Law Practice Management Asked and Answered Blog

Category: Human Resources

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Apr 04, 2017

Law Firm Retreats – Including Key Staff Members

Question: 

I am a partner in a forty-five lawyer firm in Memphis and a member on the firm’s executive committee. We are planning on having a two-day planning retreat in June of this year. We have had these retreats every year for the past six years. Past retreats have only included attorneys. This year we are considering including staff members. We would appreciate your thoughts as to whether this is a good idea.

Response: 

A firm invites all key staff to a retreat when they can play a major role in identifying problems and developing solutions. A firm retreat is an excellent forum if the partners or management have determined that individuals at different levels within the firm are having communication problems – for example – where communication is inadequate between:

Having these individuals participate in solving their own communication problems at the retreat usually produces better results than those obtained when the partners hand down orders that may not deal with the real issues. Staff participation can help identify problems and can involve more firm members after the retreat in the implementation of solutions – improved buyin.

As a rule, it is very productive to include individuals from nonprofessional or non management levels at a retreat when they are eager to be involved in problem solving efforts on a day to day basis.

A retreat solely for partners at the senior level is conducted to review firm progress and to deal specifically with financial, compensation, conflict between partners, growth planning, business development, or unique problems with staff members.

Some firm hold separate meetings for each level of staff in addition to combined meetings with attorneys.

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

Mar 21, 2017

Retaining Valued Associate Attorneys – Conducting Exit Interviews

Question: 

Our firm is a fourteen attorney law firm in San Diego, California. We handle business transactions and litigation for business firms in the area. I am a member of the firm’s three-member executive committee. We have been experiencing associate attorney turnover for the past two years and don’t know whether it is due to more opportunities in the job market as the economy has improved or whether we have internal issues. We would appreciate your thoughts on the matter.

Response:

I suggest that in the future you conduct structured face-to-face exit interviews when associates resign their positions. You may want to even interview associates by phone that recently resigned and left the firm. Exit interviews can provide an opportunity to find out how you can retain your valued associates. Departing lawyers that are willing to be open regarding their experience with your firm can provide valuable feedback and information as to how your firm is viewed by your associates, why your associates are leaving, and what the firm can do to resolve issues and improve retention.

I suggest that you conduct either face-to-face or telephone interviews or as a last resort written confidential voluntary questionnaire. Questions might include:

  1. What influenced your decision to join the firm?
  2. Has the firm met your expectations? Describe?
  3. Were your work assignments aligned with your personal and professional goals and interests?
  4. Did you find your work assignments interesting and challenging?
  5. Were there particular individuals who had a substantial impact on the quality of your experience here? How did they impact your experience?
  6. Did you receive timely and quality feedback regarding your performance?
  7. What experiences did you find the most positive?
  8. Least positive?
  9. Is there anything that the firm could have done to improve your experience here?
  10. Were you satisfied with your compensation and benefits?
  11. Why did you decide to leave the firm?
  12. What factors influenced your choice of the new firm that you joined?
  13. Other issues or recommendations that you feel would be helpful for the firm to know.

After you have solicited feedback via exit interviews it is critical that you look into any issues reported, determine whether there is merit, and take appropriate actions that can be taken to resolve issues and improve retention.

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

Jan 31, 2017

Law Firm Administrator Competencies – Searching for a First-Time Legal Administrator

Question:

Our firm is a twelve attorney business litigation firm in Springfield, Illinois. I am a member of our three member management committee and I have been charged with helping the firm find and hire our first legal administrator. This will be our first experience. While we have a bookkeeper that handles our billing and accounting the rest of the firm’s management matters are handled by the management committee. We believe that we have reached a size where we need help with managing the day-to-day operations of the firm. What sort of skill set and type of person should we be looking for?

Response:

The starting point is to have some heart to heart discussions internally to make sure all the partners are on the same page regarding the role the firm is looking for an administrator to play? Is the firm willing to delegate authority with responsibility and let the administrator really manage the business side of the practice (a true administrator) or is the firm looking for more of a lower level office manager? This will dictate the skill set and type of person that you should be looking for. I suggest that you develop a job description for the position listing not only the duties but the authority levels as well and have every partner in the firm sign off on it.

