Law Practice Management Asked and Answered Blog

Category: Human Resources

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Nov 18, 2014

Law Firm Administrators – Effecting Change by Selling Your Ideas to Your Partners

Question:

I am the firm administrator with a 27 attorney firm in Detroit. We have fifteen partners and twelve associates. I have been eight months with the firm and in this position. I replaced another administrator who was terminated because the partners did not believe he lived up to their expectations. He was their firm administrator. This is my first law firm and I want to be successful. I feel that I am struggling and am not sure of my priorities. I would appreciate your thoughts.

Response:

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:

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

 

 

Aug 26, 2014

Law Firm Attorney Staffing/Growth Models – Overview

Question:

I am the managing partner of a 16 attorney insurance defense firm in Chicago Southwest Suburbs. We have 4 partners and the balance of our attorneys are associates – many of which have been with us for several years. We are on a growth spree and needing to hire more associates to handle client assignments. Associate hiring, mentoring, and training has always been a challenge for us and our clients are restricting us in the way we use associates on their files. I would appreciate your thoughts.

Response:

Attorney staffing/growth models include:

  1. Grow Your Own Associate Staffing
  2. Lateral Associate Staffing
  3. Contract – Staff Associate Staffing
  4. Lateral Partners (Equity or Non-Equity)
  5. Of Counsel (Various Approaches and Purposes)
  6. Mergers (Or Small Firm Acquisitions)
  7. Branching

I will address the pros and cons of each model/approach in upcoming postings. I will begin by addressing the first one.

The traditional staffing model for insurance defense firms has been Grow Your Own Associate Staffing.

PROS

  1. Large available supply of new lawyers.
  2. Lower salary than experienced lawyers.
  3. Better odds of integrating them into the firm's existing culture.

CONS

  1. Takes time training, mentoring, getting them ramped up.
  2. May take 2-3 years before they are profitable.
  3. Once they become profitable you may lose them to another firm.
  4. No business comes with them so you must have enough work to keep they busy.
  5. Clients may be unwilling to allow you to use them or dictate how you use them.
  6. Clients may be unwilling to allow them to train on their dime.
  7. Will have to bill them out at lower billing rates than lateral associates or lateral partners.

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

Jun 03, 2014

Law Firm Policies and Procedures

Question:

I am a solo practitioner in Central Illinois. As my staff seems to expand, I feel a need to become more formal.  I have a question about nondisclosure agreements with staff?  Also office procedures or rules?   Also in hiring I am finding less and less candidates that lack any experience in a legal setting. The Illinois State Bar Association Law Practice Management Section may want to consider a half day program that is internet based to acquaint staff who have office experience but no legal experience with some of the basic issues including nomenclature, confidentiality, basic legal drafting, etc.

Response:

Our committee has not addressed this of late – we may have years ago and if we did there might be an article in the dark past in the Bottom Newsletter which is the newsletter of the Standing Committee on Law Office Management and Economics. 

Most of my law firm clients are addressing the topic usually in their office policy handbook as opposed to a separate document. You might want to begin to put together both an office policy (employee handbook) as well as a "how to procedural manual" as well.

Suggest that the office policy (employee handbook), in addition to other topics, cover policies on:

Have a sign-off page in the Policy (Employee Handbook) and have each employee acknowledge that they have read said policies and file a copy in each employee's personnel file.

ABA has a book on Office Policies and Procedures that can be purchased that you might find helpful: 

http://shop.americanbar.org/eBus/Store/ProductDetails.aspx?productId=218026

Thanks for the suggestion regarding the CLE. I am the CLE coordinator for our committee – so I will bring up the topic and see what the group thinks.

