Andrew McDermott

When it comes to technology, lawyers are risk-averse.

At least, that’s the stereotype trotted out by legal technologists. But is this actually true? Are lawyers this resistant to technology, innovation and growth?

Not at all.

The evidence shows lawyers and law firms are innovating. Slowly but surely, law firms all around the country are adapting to meet the demands of today’s modern client.

Here’s the problem.

Law schools aren’t moving in lockstep with firms

Today, clients are obsessed with value.

Law firms are expected to produce tangible results and outcomes for their clients. What’s worse, clients are no longer willing to pay for research costs, expenses and/or first-year/junior associates.

Firms are expected to do more with less.

A Mattern & Associates study found “firms only see a return of a quarter of all costs associated with work done on a particular matter.”

What does this mean?

1. Clients themselves are under intense pressure to produce results
2. Clients pressure law firms to produce results, focusing exclusively on value.
3. Both clients and law firms expect more immediate value from junior associates

A reasonable expectation, right?

This isn’t what’s happening.

Law schools: A safe haven for Luddites

When it comes to technology, the majority of law school students are sophisticated users of social media and texting.

And that’s about it.

Dig a little deeper you begin to realize this is a complete disaster. The average (majority) of students leave law school with $100,000 to $200,000 of student loan debt. Law school is a whopping 5.82 times more expensive than it was in 1985. You can view the debt rankings by school here.

Well it’s not so bad because many first-year associates are paid well, right? Sure, the lucky ones who are hired are sometimes paid well. Are most of these students getting jobs?

Not so much.

The ABA Journal released a report showing that less than half of graduates had jobs before graduation. The evidence shows a large segment of the law school population doesn’t fare any better post-graduation.

This is why law school students need digital competency

Law firms, like their clients, are under a significant amount of pressure to perform. They need new associates, law school graduates, who can hit the ground running. These are the graduates who consistently win excellent positions with well-paying firms.

Law schools are struggling to deliver.

New graduates are clueless about the kind of technology they’ll use in a firm.

They’re unfamiliar with word processing, working with PDFs and manipulating spreadsheets. They’re also unfamiliar with the ins and outs of practice management software, automated document assembly, legal project management document and knowledge management.

Most new graduates are unaware of the tools they’ll need to function in their day-to-day life as a lawyer. Most graduates are lost – but it also isn’t their fault.

The good news? Change is coming – law school student digital competency is on the horizon

Law schools are shaking up their curriculum, prioritizing digital competency ensuring graduates are better prepared for life after the bar.

Change is slow.

Law school students can improve their postgraduate prospects by focusing on their core competencies. The skills and technology needed in their practice area/firm.

Are lawyers risk-averse?

Absolutely. As far as critical thinking goes, lawyers are exceptional. Law firms aren’t resisting technology, they’re embracing it, albeit slowly. Firms all around the country are adapting to meet the high-pressure demands of today’s modern client.

Law school students don’t have to wait to become digitally competent.

An emphasis on value in law schools means graduates are prepared to produce said value. The law school environment is competitive. Today’s graduates are fighting for a seat at the table. With the right education and an emphasis on digital competency, every graduate can win.

 

It’s a big problem. State bar referrals are a huge opportunity for your firm, and yet many, many attorneys struggle with business development.

Which is really a vague way of saying most attorneys aren’t attracting the volume or type of clients they need.

One possible solution?

Your state and local bar associations. That’s right, your bar associations could be a profitable avenue of business development. A way to attract a consistent and steady stream of new, eager clients.

But how?

The first step to take to earn state bar referrals? Talk to LRIS

If you’re in a participating state, you probably already know that your bar association has a pre-existing network of attorneys they refer. The Lawyer Referral Information Service (LRIS) includes a list of “approved attorneys.” These attorneys meet a predetermined set of qualifications.

This isn’t new.

Bar associations in 44 states (and the District of Columbia) have a state bar referral service. In fact, there are approximately 70 ABA-approved LRIS programs in the country.