An excellent resource in the Association of Legal Administrators (ALA) which is the professional trade association for legal administrators. They have published a document listing 56 competencies in the following five categories:

Click here to download the above document.

ALA also has some helpful areas on their website for a law firm looking for an administrator including articles on evaluating your firm’s needs, – the candidate search process, and defining the role of the administrator.

Many firms burn through their first administrator quickly and end up having to try again with another person or two. First time failure if often the result of not determining up front and having the partners agree regarding the role, expectations, and authority level of the administrator.

Do your homework and you will increase the change of success with your first administrator.

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

Oct 04, 2016

Law Firm Client Business Development – Motivating Lawyers to Develop New Client Business

Question:

I am the managing partner of an eighteen attorney firm in New Orleans. We have six equity founding partners, four non-equity partners, and eight associates. We represent institutional clients. Four of the six equity partners are in their sixties and two are in their late fifties. The six equity partners are concerned about the future of the firm as they approach retirement. If they retired today the firm would cease to exist – the non-equity partners would not be able to retain our existing clients and acquire new clients. We have not been successful at motivating our non-equity partners to develop and bring in new clients. We have harped on this for years and encouraged all attorneys to develop business. We implemented a component of our non-equity partner and associate compensation system to compensate them for new client origination. Unfortunately, we have not been able to motivate our non-equity partners and associates to develop new sources of business. Our non-equity partners and associates have a nine to five work ethic and an entitlement mentality. Would you share your thoughts?

Response:

Often law firms hire associates simply to bill hours and perform legal work. Then years later they are asked to develop clients. Many are unprepared and at a loss as where and how to start. I believe that if you want attorneys to develop clients you have to hire attorneys that have the personality, ability, and you have to get them started on business development in their early years.

To turn your non-equity partners and associates into rainmakers at this stage will be difficult but not impossible. Here are a few ideas:

  1. Insure that your compensation system reinforces and rewards business development  results. However, don't be surprised that even if your system rewards business development behavior does not change.
  2. Extrinsic motivators such as compensation often are not as impactful with professionals as intrinsic motivation that involves engaging in a behavior because it is personally and professionally rewarding – performing an activity for its own sake rather than the desire for external reward. Many law firms are requiring attorneys to submit annual personal business goal driven plans that are incorporated into annual performance reviews. I have found that these plans as or more powerful than compensation in developing new behaviors such as client development when an attorney is uncomfortable with such behaviors.
  3. Integrate the compensation system with personal goal plan achievement.
  4. Implement an equity partner admission program (partner track) that outlines requirements for admission. Make business development goal attainment a component. Make it clear that to become an equity partner you must be a rainmaker.
  5. Provide business development training and coaching for attorneys willing to participate.
  6. Have serious discussions with non-equity partners and terminate those that are not meeting production and client development goals.
  7. Consider hiring lateral attorneys with books of business or merging with another firm.

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

 

 

 

 

Jun 22, 2016

Law Firm Associate Satisfaction and Retention

Question:

I am the owner of a twenty attorney litigation firm in Seattle. The nineteen associates are all in the same tier or category and are paid a salary plus bonus. Their time with the firm ranges from one to fifteen years. I enjoy sole ownership but I realize that to continue to grow and prosper I must make some changes. I have recently lost several associates that I would have liked to have stayed with the firm. I am also getting stressed having all of the management responsibility since I currently make all of the decisions. Several associates have told me that the morale is low. I welcome your thoughts.

