Law Practice Management Asked and Answered Blog

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Oct 17, 2018

The Focused Law Firm

Question: 

I am a member of a three-member management committee. Our firm is a twenty-five attorney firm located in the greater Washington D.C. area. We specialize in governmental law. We are feeling that our committee and the firm spends a lot of time in meetings discussing management problems, strategies, etc. to no avail. Not much changes or gets implemented. I welcome your comments.

Response: 

One of the major problems facing law firms is focus. Research indicates that three of the biggest challenges facing professionals today are: time pressures, financial pressures, and the struggle to maintain a healthy balance between work and home. Billable time, non-billable time or the firm’s investment time, and personal time must be well managed, targeted and focused. Your time must be managed as well.

Today well-focused specialists are winning the marketplace wars. Trying to be all things to all people is not a good strategy. Such full-service strategies only lead to lack of identity and reputation. For most small firms it is not feasible to specialize in more than two or three core practice areas.

Based upon our experience from client engagements I have concluded that lack of focus and accountability is one of the major problems facing law firms. Often the problem is too many ideas, alternatives, and options. The result often is no action at all or actions that fail to distinguish firms from their competitors and provide them with a sustained competitive advantage. Ideas, recommendations, suggestions, etc. are of no value unless implemented.
Don’t hide behind strategy and planning. Attorneys love to postpone implementation. Find ways to focus the firm and foster accountability from all.

Go For Bottom Line Results

Attorneys respect facts. The quicker your committee can implement solutions that have a positive financial impact on the bottom line the quicker the committee will gain credibility and respect from the other partners.

Use The Consulting Process

Treat the problem or issues like a legal matter engagement or project. Conduct appropriate research and back up ideas and recommendations with hard data. Adequately prepare and rehearse presentations. Prepare like attorneys prepare a case for trial. The management committee’s credibility will only be enhanced if its ideas are accepted and implemented with positive results.

Use of Triads – Present Three Alternatives or Options

Time after time management committees have spent endless hours studying and researching a problem, brainstorming solutions, preparing and presenting their recommendations to the partners only to have their report tabled and asked to present additional alternatives. What happened? The management committee failed to present three options or alternatives. The partners had no basis of comparison.

Experience and research shows that the success rate improves dramatically when three options or alternatives are presented. The triad strengthens thinking abilities enormously and empowers people in making choices. It also trains the mind to see the relationships between alternatives and options. Management Consultants never present just one alternative or option.

Management Committees that use triads and present three alternatives or options will be more successful in selling their ideas to their partners.

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

 

Aug 22, 2018

Law Firm Retreat Follow-up and Implementation

Question: 

I am a partner in a eighteen attorney firm in Milwaukee. Over the years our firm has held firm retreats, but the results have been disappointing – a lot of talk and little action. We have the same problem in our monthly partner meetings. We spend a lot of time in meetings – discussions and decisions made but little implementation. This week we are having a partner vote to decide on whether to have a retreat this year. Frankly, I will vote against it and I think it will be a waste of time. What are your thoughts concerning law firm retreats?

Response: 

I understand your frustration and concern. Many law firms have had similar experiences with retreats. Good ideas and decisions but no follow-up or implementation once the retreat is over. Often retreats are too loose with no structure or leadership.

Insure that the firm appoints a qualified retreat leader either from within the firm or someone outside the firm that has experience leading or facilitating retreats. Identify specific objectives and desired outcomes during the retreat planning phase and design in how follow-up and accountability for implementation will be achieved. Be sure you come away from the retreat with a specific plan for follow-up action on every problem discussed. For example, if you decide to start a talent search to fill specific position, or if you have assigned several partners members to work further on specific problems and report the results, it is important that individual assignments and target dates for reporting and completion be made explicit. Determinations of this kind should be recorded and made part of the minutes of the retreat. Further, a system of follow through meetings to assess progress is advised, in order to maintain the momentum achieved at the retreat.

Many law firms benefit considerably by incorporating specific retreat decisions into a twelve month plan and schedule of activities to meet firm objectives. Planning of this kind typically results in significant firm progress, even though there may be initial resistance to these efforts by some firm members.

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

Aug 15, 2018

Six Worries That Keep Law Firm Managing Partners Awake at Night

Question: 

I am a new managing partner in a thirty-five attorney firm in Tucson, Arizona. I replaced the previous managing partner who retired. He was the firm founder and had been in the position since the firm’s inception. I have had this position for six months and I am finding the job overwhelming – trying to serve my clients and managing the firm at the same time is very difficult. What are the major challenges that managing partners are having.

Response: 

I understand and appreciate your situation. Managing partners advise me that the following challenges are what keeps them awake at night:

  1. Managing cash flow. Investments in technology, higher salaries for attorneys and staff, and longer collection cycles are all having a negative impact upon cash flow. Contingency fee firms have additional cash flow challenges. Managing partners must insure that client bills are going out promptly, client payments are deposited promptly, and vendor bills are paid “just in time.” Cash shortfalls will have to be financed with additional partner capital contributions or bank loans.
  2. Satisfying hard to please clients. Institutional clients are demanding more from their law firms in terms of service offerings, geographical coverage, responsiveness, and fee arrangements. Law firms are finding that the market for legal services is a buyers market and that they must continually innovate in order to continue satisfying client demands. Many are conducting client satisfaction interviews with these clients in order to measure client satisfaction and identify needed improvement areas and new opportunities.
  3. Competition from other law firms and non-law firm service providers. The oversupply of lawyers, advertising, and the internet has increased competition between law firms. In addition to the competition between law firms, law firms also also facing competition from other service providers as well. Managing partners are finding they have to allocate more resources to advertising and marketing. Websites, internet search engine optimization, and pay-per-click internet advertising is becoming the norm for many firms.
  4. Getting new clients and keeping existing clients. Today clients are less loyal and more likely to switch law firms than in years past. Managing partners are having to work harder to retain existing clients and acquire new clients. Acquisition of new institutional clients often requires responding to request for proposals, bidding for engagements and projects, preparation of quality proposals, and making presentations to prospective clients.
  5. Succession and retirement of senior partners. Many law firms are experiencing a “bunching” of numerous senior partners approaching retirement at the same time. Succession and transition planning is critical to the continued success of these firms. Getting partners to openly discuss their retirement plans is a major challenge that managing partners are facing.
  6. Getting and retaining top talent. Acquiring and retaining top lawyer and staff talent is becoming more difficult and more costly for law firms. Even though there is an oversupply of lawyers on the market there is still a shortage of experienced lawyer talent in many practice areas. Lawyer search timelines and recruiting cost are on the rise.

 

 

 

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

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