should be enough, right? Wrong.

Most people, unless they’re sophisticated and frequent buyers of legal services, don’t know how to evaluate the quality of a lawyer. In fact, they tend to assume that most lawyers are “good” lawyers. So if your main message, is that you’re good at what you do, you’re just one of the mooing herd.

What makes a prospect sit up and say “you’re the lawyer for me!” ??

A distinction. An affinity. A connection. Not just a “family lawyer” but a family lawyer specializing in divorces with special needs children. A business lawyer who grew up in the family business. A plaintiff lawyer who lost a family member in an accident. A business lawyer who speaks Serbian or Farsi or Korean.

“But – what about all those non-[your distinction here] people who might be clients?” OK, so how do you market to “everyone?” Ah, that’s the ticket. Let’s flip that over. So how do you market to the [Korean] [Iranian] [Serbian] [parents of autistic children] community? Easier. Now you can put your arms around a specific group of people, organizations, media, and even community leaders.

Four words to remember if you want to be more successful. Distinction. Affinity. Niche. Target market. Okay, five words. To cut you out of the mooing herd.

 

Oh, the Places You’ll (Fail to) Go: How Great Intentions Turn Into Great Disasters

Each time I’m called to conduct a retreat, I’m reminded that lawyers are great at lawyering, but often stink at anything relating to effective business operations. One recent “retreat,” actually an informal mediation in a year-old two-attorney merger, was typical.

Musing 1: The Shoemaker’s Children Have No – Common Sense.
Two plaintiff attorney “partners” had been working together as a “firm’ for over a year without anything in writing. No shareholder agreement. No compensation/origination plan. No shared responsibility for the credit line. No employment agreement. Now these two, who had started out as friends, were trying to sort out all the “I thought you” and “remember we discussed” and “I don’t recall,” “you owe me for…” and “I deserve…”

The result was predictable. Nearly all the optimism lost, fear and anger rising. On the verge of MAD – mutual assured destruction.

I was called in to see if this “partnership” be saved. After a tough day, we were able to work through most of the issues without bloodshed. But in the long term, even if the partnership proceeds, the friendship and trust will remain wounded – unnecessarily. All because they didn’t make it a priority to work out all the issues BEFORE moving in together.

Do YOU have a partner agreement & compensation structure, or just a handshake? “We trust each other” won’t be enough when big enough problems surface. Take time now to get it all in writing.

One partner dispute I remember from the distant past resulted in seven years of suits and countersuits. Worse than breaking a mirror.

Musing Two: Cancer Sometimes Masquerades as a Friend
The two above partners wanted to make it work. Unfortunately, one attorney’s longtime trusted right hand staff member didn’t want her world disturbed. Like a spoiled child, she subtly spread rumors, created dissension, and destroyed staff trust. Her sabotage and lack of cooperation was close to destroying the attorney’s trust in the incipient partner. Fortunately we were able to finally recognize the problem. If blind loyalty trumps a better future and staff is running the firm, it’s time for the attorney to turn in his diploma.

Musing 3: Succession Planning Isn’t for Wusses.
The purpose of the merger, such as it was, was to create a succession plan for the senior attorney. Unfortunately, it was approached in the same way as the “partnership.” No plan, no structure, no idea of what was needed to make it work – and a deep paranoia from the senior partner, even though the whole idea was his in the first place.

Succession planning isn’t for wusses. Attorneys who think they know everything too often end up failing miserably at the process. And both the senior and junior attorneys end up losing literally hundreds of thousands of dollars in personal income.

What we grudgingly cobbled together in the retreat worked for a few months. But presently the two are in a legal and financial struggle to the death, which will entail multiple lawsuits and mutual bloody clubbings in court.

If you’re looking toward a transition of any sort in your practice, doing it right takes planning and expert guidance. Anything less could be one of the most expensive mistakes you’ll ever make. Don’t do it blindly or ex post facto. Get expert guidance. Not sure where to find it? Call me. 407-830-9810.