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Your Law Firm: A Vehicle For Entrepreneurial Success

by Warren Coughlin

As an owner or partner of a law firm, you simultaneously occupy three important positions within your organization: the entrepreneur, the manager, and the professional. The entrepreneur is the visionary, the one who is always looking to the future and asking the questions "What if…?" and "How can we…?" The manager has a perspective that is more historical, examining successes and failures and asking the questions "What happened…?" and "Why?" The professional tends to live in the present, reacting to the daily demands of the practice.

Balancing these three roles is a difficult challenge, the importance of which is often overlooked in the hectic day-to-day delivery of services to clients. If you are similar to most owners/partners, you are likely spending a disproportionate amount of your time in the position of professional and overlooking some of the opportunities that could be unearthed by focusing a bit more on the other positions. It is my intention to provide an overview of where some of these opportunities may be found and then examine them in greater detail in future articles. To get the most from this overview, I invite you to think of your firm as a business that provides legal services and of yourself as the owner of this business, rather than as a professional working in a practice. In other words, for these few moments, be the entrepreneur and manager and allow the professional to have a nap.

Goal Setting
The first step in mining the hidden opportunities within your business is to determine the kinds of opportunities you want to find. This means reminding yourself of the reasons you started this business in the first place. What did you hope to achieve, both personally and professionally, from your law firm? The next step is to set and write down these goals in a way that will allow you determine the extent to which you are achieving them and the extent to which you may have to refocus your efforts in particular areas. While a comprehensive review of goal setting is outside the scope of this article, there are a few tips to bear in mind. First, your goals must be written down. If they simply stay in your head, they remain conceptual and you will lack the commitment that comes with writing them out. Second, your goals must be "SMART"; that is specific, measurable, achievable, results oriented and time-bound:

  • Specific: If the goal is not specific, you lack a target. "Improve my marketing" is almost meaningless. On the other hand, the goal "find 10 new clients who meet the criteria x, y, and z within the next 4 months" is very specific, giving you a clear direction for your marketing efforts.
  • Measurable: Optimally, the desired outcome should be quantifiable so you will know when the goal has been achieved or surpassed.
  • Achievable: While being appropriately difficult and challenging, your goals should also be achievable. If goals are too easy, they will not move you outside your comfort zone and break out of old behaviors and habits. If they are too difficult, they become demotivating and self-defeating.
  • Results oriented: A goal such as "I will reduce the time I spend on administrative tasks by 25%" is result oriented. A goal of taking a time management course is one directed to an input that will then lead to a result. Focusing on results is clearer and leaves you open to consider a wide range of approaches through which the result can be realized.
  • Time-bound: There is no sense of urgency if there is no time frame. This is a formula for procrastination that will leave goals unrealized.

Divide to Multiply
Once you have clearly articulated your goals, you need to take a very hard look at your business to see where improvements can be made. Frequently, business owners attempt to fulfill this step by simply insisting that they need more or better people and that they have to sell more. While this may be true, it is not terribly useful from either a diagnostic or a strategic planning perspective. By breaking the business down into its constituent elements, you will be able to make improvements to each area that, when taken together, will have a multiplier effect, resulting in dramatic results. For this article, we will consider the areas of team, systems and marketing, which comprise the major elements of any business. Frequently, finance is considered a separate area, but we will not examine it in this article.

Leverage Through Your Team
The more you have qualified people do work that does not have to be performed by you, the more you can focus on those important tasks that do require your particular attention. The ability of your team to do this is a function of both your leadership and the dynamics within your team.

i) Leadership

"Every executive, every manager, to fulfil the role, must have a vision - a vision of where the organization will be and what it will look like in the future. They must create that vision and then share it with those reporting to them, if they are to gain a high level of employee involvement and commitment and attain a high level of productivity"

In considering the issue of leadership, one faces the question: "Who is driving your business?" The future direction of the business can easily become unclear in the face of rapid and continual changes in the marketplace and as a result of the speed of technological innovation. The small to medium size legal service business can become particularly challenged in the area of business development. The level of excellence in service demanded by the client today increases as you meet her expectations of yesterday. The need to continue to deliver a service that is better today than it was yesterday will challenge the vision the leader creates and the team receives. Low team moral, absenteeism, and resignations are some signs that leadership has become overwhelmed and is in need of repair.

As summarized in the following chart, there are very clear differences between leadership and management. Partners in law firms, being business owners who enjoy the services of staff and associates, should be cognizant of these differences and commit to developing and nurturing their leadership skills.