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

 

 

Apr 29, 2014

Law Firm Associate Training and Mentoring – Ideas for Reducing Spin Time and Increasing Profitability

Question:

We are a three attorney personal injury plaintiff firm in Moline, Illinois. There are two partners and one associate in the firm. We handle a large volume of small PI files – currently we have 700+ open files handled by three attorneys and 5 assistants. We recently hired our fourth attorney – second associate – that came to us with 20 year's experience as an associate in several large firms (100 plus attorney firms). The attorney, who has been with us for about 8 weeks, has never handled personal injury cases and is having some problems getting organized. Do you have any suggestions?

Response:

I am a believer that time invested in orientation, training, and mentoring upfront can dramatically reduce a new associate's spin time, help them get online quicker, and improve overall profitability. Even though your associate has 20 year's experience in a large law firm – the work and the case management challenges are different. The associate may never have had overall management responsibility for cases or client relationships. The associate may have been assigned tasks to be completed with the partner having the case and client management responsibility. If the attorney did manage cases there is a major difference between managing say 25-50 large cases versus managing 150 small cases. There are new case management and client management skill sets and practices that will have to be developed and practiced in addition to the new area of law.

Invest time training and mentoring and share case and client management tools that can help your associate get off to a faster start.

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

 

Mar 04, 2014

Lawyer or Businessperson

Question:

I am an attorney in Miami. I have been out of law school for five years. I worked with a small firm for a year and then went solo and have been doing contract work for other law firms for the past four years. For the past year I have been trying to get a position as an associate with a small firm – but have not had any success. Recently, I had an interview with a 2 attorney (2 partners in their early 70s) firm and I thought the interview went well – I believe that I impressed them with my legal knowledge and skills. However, I did not get the position. They advised me that they were looking for less of a lawyer and more of a business person. What am I doing wrong?

Response:

I help many of our law firm clients hire lawyers for associate and lateral positions as well as search for merger candidates. One of my favorite questions is – are you more of a lawyer or a business man or woman. Small firms are more often than not looking for candidates that are both. In a small firm you must be able to bring in clients, manage people (clients, lawyers, and staff), and perform quality legal work. There are a lot of good lawyers available on the market – there are less good lawyers that are also good business persons.

I suspect that the firm you interviewed with is looking at this hire to be part of the firm's succession strategy and the partners are looking for a lawyer/business person that can carry the firm to the next generation of practice.

Next time you interview with a firm in a similar situation – blend in a discussion of business topics as well. Even though you are a solo doing contract work you can still share some business experiences. You have had to bill for your services, manage your receivable and payables, market yourself and your practice, etc. Share your thoughts.

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

 

Jan 14, 2014

Law Firm Administrator/Business Manager – Essential Skill Sets

Question:

Our firm is an eight attorney firm located in Minneapolis. We have 5 partners and three associates. I serve as the managing partner and frankly I do not have the time or the skills to do an effective job. My performance as managing partner is marginal at best. We have recently been discussing hiring a professional legal administrator to manage the firm. What are the essential skill sets that we should be looking for?

Response:

Larger firms that have several administrators/managers can have the luxury of having specialists – for example a HR manager, a IT manager, a Marketing Manger,  a Finance/Accounting Manager, Executive Director, etc. In a firm your size you need a hands-on generalists that can perform all of these roles. The top three skill sets that you should look for are:

  1. Accounting/Bookkeeping/Financial Analysis Skills
  2. Human Resources – especially leadership and strong interpersonal skills
  3. Marketing

I would look for someone with 5 years or more experience in managing a law, CPA, or other professional services firm and a B.S or B.A. degree in business, management, or accounting.

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

 

Sep 24, 2013

Law Firm Administrator/Business Manager – Establishing Presence & Earning Respect

Question:

Our firm is a 8 attorney firm located in downtown Chicago. We have just hired our first administrator/business manager and he starts in two weeks. We are concerned that we get started on the right foot so our experience is successful. Any thoughts?

Response:

Relationship With Partners

On the first day of employment with the firm, the administrator must begin to develop a relationship with the firm’s partners that is based upon need, understanding, credibility and trust.