It could be a valuable resource.

But it could also be a complete waste of your time. You’ll have to do some upfront digging to identify whether your local LRIS is worthy of your time and investment.

Here’s how you do it.

Step #1: Contact your state/local bar associations

You’ll want to gather the contact information for state and local bar associations. Ideally, you’re looking for a specific point of contact you can speak with via email or phone.

You have questions.

These questions will help you to assess whether (a.) your local LRIS is actually worth your time and (b.) the type of client, practice area or level of client they refer and (c.) the sort of volume can you expect if this referral service is worth your time.

1. Find your (state/local) bar association in the list
2. Identify a key point of contact
3. Ask them your questions, gently press them for direct answers
4. Decide whether LRIS is right for you (or not)

Why go through this process?

Your state or local bar association may not feel it’s worth their time to advertise, market or promote their state bar referral service. Their referral service may simply be a time waster (for you) and a revenue generator (for them).

Your time is valuable.

What if state bar referrals aren’t worth your time?

No problem!

Simply divert your attention towards creating content for your bar association, using the opportunity as a stepping stone to bigger opportunities. For the time being, we’re going to assume that state bar associations are worth your time.

What’s the next step?

Step #2: Get straight answers to your questions

Use this list of questions to get a clear sense of the time you’re investing in this process. If it isn’t a fit for your firm or you individually simply walk away.

Okay here are the questions.

1. How many referrals were offered to attorneys in the last fiscal year? A rough, back-of-the-envelope calculation is fine if your point of contact is offended by your request. 
2. How many referrals in [practice area(s)] were offered to attorneys in the last fiscal year?
3. How many of these referrals are won (e.g. become clients)? Most bar associations won’t have the answer to this question. This isn’t great news but it’s also not a deal breaker if they don’t know.
4. Does the bar association have a specific number of leads they prefer to generate?
5. Does the bar association have a specific number of potential clients they’d like to attract? “As many as possible” is typically the easy answer. Press for a more specific estimate.
6. Historically, which practice areas receive the most referrals?
7. Which firms received the most referrals in the last fiscal year?
8. What does the bar association do to attract/generate interest with potential clients? (g. advertising, SEO, PR, etc.)
9. In round numbers, would you say that the bar association spends more than $25,000 to $50,000 on advertising (to prospective clients for LRIS) or less? Even if they know, most bar associations won’t give you a precise figure. An estimate is fine.
10. How is the bar association compensated for these referrals?

These questions require charm.

Asking these questions cold may ruffle a few feathers. Make this pill an easy swallow. If possible, take your point of contact to lunch. They’ll be more amenable to your questions. If a particular point of contact doesn’t pan out, ask someone else.

Why ask these questions?

• If they can’t (or won’t) give you a rough estimate there’s a good chance they aren’t offering much in the way of referrals. Any membership fees or dues could simply be a way to generate revenue.
• If they don’t advertise or market to potential clients, you’re less likely to receive referrals yourself.
• Referral by practice area tells you (a.) where the bar association makes most of its money (b.) it shows you how they prioritize your practice area.
• If your bar association is willing to share, get data on the firms that receive the most referrals.
• If your bar association services 91,000 attorneys statewide, but they only spend $1,000 a month on advertising, you know there won’t be enough referrals to go around.
• The number of preferred leads your bar association wants tells you (1.) where their focus is (e.g. serving attorneys vs. boosting membership fees) (2.) the volume of referrals that passes through their hands on a weekly, monthly or quarterly basis.

If the numbers don’t add up it’s probably best to pivot your attention elsewhere. One idea could be to consistently creating content for the state bar. Then, once you’re established, parlay that into bigger more lucrative opportunities that generate more business for your firm.

If you’re satisfied with their answers proceed to…

Step #3: Applying for LRIS

Most states have a specific set of requirements (i.e. rules of panel membership) they’ll need you to meet.  You’ll also want to make sure you’re aware of the ABA’s guidelines on LRIS.