Leaders : Managers:
Originate Imitate
Challenge status quo Accept status quo
Innovate Administer
Focus on people Focus on process
Inspire trust/encourage action Rely on control
Create a long term vision Focus on short term

ii) The Team
A strong team is critical to achieving your goals. You will be able to trust them to take things from your plate and to see them through to satisfactory completion. However, all too frequently, business owners use the word "team" to describe their staff, but pay little attention to whether those people actually do function as a team. A team is a group of people, possessing skills that are complementary and who are committed to a common goal and approach for which they are mutually accountable. The extent to which a group does or does not act as a team can be a function of leadership or of particular dynamics within the group that need to be examined. To determine whether you have a group or a team, consider the following chart:

Group: Team:
Independent members Interdependent members
Conformity Free expression
Self-focused, hidden agendas Mutual goals, sense of purpose,ownership, unity
Conflict escalates or is avoided Conflict resolution exists; constructive conflict valued
Communication challenges Honest/open communication

If you are seeking a team and find you have a group, begin attacking the problem by asking yourself the following questions:

  • Have I clearly articulated a vision that my people embrace?
  • Have I shared a set of common goals for which we must all strive together?
  • Are the rules of the game that is played in my business clear and have they been communicated? Rules of the game are those things that comprise the culture of the organization.
  • Do we have an action plan for achieving the common goals?
  • Do I support innovation and initiative?
  • Do I have objective criteria and a systematic process for hiring that increases the likelihood that each person I hire will accept the vision, commit to the goal, and fit within the culture?

Leverage Through Your Systems
The last question regarding your team is an example of an area where systems can have a dramatic impact on the success of your business and on the time you are required to work in the business rather than on it. To most powerfully leverage your time, your people, and your resources, you ultimately want your business to be systems dependent rather than people dependent. Your systems, taken together, comprise "the way we do things here." It is often very difficult for business owners to commit themselves to making the operations of their business as systematic as possible. They feel it is too "corporate" or that it runs counter to the frontier spirit of the entrepreneur. In point of fact, by having systems in place, both you and your team are free to be far more creative and forward-thinking since time and energy need not be spent inefficiently reinventing frequently performed functions. Here are some tips to introducing systems to your business or enhancing the systems you already may have in place:

  • Create an organizational chart. Even if you only have a small team, where individuals double or triple up on duties, it is critical to have an organizational chart for each position, not for each individual.
  • List all routine activities within the organization
  • Allocate specific responsibilities to each position.
  • Document the how to's of all routine activities, with time frames.

If the "way your business does things" resides only in the minds of you or your employees, then you have assets that are walking out of your office every night. This means increased training costs when there is staff turnover. It also means that you must be more involved in operational details, thereby restricting your own personal freedom.

Leverage Through Your Marketing
Marketing is that part of your business that will provide you with the clients you wish to service over the course of your business. The purpose of your marketing activities is to lower the cost of acquiring new clients and to increase their lifetime value to your business. To maximize the results you generate from the time and resources you dedicate to marketing, it is important to approach your marketing very strategically and methodically. This involves three distinct steps.

1) Develop a marketing plan. In basic terms, a marketing plan answers the following five questions:

a. Who are the clients and the potential clients that you are targeting? This should be described in as much detail as possible, combining both demographic and pyschographic information;
b. Where are they found in reasonable concentrations where I can reach them?
c. Why would they want to buy from me? This means being conscious of those elements of your business, your services, and your expertise that are unique.
d. What will be my offer to them?
e. How will I communicate with them?

2) Diversify your marketing. Many lawyers tend to rely on what I call the diving board marketing structure. Their marketing platform is supported on one end by only one or two marketing activities. Frequently, these are activities that require the lawyer's personal participation. This approach to marketing is inherently unstable and does not provide predictable results. A more powerful approach is to use a table structure where the marketing platform is supported by a large number of legs. This can involve strategies to increase the number of leads, techniques to convert more leads into clients, and ways to encourage clients to consult with the law firm on a larger number of issues. Not all such strategies will require your ongoing involvement. The trick to ensuring you are using the right strategies on an ongoing basis is to test and measure each approach and use only those that consistently provide a positive return. In this way, your marketing shifts from being an expense to being an investment.

3) Have a disciplined approach to customer service. 68% of customers that cease transacting with a given business do so because of perceived indifference. By committing to superior and creative customer service, you can achieve long-term client loyalty and create raving fans. Raving fans are those clients who are so delighted with your service that they sell for you. Raving fans are created not by simply satisfying their needs and meeting their expectations, but by constantly exceeding those expectations.

Legal services businesses face all the challenges of any other business. However, it is arguable that the owners/partners of such businesses, being so busy fulfilling their client work, are more challenged than many business owners in finding adequate time to dedicate to their roles as entrepreneurs and managers. This makes it all the more important for you to take a rigorous approach to developing your team, to implementing operational systems and to pursuing marketing activities. If you do, the goals that you hoped to reach by creating a legal services business in the first place will more quickly be within your grasp.

About The Author

Warren Coughlin is a lawyer, entrepreneur and business coach with ACTION International, the world's largest business coaching organization.

The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.