Governance Plan

Business management in many law firms suffers from decision-making paralysis — in other
words, helpless inactivity and the inability to act decisively. Lack of effective implementation of decisions is also evident. The result: missed opportunities and a deteriorating competitive position in the legal marketplace. Administrators who can be proactive and turn this situation around will be off
to a good start to solidifying their positions in their firms.

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

 

Sep 10, 2013

Handling Law Office Staff That Can’t Get Along

Question:

I am the managing partner in an eight attorney firm in Chicago. We are having problems with office staff members getting along. Office conflict is rampant. Any suggestions?

Response:

You should begin by identifying some of the causes. Poor communications often can be the root cause of such problems. Interview each of your staff members individually and probe. What do they think? Is communications a problem? Are roles, duties, and responsibilities clarified? Lack of clarity can in these areas can lead to turf wars. You may want to design job descriptions for each employee and clarify roles, duties, and responsibilities for each employee. Conduct short weekly staff meetings to enhance communications. Use agendas. Take and publish notes of the meetings. Advise everyone of your expectations including all members working together as team members. Let them know that working together as a team is a performance factor that will be considered in performance evaluations and reviews. Conduct periodic performance reviews. Counsel and take action against problem employees.

Maybe it is time to hire a firm administrator of business manager and let them deal with it.

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

 

Aug 20, 2013

Law Firm Associate Performance Evaluations

Question:

I am the managing partner of an eight attorney firm in Central Illinois. We have five partners and three associates. Over the years we have experienced excessive associate turnover and have had problems retaining associates. While we believe that we provide adequate feedback to our associates regarding our expectations and their performance in real time and in their annual reviews several of my partners believe that we can do better. I would appreciate your thoughts and suggestions.

Response:

One of the most frequent complains I hear during interviews with associates in law firms of all sizes is lack of specific detailed feedback, unclear or non-existent expectations concerning their performance and future career progression, and vague informal performance reviews.

Here are a few suggestions:

  1. Institute a system where associates, especially when they are new, have a chance to work with all of the partners in the firm.
  2. As managing partner solicit feedback from your partners and meet monthly with each associate and discuss their performance during their first two years of employment with the firm.
  3. Annually conduct formal performance reviews with each associate. Before the review obtain specific feedback from each of the partners and have each partner complete a written review of each associate using the associate performance rating form. Ask each associate to conduct a self-evaluation using the firm's associate performance rating form and then conduct a detailed review with each associate. The review should be detailed and specific and should be developmental with specific goals and timelines established. Document the review in the associate performance rating form.
  4. Consider developing an associate career progression program (partnership track) and committing it to writing. The program should outline the timeline for first consideration for partnership, competencies and performance factors, what partnership means in your firm, how an associate becomes a partner, buy-in or capital contribution requirements, voting, etc.
  5. Be honest and open with your associates – don't try to be Santa Claus – tell them the truth, have the difficult discussions, and make the tough calls. Be accessible.

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

 

 

 

Jul 30, 2013

Impact Of Law Firm Growth Upon Management and Organizational Structure

Question:

Our firm is a five attorney firm in Peoria, Illinois – three partners and two associates with four staff members. One of our legal assistants wears two hats – she serves as our office manager and also performs legal assistant duties for clients. Three years ago we had two attorneys and two staff members. We are feeling the consequences of our growth – our caseload has increased by 200%, our overhead is much higher and even though we have greater revenues – our take home earnings is less. We are overwhelmed. I would appreciate your thoughts?

Response:

It sounds like your firm has outgrown your management (organizational) structure. A firm with nine people is a different firm than a firm with four people. You are at a difficult size – large enough to feel the pains and challenges of being larger than two attorneys and two staff members but not large enough to reap the organizational benefits of a larger firm such as a full-time firm administrator, accounting manager, HR manager, etc. (I believe that as a law firm grows – management gets harder until a firm gets to around 12 attorneys – then as the firm begins to put in place a management team – it gets easier.)

In the meantime you might want to consider the following:

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

 

 

 

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