Response:

Compensation and benefits is one determinant as to whether associates are satisfied with employment at a firm. However, compensation and benefits is not enough to motivate and retain top performers. Law firms must help their associates invest in their careers and motivate and help them develop competencies and skills to enhance their productivity. With the downsizing, push for 2000+ annual billable hour push, etc., associates are skeptical about their futures and feel they have no power or ability to influence their careers. Associates want:

Here are a few thoughts:

  1. Share more information about the firm where you can – its plans for the future, where it is heading, it's strategic plan, etc.
  2. Improve and open up communications with associates.
  3. If there are other tiers such as senior associate, non-equity partner, equity partner – prepare and share with your associates documents that outline what it means to be a member in each tier and what performance and other factors are required to advance to each tier.
  4. Improve your review process and incorporate goal setting with each associate.
  5. Consider a management advisory committee or other committees where associates can participate in firm management.

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

Jun 15, 2016

Law Firm Performance Management – Managing Performance Reviews

Question:

Our firm is a 15 attorney firm in Kansas City, Missouri. I am a member of the management committee and our committee is charged with the responsibility of determining partner, associate, and staff compensation. Several years ago we switched to a competency based goal driven system for partners, associates, and staff. The system requires self-evaluations, peer evaluations for partners and associates, and self-evaluations. This requires extensive performance reviews, tracking, scheduling, and documentation. We are using Excel spreadsheets and MS Word documents and having a hard time managing all of this. Do you have any ideas?

Response:

With 15 attorneys you probably have close to 30 people in the firm. I would look into performance management software (performance appraisal software) to management the process. Typical features of performance management/appraisal software, depending on the vendor, include:

Some vendors offer cloud-based solutions and others offer install software solutions.

Just a few of the vendors include:

Some of these solutions can be pricey – so look into a solution is right-sized for your firm. I have firm's your size using solutions that are costing around $3000.00 per year.

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

 

Jan 12, 2016

Retaining Key Law Firm Talent Through Remote/Virtual Work Arrangements

Question:

I am the owner of a five attorney firm in Austin, Texas. My accounting/office manager has just advised me that she is resigning her position as a result of her husband's job being relocated to another city on the west coast. She is the best employee that I have had the pleasure of working with and I am not sure where to start regarding finding her replacement. She will be hard to replace – – not just her skills – but her manner, relationship with me and other members in the firm, clients, etc. She is truly a class act. I would appreciate any thoughts that you may have.

Response: 

Maybe you don't have to lose her. Why not consider a remote/virtual arrangement. I know – it sounds crazy but I have several law firm clients that were in similar situations and decided rather that lose a key employee to have them work remotely.

The first situation occurred several years ago in Chicago. The firm was going to lose a key paralegal that had been with the firm for fifteen years when her husband was relocated to Washington state. The firm was already paperless and had an excellent computer system that facilitated remote communication. The missing link was the telephone system and how to handle client calls coming in for the paralegal. The firm installed a VOIP phone system that could seamlessly transfer a call as if the paralegal were down the hall. An office was setup in the paralegal's home in Washington state, procedures and protocols put in place, and other practices such as joining her in via Skype on the weekly firm meetings. The arrangement has worked out exceptionally well for five years.

The second situation occurred six months ago in Chicago. The firms accounting manager's husband was transferred to Florida and she tendered her resignation. The owner asked me to help him find a replacement and I asked what he thought about a remote arrangement. We discussed how the various accounting tasks would be handled and coordinated remotely from running pre-bills, making bank deposits, recording client payments, billing, paying bills vendor bills, etc. and he decided to give it a try. A virtual private network was installed, her home office was outfitted, and procedures, protocols, and checks and balances put in place. The arrangement has worked out well. Four months after the arrangement was implemented the firm merged with another firm and now has two office locations and the accounting manager is effectively handling the billing and accounting for both offices from her Miami Florida remote location. The owner is very happy with the arrangement.

So, before you accept her resignation and begin looking for a replacement – you might want to consider a remote/virtual arrangement.

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

 

Nov 03, 2015

Law Firm Administrator – New and Struggling

Question:

I am a new administrator in a 17 attorney law firm in the greater Boston area. I am the firm's first administrator and this is the first law firm that I have worked for as a firm administrator. I been on the job for six months and I am struggling. I don't know whether I am living up to the expectations of the partners and I feel like I am lost. I would appreciate your thoughts.