Use the list I mentioned earlier.

Then, once you’re ready, fill out the registration form, pay any applicable fees and go from there.

This still isn’t a guarantee.

In fact, there’s absolutely no guarantee you’ll receive a steady supply of leads for your firm. Unpleasant news but completely true. Here’s a simple way to dramatically increase your odds of success.

Become their favorite.

How exactly do you do that? You serve your state bar. State bar associations are hungry for content. There’s a significant amount of pressure on them to provide value to their members and non-members.

So provide value.

Doing that keeps you on their radar. The more valuable you are to your state bar association the more likely you are to receive the steady supply of referrals you crave. Remember the steps I shared earlier?

1. Identify the content needs of your state bar (e.g. take a marketing coordinator, gatekeeper or decision maker to lunch and ask questions).
2. Create a pitch, offering to provide your state bar with a regular stream of content
3. Go above and beyond, creating content in a variety of formats (e.g. ebooks, blog posts, videos, speeches, etc.) to serve both members and non-members.
4. Provide helpful hooks, lead magnets, downloads, consults and services for tangential attorneys. These are attorneys who serve the same clients you do in a different, yet complementary way (e.g. corporate attorney + IP attorney + tax attorney, etc.). Use direct contact and/or LRIS where appropriate.
5. Parlay this experience into bigger publications and venues. If you’re a corporate attorney, you could use this as a springboard to speak at an entrepreneurial conference.

See what I mean?

Business development and earning state bar referrals can be easy, if you provide value first

Many attorneys struggle with business development. They aren’t attracting the type or volume of clients they need.

Your bar association could be the answer.

Give your bar associations what they need and you cultivate a steady and consistent supply of new clients. It’s a strategy many attorneys haven’t even considered.

You? You’re in-the-know.

Ask the right questions, nurture the relationships you need and you’ll find your bar association produces the value, state bar referrals and fees you’ve always wanted.

They’re not just about discipline. State Bar associations administer exams and regulate CLE credits. They handle attorney discipline citing attorneys for ethical, compliance and other violations.

They do so much more.

Attorneys who misunderstand this point do a disservice to their career. That’s because bar associations, when used appropriately, become an attorney’s greatest benefactor.

State bar associations can work for or against you

We’ve all heard the stories.

A public reprimand of this attorney, disciplinary proceedings against that attorney. Bar associations, seem to have a stern reputation, the kind that more prone to delivering bad news.

What if they delivered new business?

What if your bar association worked for you rather than against you? What if your state and local bar associations became your greatest ally? The kind of ally that boosts your career, attract new prospects and convert new clients? What if your bar association helped you to become an influencer in your own right?

The kind of influencer that attracts bigger fees and sizable contracts?

It’s definitely possible.

But is it something you can accomplish for yourself and your firm?

Absolutely.

If… you know where to start.

Seek first to understand, then be understood

Remember the saying from Franklin Covey? When you’re working with bar associations this is the basic template for success.

This tired quote?!

This is the key to extracting value from your state and local bar associations? I get it, this sounds ridiculous. It actually isn’t, here’s why. Most attorneys are only focused on extracting value. A vanishingly small number of attorneys are focused on contributing value.

Here’s why that’s important.

Most people are focused on being understood. They want those around them to listen to their story, to empathize with their situation or circumstance.  They want others to provide them with the help and support they need. When it comes to helping their bar association though, they’re not at all interested.

It’s an unwillingness to understand.

This unwillingness to understand exposes their giving profile. Takers seek to extract, they rarely contribute. Matchers scratch your back if you’ll scratch theirs. Givers, on the other hand, give without thought or expectation of return. As it turns out, givers are also commonly focused on understanding and serving the needs of those around them.

What does this have to do with your state bar association?

Just this.

What you get out is what you put in.

In a previous post, I mentioned Peter Thiel’s value formula. It’s worth repeating so I’ll briefly recap that formula here.

