The Happy Lawyer's Guide to Running Your Firm like a Business

The Happy Lawyer’s
Guide to Running Your
Firm Like a Business
Ann M. Guinn
G&P Associates

1Scaling New Heights 2014
9 Keys To Running Your Firm Like A
Business
1. Have a vision for your practice
2. Do a great job with your billings
3. Monitor your financial situation on a regular basis
4. Create new profit centers and maximize existing profit
centers
5. Leverage technology
6. Grow your firm
7. Rid yourself of underearning behaviors
8. Invest in your business
9. Develop a culture of thinking and working smarter and
strategically

Have a vision for your
practice
9 Keys To Running Your Firm Like A Business

• Where do you want to go?
• How will you get there?
• Who will help you get there?
• How will you measure your success?
• Where are you now in relation to your goals?
1 – Have a Vision for your Practice

Do a great job with your
billings

2 - Do a great job with your billings
Get Your Billing Rates Right
Target Revenues
÷
(Billable Goal X Realization Rate)
=
Minimum Hourly Rate

Monitor your financial
situation on a regular
basis

3- Monitor Your Financial Situation
• Realization rate
• Effective rate
• Overhead (% of revenues)
• Actual expenses vs. budgeted expenses

3- Monitor Your Financial Situation
l How to increase
– Case and client selection skills
– Advance fee deposits
– Stated and enforced collections policy
– Good communication with clients

Create new profit
centers and maximize
existing profit centers

• Make better use of existing employees by training to new
revenue-producing skills
• Add services or practice areas that are frequently requested by
your clients
• Leverage your practice with paralegals and contract attorneys
• Analyze the profitability of your current profit centers and look
for ways to maximize them through additional marketing, cross-
selling to your clients, and streamlining for improved efficiency
4 – Create new profit centers and maximize existing profit centers

• Create an extension of your existing business or create a new
business that can operate using your practice’s infrastructure
and that can be operated at the same time as the original
business.
• Business Advisor
• Alternative income streams
• eBooks
• Paid workshops
• Paid speaking engagements
• On-line legal services
• Unbundled legal services
• Inventory your existing employees for additional skills and
talents. Helps reduce dependence on third-party providers.
4 – Create new profit centers and maximize existing profit centers

Leverage technology

5 - Leverage Technology
• Increases productivity
• Capture more billable time
• Reduces the need for costly support staff
• Frees up time to work on marketing activities or
more billable work
• Saves time by helping you find things quickly
• Keeps everything related to a client’s file organized

5 - Leverage Technology
• Enables you to develop systems for increased
efficiency to keep things from falling through the
cracks and to insure that every client has the exactly
the same experience with your firm
• Allows you to work from anywhere
• Makes others more efficient
• Improves client communication (client portals) and
client satisfaction (faster turnaround time)

Grow your firm

6 - Grow Your Firm Strategically

Go back to your goals – what do you need to do to
achieve them?
• Alliances
• Virtual employees
• On-site employees
• Marketing consultant
• Outsourcing

How to recognize opportunities
• What do your clients ask for that you don’t currently
provide?
• What do other attorneys provide that your clients could
benefit from?
• What opportunity has presented itself in the last 30 days
and how did you respond?
• Ask your staff what other services you could provide. They
hear things from clients that you’ll never hear.

Rid yourself of
underearning behaviors

7 - Rid yourself of underearning behaviors
Underearning is earning below your potential
or your needs
Passive underearning – choosing not to do something, or failing
to do something, that would have resulted in you making
more money
Active underearning – Knowingly doing something that will
cause you to underearn

Examples of behaviors that cause attorneys to underearn
(abbreviated list):
• Undervaluing your work
• Giving away time
• Failing to capture all billable time
• Discounting fees
• Procrastination
• Disorganization
• Lack of business planning
• Failure to market, or reliance on inappropriate marketing strategies
• Rationalizing low income
• Not working enough hours
• Accepting bad cases/clients

Common Underearning Behaviors
• Undervaluing your work
• Giving away time
• Failing to capture all billable time
• Discounting fees
• Procrastination
• Disorganization
• Accepting bad cases/clients
• Failure to market appropriately

Invest in your business

8 - Invest in Your Business
• Spend money on things that will help generate more
revenues (technology, consultants and advisors,
training, highly skilled employees, etc.)
• Avoid looking at every penny out of pocket as an
expense rather than investment.

Develop a culture of
thinking and working
smarter and strategically

9 - Develop a Culture of Thinking & Working Strategically
• Choose one area where you can begin
• Develop an action plan to help you achieve your
goals
• Put the action plan in writing and refer back to it
regularly
• If you assign responsibility for an action to someone
else, indicate a deadline for that action, and ask for
periodic updates.
• Do something to move you toward your goals every
day

In Summary
Complacency isn’t an option in a global
economy, and maintaining a small, well-tended
geo-specific service region is no guarantee that
a competitor won’t move in across the street
(or on-line), undercut your prices, and undo 10
years of hard work in a few months.

In Summary
• Treat your practice as a business
• Make sound business decisions
• Follow a plan
• Monitor your firm’s situation daily
• Benchmark your progress
• Readjust, as necessary
• Enjoy the fruits of your labors

Thank You!
Ann M. Guinn
G&P Associates
(253) 946-1896
ann@annguinnconsulting.com

The Happy Lawyer's Guide to Running Your Firm like a Business

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