Response:

While administrators have made great strides in terms of role and acceptance during the past decade, administrators in firms of all sizes still remain frustrated with:

– Poor, slow, and ineffective decision making
– Ineffective firm leadership and governance
– Internal politics and infighting
– Micromanaging
– Management by committee
– Lack of influence and ability to effect change

Being the first administrator for a law firm is tough. In additional to proving yourself to your partners you will have the additional task of justifying the position itself. After a few months when the honeymoon is over some partners will start questioning whether the position is necessary and worth the expense. Don't assume that the partners really thought through what their expectations were for the position prior to hiring you. Don't wait for them to manage you – you must take a proactive role – initiate discussions regarding expectations and identify priorities, projects, etc. Look for low hanging fruit when you can enhance revenue or reduce costs in the short term and track any results achieved.

Few things are as important to an administrator’s future as that person’s ability to influence the decision-making process and effect change.  Skills and competencies are important but so are results. In order to transcend to the next level and enhance their value to their law firms, administrators must help their firms actually effect positive changes and improvements and improve performance. This requires selling ideas to partners in the firm and having them accept and actually implemented. To succeed administrators must achieve three outcomes:

- Provide new solutions or methods
– The firm must achieve measurable improvement in its results by adopting the solutions
– The firm must be able to sustain the improvements over time.

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

 

 

Oct 13, 2015

Law Firm People Management and Accountability

Question:

I am the managing partner of a newly formed 8 attorney firm in Austin, Texas that was formed last year when several of us left another firm and started this firm. The most frustrating part of the managing partner job is managing the people – this includes other partners, associates, and staff. How do I deal with people that are not following firm policy or doing things they should not be doing?

Response:

Managing people is one of the toughest challenges that law firms face. Challenges often involve  people not following firm policy and doing what they should not be doing. It drives owners, managing partners, and administrators crazy.

My advice to frustrated owners, managing partners, and administrators – tell them to stop. Seriously. As the managing partner of your firm you can't beat around the bush and be sheepish concerning your expectations concerning desired performance and behavior in the office. Confront the performance or behavioral problem immediately. Manage such problems in real time. Don't wait for the annual performance review and don't treat serious problem as a "self-improvement" effort. Tell them how you feel about the performance or behavioral issue, the consequences for failure to resolve the issue, your timeline for resolving the issue, and the follow-up schedule that you will be using to follow-up and monitor the issue. If they must resolve the performance or behavioral issue in order to keep their job tell them so. They may need this level of confrontation in order to give them the strength to be able to deal with their issues.

Being a wimp does not help you or them. Tell them like it is and conduct a heart-to-heart discussion. You will be glad you did.

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

Oct 06, 2015

Law Firm Growth – Associate Hiring and Retention

Question: 

Our firm is a two partner firm located in Rochester, MN. We have been approached by a solo practitioner that wants to sell us his practice. The price and terms seem fair but we are concerned about staffing and managing the other office. His practice consists of himself and two staff members. We would have to maintain a second office, hire an associate or two for the office, and then manage both operations. We have recently tried to hire an associate without success by reaching out to targeted lawyers that we knew in our local area. Frankly, acquiring this practice is a little daunting. We would appreciate your thoughts.

Response: 

I believe the first issue is whether you are looking to grow the firm and are willing to undertake the additional management responsibilities that comes with growth. Some firms are ready for growth and others are not. Larger is not necessarily better. 

I would not let your unsuccessful associate hiring attempts discourage you from acquiring the practice if you desire to grow and the price and terms are acceptable. You may need to cast a wider net and be more focused in your efforts. Recently a two attorney firm in Mid-Missouri hired an associate from St. Louis. A two attorney firm in Central Kentucky hired an associate from Lexington, Kentucky. It may take some time but a concentrated recruiting effort usually pays off regardless where you are located – even in small communities. 

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

 

 

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