As the CEO of NexFirm, I watch from the cheap seats as my clients around the country brave the trials and tribulations as law firm entrepreneurs. I see the good, bad and the ugly of law firm management. Our clients are corporate practices with experienced attorneys that have AmLaw 250 pedigree. They grow quickly and are quite profitable. Even though they are the elite of the industry, they have their challenges.
1) Biz development works- for everyone. It's a simple formula- time and energy yield results. Those who cop out with "I am not good at it" hurt themselves professionally, and needlessly.
2) Bad hires eventually come back to bite you. When my clients lose a great employee, we typically decide that the reason is poor communication that occurred back when they were hired. Being thoughtful about compensation, and creating a career path for all on your team is your primary job as a law firm partner.
3) Partners should "re-marry" every few years. I see too many successful practices break up because of disputes that could have been avoided. To avoid these challenges, we encourage partners of new firms to talk exhaustively about expectations. Time is the enemy of the understandings they arrive at before the launch of the firm. It is important to sit down periodically and check in on goals, expectations, and perceptions of partners as they relate to the practice.
4) If you are not hosting events, you are crazy. There is no better return on investment than an event that puts you in a room with your clients. Host a lunch or dinner. Take a group to a ball game. Present a CLE. Just get yourself belly to belly with your clients. The results will please you.
5) Don't ever say no to a new matter; but use price to make it worthwhile. If you like matter but are not sure about the client, increase your rate instead of passing. And get paid in advance. My clients are rarely correct when they pick and choose, and at least when you are unpleasantly surprised, you get paid for your time.
6) Don't ask, don't get. Insurance carriers said yes to price increases from clients who haven't seen them in years, because they asked. Be sure to increase your rate every year, or at least try.
7) Retainers are easier than collection agency. The amount of time that is wasted trying to collect unpaid bills is astonishing. Do the hard work up front, and don't waste your time if you are not going to get paid. The time you save not doing unpaid work can be used in wonderful ways that will improve the success of your firm.
8) Trees don't grow to the sky. When things are good, build up your cash- as there is always a possible down cycle is coming. A strong balance sheet, both personally and at the firm, can make the difference when the slow times inevitably arrive.
9) If there is one thing that might put your law firm out of business overnight, it is a data breach. Spend what is costs to be on the leading edge of data security. You don't want your reputation hurt by this.
10) Make your team a top priority. Employees leave when they feel they are not valued. When you have a resignation, will you ask yourself what could have made the difference? A gift card, a dinner, a pat on the back, or any sort of acknowledgement that would make them feel that their contribution is meaningful.
With half of 2018 still ahead of us, there is still time to focus on improvement and make this year the most successful your firm has ever had. Just remember, doing the same thing over and over again and expecting a different outcome is the definition of insanity.
David DePietto is the founder and CEO of NexFirm. He can be reached at firstname.lastname@example.org