Olmstead & Associates Law Practice Management Blog

Future Investments

Question: If a law firm could select only one area for future investment, where would you recommend that such investment be made?

Response: In their people – their intellectual capital. I am amazed at the minimal investment that law firms make in their staff. Law firms are in the knowledge business and their product is their intellectual knowledge. While law firms do invest in their attorneys, such is not the case with the staff. Although staff members are often on the front lines in dealing with clients, very few law firms are providing them with skill training in areas such as communication, marketing, client service, conflict management, effective writing and speaking, time management, computer applications, client complaint management, etc. By the way, attorneys need training in these areas as well. Why do law firms hire the cheapest talent they can find to fill the receptionist position when it is the receptionist who often has the initial contact with a new client. I find it amazing that firms spend huge amounts of money on advertising and marketing and they fail to invest in the other tools needed for effective new client intake. Small firms should consider assigning their receptionist the role of marketing coordinator with responsibility for assisting in the management of client relationships and the firm’s marketing program.

Firm Administrator Priorities

Question: I am a new administrator with my firm. I am also the first administrator that the firm has had. Do you have any suggestions as to where I should start? What are my priorities?

Response: As a first administrator you will face a dual challenge. You will have to justify the new position as well as yourself and your performance. You will be second guessed and partners will from time to time question whether a legal administrator was necessary or wise. There will be problems with role clarification. Suggest that you insist on a job description for yourself and a governance plan that outlines the authority and responsibility of the administrator, the managing partner, the executive committee, and the partnership. This will set the boundaries. On your first day at work suggest that you start by meeting with all of the personnel. Meet individually with the partners and associates and get to know them, their desires and hidden agendas. Initially conduct a get acquainted meeting with the staff and then meet with each staff member individually. Discuss their jobs and their duties. Ask for suggestions. Work with the bookkeeper and get up on the accounting operations as quick as you can. Learn the office computer system. Initially your two biggest priorities will usually be personnel and accounting. Read the minutes of firm meetings and office administrative files. If you are weak in accounting and computers obtain whatever additional training that is required. Join the Association of Legal Administrators and attend their meetings and conferences. Our firm provides skill transfer coaching and provides materials for new legal administrators as well.

5 Tips For Reinventing Your Practice

TIP #1: Develop a business mindset. Become an entrepreneur and learn how to think like a businessman. Look at the world from your client’s perspective. Consider you client your business partner.

TIP #2: Select your clients carefully. Establish client acceptance criteria. Learn how to say no. Dump undesirable clients.

TIP #3: Brand yourself. Look for was ways to differentiate yourself from your competitors. Become the only attorney that can do what you do. Make a decision - what do you want to be known and remembered for? Unique services, unique client groups, different service delivery strategy, personal style. Create a five-year plan for goal accomplishment.

TIP #4: Learn how to become “solutions orientated” and become a consultant to your clients as opposed to simply their attorney. Solutions may involve activities and services other than legal services. Think out-of-the-box and outside of typical frameworks in which you are comfortable.

TIP #5: Conduct a firm-wide management and leadership assessment and identify strengths and weaknesses. Enhance management and leadership skills through skill development training and personnel acquisitions.

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

Lawyer Coaching

Recently the following question was submitted to our Ask and Answered section of our website:

When should a firm consider coaching for attorneys?

The day-to-day stress of practicing law and serving clients leaves little time for focusing and investing in the future of the firm. When attorneys exhibit the following it may be time for a coach:

§         Stuck and unable to move forward on new initiatives
§         Indecision paralysis.
§         Lack of commitment, inertia, self-accountability or follow-up
§         Poor implementation skills
§         Lack of management, leadership, interpersonal, or other needed skills.

Training and skill development is not easy. Studies reveal that 90 percent of the people who attend seminars and training sessions see no improvement because they don't take the time to implement what they learn. Practices create habits and habits determine your future. Up to 90 percent of our normal behavior is based on habits. The key to skill learning is to get the new skill to become a habit. Once the new habit is well developed it becomes your new normal behavior. This requires practice. Unfortunately, attorneys do not have time to practice and experiment.

The coach's role is that of steward, facilitative leader and teacher. Law firms retain coaches to work with attorneys and staff, mostly on a personal level, to address problems involving lack of commitment, inertia, implementation, self-accountability and follow-up. Firms are using coaching in the following areas:

• Business planning.
• Marketing. Improving performance.
• Organizational skills.
• Firm leadership.
• Achieving balance between work and personal life.
• Clarifying values and goals.

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

Firm Culture

The following questions was recently submitted for comment:

Question: I often hear the term firm culture used. What does this term mean and what impact does it have upon management of a law firm?

Response:

Firm culture is the part of the firm’s internal environment that incorporates a set of assumptions, beliefs, and values that organizational members share and use to guide their functioning. Is a pattern of shared values and beliefs giving members of a firm meaning and providing them with rules for behavior. These values are inherent in the ways organizations and their members view themselves, define opportunities, and plan strategies.

