Law Practice Management Asked and Answered Blog

Category: Human Resources

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Sep 28, 2010

Dealing with Difficult – Maverick Partners

Question:

Our firm has been discussing how to handle one of our partners. We are are 25 attorney firm. One of mid-level partners who is one of our highest fee producers and best business getter's simply won't follow firm policy or play by the rules. He won't turn in time-sheets in a timely manner, he is argumentative with others in the office, and not a team player. He is "me first" while the rest of the partners in the firm are mostly "firm first". We are trying to build a team based practice and this one partner is holding up our progress. Do you have any thoughts or suggestions on how we should handle this?

Response:

Dealing with "maverick partners" is always a challenge. Of course they seem to always be the heavy hitters and this makes it that much more difficult as often there are major clients and large sums of money at stake – at least in the short term. This can also be major issues and large sums of money at stake in the long term if you don't deal with the maverick partner as well. In addition you won't be able to achieve the vision and goals the firm is trying to achieve.

Many firms have had to deal with the problem of a maverick "huge business generator" who just wouldn’t cooperate with firm policies and caused conflict and tension in the firm.  It is an unplesant task – but in the end – worth the investment. In the end he or she either conforms or leaves the firm. We have been advised by our clients that even though they may have struggled in the short term as the result of the loss of a major fee producer – in the long run the firm was better off and should have done it earlier.

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

 

Sep 14, 2010

Characteristics of Successful Law Firms – Basic Building Blocks – Block 4 – Partner Compensation

For the past three weeks I have been discussing the characteristics of successful law firms and introduced the following basic building blocks that successful firms typically have in place:

Partner relations, leadership building, and management blocks have been discussed. 

The fourth basic building block is partner compensation. Successful firms have a good partner compensation in place. Partners frequently advise us in confidential interviews that they are more dissatisfied with the method used to determine compensation than with the amount of compensation itself.

How much and how partners are paid are probably the two most challenging management issues that law firms face. Many law firms are struggling with compensation systems that no longer meet the needs of the firm and the individual partners. Failure to explore alternatives to failing systems often result in partner dissatisfaction leading to partner defections and disintegration of the firm.

In many law firms compensation systems have been counter-cultural and failed to align compensation systems with business strategies. As more law firms move toward teams many are incorporating new ways to compensate partners in order to develop a more motivated and productive workforce. Team goals are being linked to business plans and compensation is linked to achieving team goals. Such systems reinforce a culture that significantly advances the firm’s strategic goals.

People tend to behave the way they're measured and paid.

What gets measured and rewarded – is what gets done.

However, be advised that compensation does not drive behavior – it maintains status quo. Motivation requires leadership which can have a greater impact upon a firm than anything else.

Compensation systems should do more than simply allocate the pie – they should reinforce the behaviors and efforts that the firm seeks from its attorneys. Many firms are discovering that desired behaviors and results must go beyond short term fee production and must include contributions in areas such as marketing, mentoring, firm management, etc. to ensure the long term viability of the firm.

Click here to read my article on the topic

I will address each of the other building blocks in upcoming postings.

John W. Olmstead, MBA, Ph.D, CMC
www.olmsteadassoc.com

 

Sep 08, 2010

Characteristics of Successful Law Firms – Basic Building Blocks – Block 3 – Management

For the past two weeks I have been discussing the characteristics of successful law firms and introduced the following basic building blocks that successful firms typically have in place:

Partner relations and the leadership building blocks have been discussed. 

The third basic building block is management. Successful firms have a good governance and management structure in place and effectively manage the firm. A major problem facing many law firms is the lack of long range focus and the amount of partner time that is being spent on administrivia issues as opposed to higher level management issues. Time spent in firm governance and management, if properly controlled, is as valuable as, if not more valuable, than the same time recorded as a billable hour. (client production time)

There is a difference between management (governance) and administration.

Partners and law firm owners should be focusing their time on the management issues rather than administration.

Management includes:

  – Productive activities, including those of individual lawyers and the firm as a whole.
  – Quantity, quality, and economic soundness of the work.
  – Development of lawyers and future leaders of the firm.
  – Formulation of policies that will determine the firm’s character
  – Financial planning, both short-term and long-range.
  – Marketing and business development.
  – Partner compensation and profit distribution systems

  – Other decisions requiring partner approval

Almost everything else is administration.

Hire an office administrator, manager or assistant for the administrivia matters so the partners can focus on the management concerns of the firm.

I will address each of the other building blocks in upcoming postings.