1. Create X dollars of value for your state bar association
2. Capture Y percent of X.

This formula is a distillation of the axiom above. If you’re longtime reader you remember. This succinct equation describes the way the world works. This formula applies to relationships, groups, businesses and yes, even bar associations.

Here’s how you use it.

Step #1: Ask yourself “what’s in it for me?”

It’s a quick and easy win.

Thirty-two states require membership in the state bar to practice law. But requirement doesn’t equal engagement. This is why it’s common for many attorneys to treat their membership (mandatory or not) as an afterthought.

You’ll want to be selfish.

Ask yourself the question “what’s in it for me?” Go through your bar association’s website and/or marketing materials. Read their pamphlets, brochures and data sheets outlining the benefits available to you as a member. List everything, whether you currently use it or not.

Here’s an example.

Explicit benefits typically include:

• Education in the form of a law library, educational resources, CLE presentations, etc. education typically comes in the form of books, video, audio, courses and other trainings.
• Many bar associations provide members with licensed copies of legal software (e.g. legal research, document management or legal case management) at reduced/no cost.
• Hotel, lifestyle, office, technology and travel discounts are common. Other bar associations also provide discounts on other much-needed products and services. These provide additional financial incentives attorneys/firms can use to offset their expenses.
• Payment processing. Access to online payment processing via reputable third-party providers.
• Meeting facilities. A large room for presentations, meeting rooms for depositions. It’s common for bar associations to provide attorneys with a meeting space they can reserve for bar or individual related purposes.
• Your bar association may provide you with options and additional savings on your insurance plans including health, dental, life, professional liability, accidental death, property and casualty, crime, auto and home insurance.
• Prescription drug benefits. Some bar associations may negotiate special pricing on prescription drugs via an established third-party provider
• Practice management software. Many state bar members are eligible for steep discounts on web-based, practice management software.
• Marketing services. Sophisticated associations may also provide discounted advertising, access to mailing lists, web development and production services.
• Assistance programs. Many bar associations provide attorneys with free and confidential help to deal with personal issues like burnout, stress, marriage and addiction problems, career concerns and more.

Like I said these benefits are explicit. What about the implicit benefits bar associations offer?

Implicit benefits typically include:

• Client referrals via the lawyer referral information service and informal one-to-one and one-to-many direct tangential attorney/client relationships.
• Business development and marketing support in the form of additional marketing opportunities. Most attorneys choose the expensive route of going it alone. Working with your bar association gives you access to a massive captive audience. Sophisticated and motivated clients who are part of your bar association’s social media and email lists.
• Authority building. Creating and publishing content on behalf of your bar association establishes you, over time, as an influencer and authority figure in your own right.
• Advanced networking. Used properly, your bar association provides you with access to other skilled influencers, thought leaders and legal professionals.
• Intelligence in the form of unknown unknowns comes as a result of the networks and relationships you build via your membership and engagement with your bar association. The kind of valuable information every firm wants but very few receive.
• Used appropriately, your bar association will enable you to attract attention from employers who aren’t hiring and firms with no open positions or opportunities.
• Your bar association is more than willing to provide you with a steady supply of clients and revenue. You just need to do the right things for them in return.

As the name implies, these implicit benefits aren’t advertised.

Step #2: Next, outline “what’s in it for them?”

Your bar association needs help.

Bar associations are under a tremendous amount of pressure to provide value to their members (states with required membership less so). What specifically does this mean for your law firm?

Bar associations need content.

Creating content for your bar association provides you with the implicit benefits mentioned above. Depending on your bar association, it may also give you more leverage to negotiate more favorable terms on any explicit benefits offered.

Here’s what that looks like.

Here’s where this gets interesting.

The attorney speaking is Emil Ovbiagele of OVB Law & Consulting S.C. he’s a young attorney, only five years in, but is already providing the bar with the client-friendly content they need. When he provides the bar with the content they need his firm benefits.

Can you do more?

