Are You Building a Legal Business – Or a Job?

Every successful non-lawyer business transforms itself every few years in its continuing quest for growth. Small firms seldom do.

Law school stunted the thinking of most lawyers by telling them “you’re not a business person – you’re a professional,” inferring that a “business” was somehow slightly dirty and inferior to the professional firm. So most solo/small firm attorneys spend their careers working in “non-businesses.” They treat it like a job – come in, work hard, go home. They don’t plan for growth and change. They don’t plan for attracting new business – another legacy from law school – the “better mousetrap” theory of marketing – just do good work and clients will come. Even growth – hiring staff or associates – is resisted, and usually done only with reluctance, and resentment of the expense.

What’s the distinction?

It’s a job when the owner does all the work and is the center of everything, and when they’re gone, no business gets done.

The “legal business” has a”life” outside the lawyer. First, it has a clearly identifiable operating structure –

    • “Externalized knowledge” – forms, checklists, procedures for all phases of firm operations, from office management to basic legal processes and functions
    • An organized resource base of standardized “boilerplate” documents, letters, etc.
    • At least one well-trained, quality staff member who facilitates and supports firm operations
    • Technology adequate and fully functioning — a true network with server and backup, current (and legal) software and functional contact & client management and/or case management software
    • Effective case, file and client management procedures and systems

Second, it has an active and clearly definable marketing program, consisting of:

      • A complete and maintained client, former client and prospect database
      • A basic marketing plan and list of targeted organizations and activities
      • A documented base of active referral sources
      • An effective website and web presence
      • A documented list of firm marketing activities and organizational involvement
      • Professionally managed finances – financial & billing software, accrual accounting, and a fully functioning collections management system

Every week I talk to skilled, experienced attorneys who are somewhere in the middle or late phase of their careers and are still at the “job” level, who want to transition, sell – or just keep the practice from killing them. I have only two solutions to offer: quit the job, or evolve it into a legal business. A job has little sales value; the legal business has much.

If you’re one of those attorneys, maybe it’s time that you explored going over to the “dark side” – building yourself a business that works for you, instead of just continuing to work hard. The payoff is considerable – now, and in the future, when you’re thinking about transitioning.

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.