John W. Olmstead, MBA, Ph.D, CMC
www.olmsteadassoc.com

 

 

 

 

 

Almost everything else is administration.

Hire an office administrator,office manager or assistant for the administrivia matters so the partners can focus on the management concerns of the firm

I will address each of the other building blocks in upcoming postings.

John W. Olmstead, MBA, Ph.D, CMC
www.olmsteadassoc.com

 

 

 

 

  

 

 

Aug 31, 2010

Characteristics of Successful Law Firms: Basic Building Blocks – Block Two – Leadership

Last week I discussed the characteristics of successful law firms and introduced the basic building blocks that successful firms typically have in place. These are:

Last week we focused on partner relations as a core foundational building block.

The second basic building block is leadership. Successful firms have good leadership in place. This may be a single individual or a core group of individuals. Leadership does not always come from the formalized management structure of the firm.

Leadership is one of the major problems facing law firms. Leaders are needed for managing partner posts, executive committee chairs, and practice group heads.  

Leadership behaviors include:

Leadership skills will need to be included in compensation systems.

Seven traits of effective leaders include:

  1. Make others feel important
  2. Promote a vision
  3. Follow the golden rule and establish trust
  4. Admit mistakes
  5. Criticize others only in private
  6. Stay close to the action
  7. Walk the talk.

Leadership is what makes things happen and propels the firm forward, facilitates new directions and attainment of strategic goals, and provides the firms the resiliency needed in today's challenging competitive climate.

Law firms without leadership are easy to spot. They are the firms that are "stuck-in-a-rut", unable to reach agreement or concensus on new ideas, stagnating profitability, partner defections.

Firm must pay attention to this key area and develop leaders for all roles mentioned above.

Click here to read my article on leadership

I will address each of the other building blocks in upcoming postings.

John W. Olmstead, MBA, Ph.D, CMC
www.olmsteadassoc.com

 


 

 

Aug 23, 2010

Characteristics of Successful Law Firms: Basic Building Blocks – Block One

Question:

My partner and I just started our firm two years ago. We have one associate attorney and one staff member. As we grow our firm what should we keep in mind so we don't repeat some of the mistakes that I have seen in other firms that have not been successful?

Response:

I often refer to what I call the Basic Building Blocks of Successful Law Firms which are:

Lets take the first one – Partner Relations. This is the foundation (bedrock) of a successful firm. A successful firm has a healthy partner culture – a good marriage. In such a culture partners share common vision and purpose, respect one another, shoot straight with each other, and have difficult conversations and discussions when needed and deal with issues and problems. In many firms this is not the case and these firms often are characterized by the following:

Such firms are often doomed from the start. Firms that don't get this foundational building block right will build a firm on a shaky foundation. Before forming a partnership – go slow and get to know the other lawyer or lawyers and insure that the marriage makes sense, that you share similar goals and values, that you will be compatible, and you will be good partners. Once you have made the commitment – communicate, communicate, communicate and deal with issues in real time.

I will address each of the other building blocks in upcoming postings.

John W. Olmstead, MBA, Ph.D, CMC
www.olmsteadassoc.com

 

Jul 15, 2010

Getting Control of the Financial Side of Your Law Practice

Question:

I am a partner in a 14 attorney firm. Our bookkeeper has been with us for 20 years. We have a time and billing system, a separate bookkeeping system, and a separate database for clients, and something else for trust accounting. The other partners and myself do not know the name of the software that we are using, don't know how to access the software, and we have to ask the bookkeeper for any financial information that we require. We feel like "hostages". She gets offended when we ask questions. When we do receive information we don't know how to read or interpret much of the information. How can we get control of our firm back?

Response:

It is imperative that owners and partners in a law firm have access to financial information on a timely basis, understand the information, and use the information in a proactive way to manage the practice. We suggest:

The owner (or an appointed partner(s) in larger firms) obtain detailed training on the accounting software system(s) along side the bookkeeper when the system is implemented. In addition to general operation of the software, special training should also be obtained on intepretation and use of the management reports.

In your current situation – this may be a good time to consider upgrading your system and at that time obtain training on the new system, review the roles of all parties, and current procedures.

Insure that you have accounting controls in place and appropriate segregation of accounting duties.

Outline your expectations and requirements of the bookkeeper, meet with her/him, and communicate appropriately.

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


 

    • Sep 30, 2008

    Communication Skills

    Question:

    We are a 17 attorney IP firm in the Southwest and I am the managing partner. We are having a lot of problems with poor attitude in the office, inadequate production, employee turnover, and we have recently lost a few key institutional clients. I believe that the core of our problem may be poor communication skills on the part of our attorneys? What recommendations do you have?