It all depends on your effort, doesn’t it? Here’s how you can provide your bar association with value.

• Take a marketing coordinator, gatekeeper or decision maker to lunch and ask questions. Look for areas and opportunities (e.g. frustration/problem spots) where you can add value (e.g. content, connections, knowledge, expertise, time or resources).
• Pitch decision makers. Outline the problem they face then present them with a low risk or no/low cost solution.
• Then go above and beyond, creating a solution that over delivers on your promises. If you’re creating content for the bar, provide them with a variety of formats (e.g. ebooks, blog posts, videos, speeches, etc.).
• Capture a percentage of the value you’ve provided. If you’ve created content for the bar, lead referring attorneys or prospective clients back to your site with a valuable download. Look for an appropriate opportunity to capture a percentage of the value you’ve created.
• Once you’ve provided a valuable solution, immediately work to solve yet another problem. Work to consistently over deliver, exceeding your bar association’s expectations. If your idea is rejected, pitch another (better) idea. If your idea is accepted, pitch again after you’ve delivered results. Keep pitching until you’re explicitly told to stop.
• Parlay your work with the state bar into bigger publications and venues, increasing their status, prestige and revenue as they go. Here’s an example of a simple guest post Bruce Stachenfeld wrote for Above the Law. Remember, these publications have a big problem – they’re starving for content.

Step #3: Go all in

If you decide to move forward go all in. Half measures take a considerable toll in the form of missed opportunities and lost revenue. Don’t let that happen to you.

Remember the axiom:

What you get out is what you put in.

You can’t afford to put in more time. If you’re like most attorneys, you’re struggling to perform as it is. Research shows most attorneys lose 6 to 8 hours of work to nonbillable work. It’s common for attorneys to work nights and weekends just to stay current.

Now I’m suggesting that you “go all in?” How exactly do you make that happen? Here are four simple strategies most attorneys aren’t using.

1. Tiny habits
2. Virtual assistants
3. Dead time
4. Automation

1. Tiny habits: Make high performance automatic

Motivation is garbage. This isn’t just me saying it, it’s Mel Robbins, a former criminal defense attorney and CNN legal analyst turned motivational speaker.

Take a look.

Tiny Habits circumvents motivation entirely.

BJ Fogg Ph.D., Director of the Behavior Design Lab at Stanford University created Tiny Habits. He created it after discovering that only three things will change behavior in the long term.

Option A.  Have an epiphany
Option B.  Change your environment (what surrounds you)
Option C.  Take baby steps

Tiny Habits uses options B and C to create real lasting change. A tiny habit is the smallest component of a habit you’d like to create. If you’d like to floss your teeth after every meal you don’t set that as a goal.

You just floss one tooth.

That’s it. If you do that, you’re automatically a winner. And you know what he found? Doing that means most people do more.

Instead of pitching your bar association you just add an email to your message in the “To:” field. Instead of coming up with 16 different ways to add value, you come up with one. Then the next one.

See what I mean?

2. Virtual assistants

In The Art of Delegating Legal Work, Norman Clark shares what he calls the delegation matrix. Here, let me show you what that looks like.

Pretty self explanatory, right?

Note: Read this post for a full breakdown of the details shared in this section.

This matrix shows you what to delegate, when to delegate it and why. Use this matrix to focus on the to-do items that matter most.

Next, you’ll need to build a virtual bench.

Most attorneys attempt to build a virtual bench when they need it. This primes firms for failure. Think about that for a second. If you have a pressing deadline or a matter that needs to be taken care of quickly, you’re desperate.

That desperation clouds your judgment.

Instead of looking for the best legal professional desperation compels you to look for an adequate legal professional.

You need A players.

Here’s how you go about finding those A players.