Much as personality shapes an individual, organizational culture shapes its members responses and defines what an organization can or is willing to do. Click here for link to full article

Plans and Goals For 2007

As we approach the Christmas holiday season we need to begin thinking about next year. Here are some suggestions:

• Take a serious look at the firm's present position in the marketplace. Review financials, compare against financial ratios, compare with both firm past history and against law firm benchmarks. Examine how well the firm is competing. Is the firm too dependent on a narrow base of clients? Is the practice at risk? Conduct a client survey and obtain client feedback both on firm performance as well as possible unmet needs and opportunities. Consider a comprehensive management review.
• Formulate business goals and develop a strategic business plan as a roadmap for the future.
• Design and simplify business reports designed to measure the goals identified in the strategic business plan. Strive for a one page summary as the primary report. Require all timekeepers in the firm to submit personal one page business plans which in addition to outlining goals for the year provided fee revenue goals with an element of stretch. The goals should have a stretch component but yet be realistic and attainable. These plans should be approved by the Executive Committee, Managing Partner or the Partnership.
• In all of our client engagements we typically discover that the root cause of most problems is poor internal and external communications. Poor client service, staff competency and morale, interoffice conflict, and client defections typically can be traced back to poor communications. Work on improving internal communications with firm personnel and external communications with clients and prospective clients. Yes, you have to have meetings now and then. Devise systems to improve communications and implement properly. If a meeting is required - conduct it properly, use agendas and take minutes. Use your email systems. Match the richness of the communication method with the nature and depth of the message to be communicated.
• Improve relationships with your clients. Lack of responsivenesshas is the number one reason for client dissatisfaction.
• Find ways to focus the firm and foster accountability from all.
• Undertake a few projects at a time that can be realistically accomplished. Delegate tasks across the firm. All firm personnel should have marketing responsibilities - from the receptionist to the senior partners and everyone else in between. Databases must be maintained, newsletters and articles written, presentations given, clients to be wined and dined, etc. There is work for everyone.
• Law firms must adopt management structures that enables the firm to act decisively and quickly. Structures that do not support such a culture must be replaced.
• Come to grips with the fact that times are changing and law firms are going to have to change and reinvent their firms dramatically in the next few years.

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

Marketing Idea For 2007

Our firm recently completed client satisfaction interviews for several of our insurance defense law firm clients. Here are a few quotes and a summary of what these insurance company law firm clients told us:

• We want to work with proactive attorneys that aren’t afraid to try cases.
• Limit the number of people working on a file. I like consistent assignments.
• I expect attorneys to get back to me by the next business day.
• I like one partner and one associate per file.
• Most of our billing issues with law firms is due to excessive use of associates time. 
• I get upset with attorneys that want to settle right before trial.
• The primary reason that we terminate our relationship with our outside attorneys is not reporting to us in a timely fashion and poor communications.
• I find that many lawyers are poor at managing their files and have poor basic communication skills. I work with lawyers that can do both of these things well.
• I think that it is important that law firms provide value added services such as newsletters, legislative updates, e-alerts, seminars, etc on a “no charge” basis. These services are provided by most law firms these days. Such services help us do our jobs better, improves communications and the overall relationship between our organization and the law firm, keeps us up to date on changes in the law, and helps the law firm stay abreast of emerging needs in our business.
• I will pay higher fees to lawyers that aren’t afraid to try cases.

Much can be learned by talking to your clients. Structured telephone interviews conducted by a neutral third party can provide many surprises as well as answers. Client satisfaction interviews can be the best marketing investment that you can make.

I had a call today from a lawyer expressing the following frustration:

I have been practicing law for ten years and I feel that I am in a rut. I am working for a firm and the relationship is no longer working out for me. I don’t have enough time for my family. My kids are growing up fast and I don’t have enough time to enjoy them. I need to make a change. Where do I start?

I provided him with the following suggestions:

A balanced personal and professional life is becoming more important to everyone. Time is a precious commodity. You should:

Develop a personal life plan and career/practice business plan.

Develop skills in time and money management.

Define what is important to you and define your personal-professional life boundaries.

Enjoy life and get involved in activities other than the practice of law.

Take charge of your quality of life – it is your responsibility.

Obtain training in the business of law.

Become entrepreneurial – think like a business person.

Begin by conducting an inventory of your personal and professional life. Start with your personal life. Identify your personal and family goals. Then move on to your professional and career goals. Develop both a career plan and a business plan for your practice. Some of the decisions that you will have to consider are:

Should you go with another firm or start your own practice?

Should you work for a large firm or small firm?

Should you go to work for a corporate law department or a governmental agency?

Do you need additional training or education? Should you get a LLM or a MBA?

Where do you want to work?

What type of work and working environment will make you passionate about your work?

For whom do you want to work? What type of law firm? What type of clients?

Do you want to be a partner in a law firm?

How much of a balance do you want to maintain between your career and home life?

How important is money? How much do you want or have to make?

Once you have defined your personal and professional goals you can formulate your action plans as to how you will get there and incorporate them into to career/business plan.

John W. Olmstead, Ph.D, CMC

Tips On Getting Paid

I  have seen more law firms and other business firms destroyed by poor cash flow than any other calamity. Cash flow is what keeps owners, partners and administrators awake at night. Many of our law firm clients have asked us for tips on getting paid. Here are some thoughts and suggestions.