    Response:

    Poor interpersonal communications is often the root cause of many of the management problems that arise in law firms. Here are a few ideas for improving interpersonal communication skills:

    1. Develop a series – a repertoire – of oral communications styles as well as languages to use in various situations with clients, colleagues, and employees.
    2. Understand and manage your clients expectations – (1) clients true objectives for the engagement, (2) the boundaries of your role, (3) kind of information you will use, (4) your role in the engagement and the role of your staff, (5) the product/service you will deliver, (6) what support and involvement you will need from the client, (7) time schedule, and (8) frequency and form of communication.
    3. Employ effective listening techniques with your clients – (1) client face-to-face engagement debriefings, (2) client satisfaction interviews – third party, (3) client site visits, (4) opinion surveys, (5) feedback questionnaires, and (6) client panels/focus groups.
    4. Employ effective office communications systems to faciliate communications with your employees – (1) weekly/monthly staff meetings with agendas and minutes, (2) satisfaction surveys, (3) daily meeting with your assistant, (4) performance reviews tied to a performance management approach.
    5. Match communications complexity to appropriate communications vehicles (face-to-face, telephone, e-mail, memo, letter, voice mail, etc.) Example: Use face-to-face to counsel or critique employees – not e-mail.
    6. Reduce communications noise – (1) setup MS Outlook not to automatically download e-mail, (2) put cell phones on silent, (3) develop cell phone protocols, and (4) use voice mail effectively.
    7. Incorporate the six client service principles into your daily behavior – (1) feel good about yourself, (2) practice habits of courtesy, (3) use positive communication, (4) listen and ask questions, (5) perform professionally, and (6) under promise and overdeliver.
    8. Develop written job descriptions and office policy and procedural manuals.

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

    Jul 15, 2008

    How Large Should a Law Firm Be When It Is Time to Hire an Administrator

    Question:

    How large should a firm be when it is time to hire an administrator?

    Response:

    There is no magic size. We just completed an engagement recruiting an administrator for a seven attorney firm. We also have law firm clients with over 40 attorneys that don’t have an administrator. I believe that an administrator, or office manager, is appropriate in firms of all sizes. It is a matter of attitude and commitment on the part of the partners and whether they are willing to delegate responsibility and authority to an administrator to run the day-to-day operations of the firm. The firm should start with a job description and then decide whether the firm is willing to delegate responsibility and authority. If not, the firm should not hire an administrator.

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

    Jun 29, 2007

    Skill Requirements for Office Managers/Bookkeepers in Small Law Firms

    We are often asked about skill requirements for office managers/bookkeepers in small law firms. (Six attorney and under firms) Many law firms in the six attorney and under size have shared with us their frustration in staffing the billing and accounting function. Often their investment in computerized billing and accounting systems fails to yield desired results due to poor accounting and management skills. Many small law firms assume that legal secretaries also have requisite accounting and management skills. Our experience has been that often this is not the case. Training, skills, and work behaviors are often different. Bookkeepers/accountants and secretaries are different animals. Many small firms are better off creating a accounting/bookkeeping position and staffing the position with a qualified bookkeeper/accountant. For many firms under six attorneys that have fully automated the billing and accounting function and have distributed time entry, this is not a full time position. In such instances many firms have either recruited a part-time bookkeeper/accountant solely for the accounting function or have created a combined position of office manager/bookkeeper. This justified a full-time position. Look for the following skills when evaluating candidates. Professional training in bookkeeping and accounting fundamentals as well as management principles.

  • A basic bookkeeping class should be a minimum requirement.
  • While a college degree should not be a requirement for the small firm, some college courses in accounting and management is desirable.
  • Two years+ prior experience in a bookkeeping/accounting position in a professional services firm such as law, accounting, consulting, etc.
  • Prior experience in a law firm bookkeeping/accounting position is desirable.
  • Experience with computers and accounting software as well as spreadsheets. On hands experience with the accounting software that the law firm uses is a plus. However, this is often not possible.
  • Prior office management experience in a law or other professional services firm if this is to be a combined position.
  • Detail orientated
  • Professional and able to deal with multiple demands, multiple masters, and the politics of a law office.

    • May 15, 2007

    Problems With Office Staff Getting Along

    Question: I am the managing partner in a three attorney firm and am having problems with office staff members getting along. Office conflict is rampant. Any suggestions?

    Response: You must 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 minutes 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. John W. Olmstead, MBA, Ph.D, CMC

     

     

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