1. You place an ad. You outline the specifics of what you’re looking for in your job description. Share requirements, expectations and qualifications needed. You use a tool like JobScore or Recruiterbox to share your ad across multiple platforms instantly.
2. Filter candidates with applicant tracking systems and software. There are free options like Qandidate and paid options like Recruiterbox. You’re looking to filter out irrelevant candidates, spammers and You want to minimize the amount of time you spend with non-potentials.
3. Create a list of potentials.These are candidates you feel may be a good fit as a virtual assistant for your firm. You can use additional tools like HarQen to automate and semi-automate video and phone interviews.
4. You spend a bit By now, you should have a short list of potentials. Let these candidates know you’re willing to spend 10 to 30 percent more on the best professional.
5. Ask potentials to arrange an interview. This is a phone interview with the previous client, manager or partner. It should be with someone they’ve worked with, at the organizations they’ve listed on their resume. A players will jump at the chance to show they’re amazing, C players will slink away.

Use this to build your list of professionals.

Do your best to outsource or delegate as much of your non-billable work as possible.

3. Dead time: Become a rainmaker in your spare time

Here’s a strategy elite attorneys use to get an enormous amount of work done in a very short period of time.

Dead time.

Dead time is occupied time. The time where you’re doing something tedious, repetitive or mindless (mostly). Eating lunch at your desk, your daily commute to and from work, working out, etc. Here’s how you use dead time to become a rainmaker.

1. Get a topic from your state bar (see steps 1 and 2 in the previous list).
2. Write one question on that topic on your note cards (use as many cards as you need).
3. Take one note card and a voice recorder with you in the car on your way to work.
4. Answer the questions thoroughly, in great detail. Treat each question like a chapter in a book.
5. When you’re done, get this content transcribed and edited via a freelance provider.
6. Compile it into a blog post, video, speech or book.
7. Send the finished product to your state bar for review.

This is a simple strategy you can use to add value to your bar association, fellow attorneys and yourself. But it’s also an untapped resource few attorneys are using.

4. Automation: Save 6 to 8 hours per day

With the right approach and a small amount of automation, you can win a significant amount of your productive time, back. It requires some upfront work but it’s all front loaded. Once you’ve set things up this system just works. Here are some things you can automate.

• Scheduling meetings and appointments
• Tasks and deadlines
• Automated time tracking to simplify billing and invoicing
• Client intake and follow up
• Automate document assembly
• Bookkeeping
• Client support
• Review management

You shouldn’t be spending your time on these. If you’re a grinder, minder or finder you should focus your attention on the details that matter most.

Here’s a detailed breakdown, showing you how to automate these details in your firm/for yourself.

Can you see it?

The secret ingredient needed to maximize the benefits you receive from your bar association membership?

It’s you.

State Bar associations work for or against you

They’re not just about rules and regulations.

The state bar is a wonderful opportunity in disguise. It’s a chance to give and receive value. Want overwhelming value from your membership (mandatory or not)?

What you get out is what you put in.

Attorneys who understand this give their legal career a huge shot of forward momentum. That’s because state bar associations, when used appropriately, become your greatest benefactor.

You can do this.

Use giving and receiving to maximize the benefits your state bar association receives. Serve your peers, add value and you’ll convert your bar association into your biggest ally, no reprimand required.

They are an untapped gold mine. Your state bar association resources are a wealth of opportunity for your firm.

They are also neglected by most attorneys. The vast majority of attorneys fail to take advantage of the tools and resources offered by their state bar. This isn’t due to negligence, it’s a lack of awareness.

Many attorneys don’t know what state bar association resources are offered.

Do you?

Here are five common state bar association resources available to you and your firm.

State Bar Association Resource #1: Education

This isn’t new information.

In the back of your mind, somewhere you know that your state bar has educational content. Content you may be able to benefit from. Do you know how to use that content?

Here’s how you do it.

