Profit-Ability: How to Scale and Manage Your Law Firm
Feeling overwhelmed, overworked, and maybe just a little bit out-of-control?
If you went to law school, and you manage a law firm it is not uncommon for you to struggle with the business of running a law firm. Many people in your position feel that way.
We sat down with three of the world’s leading law firm management coaches to discover their top strategies for managing the law firm:
John McCarthy – Profit Coach at Business Academy
Richard James – Attorney Business Management Consulting
Jay Berkowitz – Founder and CEO – Ten Golden Rules
John McCarthy, Profit Coach at Business Coach Academy, says “the legal business can give you a fantastic lifestyle, if you run your firm like a business. Successful law firm operators are not tied down to their job, they can create a firm that runs itself and they can take long vacations without missing a beat.”
Here are the five pillars of running a successful – AND PROFITABLE – law firm.
- Run your firm like a business
Law firms have to run like a professional business.
A law firm is a business just like any other. It needs efficient processes, good leadership, proper marketing and core values to function. Richard James said it best – “Systems should run your law firm and people should run your systems.”
Contrary to what most lawyers are conditioned to believe, you can’t replace efficiency with brute force. As a young lawyer, the path to more income was working more billable hours. As a successful business owner you need to implement effective, repeatable systems that everyone in the company understands and buys into.
We recommend EOS (Entrepreneurial Operating Systems) books “Get a Grip” for business founders and “Traction” for the operations people for strategies to run your firm like a business!
- Have a strategic plan, an agreed-upon focus, and get buy-in
When you narrow your annual and quarterly priorities down to the top 5 most important, and your team buys in, everyone is aligned and your firm is aimed toward success. It’s important for everyone to be on the same page and know what goals they’re working towards, and how to get there.
As a company, hold a brainstorm meeting every quarter to identify your Top 5 Priorities as a company and as individuals. Then, choose one top company-wide priority that must get done in the next quarter.
John McCarthy explained – “When the team are engaged, they’re the ones who will start to build the processes that work, because they’re the guys doing it hands-on everyday.”
- What gets measured gets attention (and improves)
You have to set precise, measurable and attainable goals in order to succeed.
Create a simple 1-page dashboard of the most important benchmark numbers to assess where you are at the starting point. Next identify your 1, 3 and 10 year goals for what your ideal numbers will look like. Track performance weekly, monthly and review and analyze the trends each quarter to see where you can improve and where you are succeeding.
Richard James, of Attorney Business Management Consulting, created a website that can be used to analyze the impact of small improvements on your firm’s performance. www.YOURPCLC.COM measures the scale with which small, incremental changes can impact your bottom line. These changes are, as Richard says, “the little hinges that swing the big doors.”
- Master Marketing
Investing in marketing your law firm – whether that be hiring an outside agency to handle your marketing, or investing time into learning techniques to do so yourself – is key to moving your firm towards success.
Ten Golden Rules has hosted over 25 Training (Click here to access the training library) to guide law firms through the business of marketing their firm and provide strategies they can implement to see results.
- Make it Rain
Rainmaking is a term for using relationships and networking to generate new business. In the field of law, a strong network of referring attorneys and trusted referral partners is a repeatable, and reliable strategy to grow your business. Those who trust you in a professional capacity will jump at the opportunity to recommend your services, and those recommendations hold weight for potential clients.
For instance, an attorney can refer business back and forth with an accountant. This relationship is mutually beneficial and should be fostered frequently.
As the owner of a law firm, it’s imperative to get everyone onboard with the concept of networking. Senior attorneys typically bring in about 80% of the business for the firm because of their established book of business – these attorneys should train the newer, younger attorneys in networking in order to position the firm for the future.
Most business owners know what they need to do to succeed, but don’t have the knowledge and/or bandwidth to implement changes. If you are struggling with the business of running your firm, please click here to view the entire webinar.
Need more guidance? Schedule a call with Jay today!