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November 2017

Nov 28, 2017

Business Development for New Associate Attorneys

Question: 

I am a partner in a fourteen attorney firm in Denver, Colorado. We have six equity partners and eight associate attorneys in the firm. Our practice is limited to health care law. We represent many of the local hospitals in the area. Our associates range from associates that have been with the firm less than a year to associates that have been with the firm for over fifteen years. None of our associates have developed business development skills and none of them have ever brought in a single client. Most of our associates would not even be able to retain our existing clients if the partners for one reason or another left the firm. This is in part our fault. When we hired them we told them that we had plenty of client work and their mission was to “bill hours” and service our clients. However, as we the partners age and consider the future of the firm we are beginning to realize that this was a mistake. How can we turn this around?

Response:

The earlier that attorneys start to build client development into their weekly routines, the easier it will be for them to bring in business later. Many successful rainmaking attorneys began their business development efforts early in their careers, usually during their first year or two as attorneys. This is a pattern that you want your attorneys to emulate. The firm should set expectations about the kind of effort the firm is looking for at each level in an attorney’s career. It should then support these expectations with appropriate training for each level. Training should begin as soon as an attorney is hired. During the initial firm new associate training session, provide an hour’s instruction on client development. That will help new associate hires realize that they will have to bring in business later in their careers and they can start building a foundation  for later business development efforts immediately. The quantity of education on client development should increase as an attorney advances within the firm. This should be reinforced by mentors assigned to associate attorneys.

When your associates reach the point in their careers when they should be bringing in business, the focus on business development needs to increase. Business goals should be developed and attorneys at this level should be required to prepare annual personal business development plans. These goals and plans should be linked performance reviews and to compensation.

It will take time to create this culture in your firm.  It may be too late for some. I would announce that it is a new day, launch a program, and stay on top of it.

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John W. Olmstead, MBA, Ph.D, CMC

 

Nov 22, 2017

Law Firm Growth – Partnership/Merger

Question: 

I am the sole owner of a six attorney energy law practice in Houston. I have had my practice for twenty years and have enjoyed the independence of being the boss but I am tired of being solely accountable for the success of the practice, having to do all the management, and having all the worry and stress. I believe I have reached the point where I am ready for a partner or partners and I believe that the practice can be positioned for growth if I bring in a lateral partner, make a couple of my associates partners, or merge with another firm. I welcome any suggestions that you may have.

Response:

Whether you bring in a lateral partner, elevate your associates to partnership, or merge this will be a major step for you and you will need to do some serious soul searching. Here are some general thoughts:

Partnership is like a marriage. You must marry the right person or persons. Most partnerships that fail do so as a result of partnering up with the wrong partners. Compatibility is critical. Consider:

  1. Long term goals of both parties
  2. Work ethic computability
  3. Common interests
  4. Money and compensation

Thinking of merging? Research indicates that 1/3 to 1/2 of all mergers fail to meet expectations due to cultural misalignment and personnel problems. Don’t try to use a merger or acquisition as a life raft, for the wrong reasons and as your sole strategy. Successful mergers are based upon a sound integrated business strategy that creates synergy and a combined firm that produces greater client value than either firm can produced alone. Right reasons for merging might include:

  1. Improve the firm’s competitive position. Increase specialization – obtain additional expertise.
  2. Expand into other geographic regions.
  3. Add new practice areas.
  4. Increase or decrease client base.
  5. Improve and/or solidify client relationships.

Reasons for wanting to merge and your objectives. Ask yourself the following questions?

  1. Do you want to practice in a large firm? If not, what is the largest firm that you would want to practice in?
  2. What is driving the desire to merge?
  3. If the desire to merge is being driven by a desire to retreat from internal problems – what have you done to address these issues internally?
  4. Is your name being part of the firm name important to you?
  5. What are your expectations and objectives for a merger?
  6. What are you looking from a merger partner?
  7. Make sure that you look for a complimentary fit. If you are weak in firm leadership, management and administration – look for a partner that is strong in these areas. Strong leadership, management, and administration may be hard to find in a firm under 25 attorneys.

Partnering up with others can be a great move for you if you make the right people partners for the right reasons or merge with the right people for the right reasons. Due your due diligence and your homework.

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John W. Olmstead, MBA, Ph.D, CMC

 

Nov 15, 2017

Law Firm Marketing – Paid Seminars

Question:

I am a partner in a six-attorney estate planning firm in Dallas, Texas. For many years our primary marketing activity has been seminars that we put on for clients, prospective clients, and referral sources. These seminars have been either put on solely by our firm or in partnership with other organizations such as nursing homes, hospitals, etc. These seminars have been free of charge. We provide a lot of value at these seminars and have been wondering whether we should charge a fee. We would appreciate your thoughts.

Reponse:

Do not assume that you must offer free seminars to get a marketing-benefit spinoff nor that only free seminars produce other business. In some respects paid-attendance seminars are even more powerful as marketing media than are free seminars. For one thing, the attendees who pay to attend are serious prospects. They are prospects that are qualified at least to the extent of having demonstrated serious interest in the subject, whereas at least some attendees at a free seminar are curiosity seekers with nothing better to do that afternoon or evening.

This is balanced by the heavier attendance at the free seminar, which may produce a greater number of good prospects, if not a better ratio of good prospects to curiosity seekers. That is there is a presumption of heavy attendance, for there is no guarantee of heavy attendance even at a free seminar.

There is a compromise position possible. You may opt to subsidize your own seminars by keeping the cost of attendance low which should produce good attendance, while still screening out the idle curiosity seekers. This would enable you to have modest registration and attendance fees.

I suggest that you review your past attendance history, ratio of attendees that have become paying clients, and determine whether you have an issue of curiosity seekers. If you have been doing a good job converting attendees to clients and have not had a problem of curiosity seekers I would probably stay with free seminars. If you have problems with curiosity seekers and your costs are getting out of control – I would consider modest registration and attendance fees. I would not look to these seminars as being a profit center for the firm.

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John W. Olmstead, MBA, Ph.D, CMC

Nov 08, 2017

Law Firm Retreats – Should Spouses be Invited?

Question: 

Our firm is a twenty-five attorney firm located in Austin, Texas. I am the firm administrator with the firm. We are planning on having a firm retreat consisting of the attorneys in the firm in February and are wondering whether we should included the spouses. Some of our partners think we should include spouses and others think that we should not. We had had retreats in the past and have not included spouses. I would appreciate your thoughts.

Response: 

Having spouses attend law firm retreats varies from firm to firm. The majority of the retreats that I have facilitated have not had spouses attend. The decision to have wives or husbands of attorneys attend the retreat depends on the retreat program and the retreat goals. Firms do not generally invite spouses when the retreat is devoted primarily to firm business and little time is available for recreation and informal socializing.

If social programs are planned, some firms do invite spouses and design special programs (e.g. sightseeing tours, tennis/golf games, lunches, special sessions) for them, with couples getting joining each other in the evening for dinner and evening programs.

Some firms will setup special sessions during the weekend to orient spouses to the firm’s organization, operation, and culture. In these special sessions, spouses are introduced to the firm’s history, culture, pecking order among the lawyer ranks, why attorneys work after hours and on weekends, and how career advancement works.

When wives or husbands occupy positions in the firm, special day-to-day programs are often created that deal with any problems that the firm may be experiencing as a result of their employment. Problems such as spousal conflict, differences in compensation, and work production are just a few examples of issues that can occur when spouses are employed in a law firm. Special pre-retreat consideration needs to be given to how the presence of family staff members would influence the retreat proceedings.

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John W. Olmstead, MBA, Ph.D, CMC

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