1. Identify yourself. Are you a maven (information gatherer), connector (people gatherer), or sales person (sophisticated persuader)?
2. If you’re a maven, make time to take advantage of the content that your state bar provides (i.e. dead time). Ask your state bar to (a.) provide you with content on the specific topics you’re looking for and (b.) offer content in the format and timeframe needed (i.e. short video files posted online).
3. If you’re a connector, identify mavens in your firm and/or social circle. Begin sharing information from your state bar with friendlies. Find out what they like, then provide them with intriguing and specific forms of data. Feed mavens with the information they crave, and you’ll have their attention. Ask the state bar to provide the content you want.
4. If you’re a persuader, work to persuade those around you. Use the education that’s provided. Again, ask the bar to provide you with education on the information and topics you want. If you’re a member of the bar or an influencer in your own right, you have more clout than your peers. Use it!
5. Request the information you need. If you need information for CLE, request it. Searching for a solution to a common problem in your firm? Request it. If you know someone who may have an answer to their problem, make a recommendation.

Here’s why this strategy is so effective.

You’re able to shape and control the direction your legal education takes. If you’re aware of the problems and issues you face or you’re aware of the problems that you have – use it! Then use this information to boost your professional social circle.

Here’s how:

If you’re a maven, position yourself as a specialist on the topics of your choosing. Provide your firm/peers with value whenever needed. If it’s free, they’ll grow to depend on you. If they depend on you, it strengthens your position in the firm hierarchy.

If you’re a connector, collect mavens and other connectors. Use this education to build connections. Work to become the firm resource, the attorney with specialist connections no one else has.

If you’re a persuader, use this education to add value to those around you. Use your persuasion skills to identify solutions to your problems. Then work to (ethically) solve those problems for your firm/peers.

State Bar Association Resource #2: Software

Key state bar association resources that are provided to members includes software licenses and discounts.

Some bar associates may provide members with access to tools like Fastcase. They may maintain their own library of books, video, audio and trainings on a variety of subjects/topics.

Take advantage of it!

Use their tools with the strategies and tactics I’ve laid out in resource #1. If you’re a member, ask for the tools and resources you want. Ask about the state bar association resources that they already have on hand and how they can be made available to you or your firm.

State Bar Association Resource #3: Insurance plans and discounts

Many state bars association resources offer insurance through approved third parties. These insurance plans typically cover some or all of the following:

• Cyber insurance
• Crime coverage insurance
• Surety bond coverage
• Auto and home insurance
• Health insurance
• Dental and vision
• Life insurance
• Long-term care insurance
• Disability insurance
• Professional liability insurance
• Accidental death and dismemberment plans
• Property and casualty and more

The collective clout of your state bar association resources means members are often able to get insurance at deep discounts.

Insurance options through your state bar association resources may provide you with significant savings and dramatically decreased premiums. If you’re a firm owner, that’s peace of mind and revenue you’ll be able to keep.

State Bar Association Resource #4: Marketing support

State bar associations, like any other publisher, are hungry for content. There’s a significant amount of pressure to provide an exceptional amount of value and service to both members and non-members. That’s where you come in.

It’s an opportunity to become a rainmaker. Attorney referrals are common, but they’re much more common for rainmakers. Attorneys on the outside often wonder how it’s done.

That’s a good question.

How do these rainmakers attract a disproportionate amount of attorney referrals? They provide other attorneys with an exceptional amount of value. Here’s how they do it:

1. They identify the content needs of their state bar (e.g. take a marketing coordinator, gatekeeper, or decision maker to lunch and ask questions).
2. They create a pitch, offering to provide their state bar with a regular stream of content
3. They go above and beyond, creating content in a variety of formats (e.g. ebooks, blog posts, videos, speeches, etc.) to serve both members and non-members.
4. They provide helpful hooks, lead magnets, downloads, consults and services for tangential attorneys. These are attorneys who serve the same clients in a different, yet complementary way (e.g. corporate attorney + IP attorney + tax attorney, etc.).
5. They parlay this experience into bigger publications and venues, increasing their status, prestige, and revenue as they go.

It’s a simple strategy most attorneys aren’t using.

Why?

They’ll state they don’t have the time. But 9 times out of 10, this isn’t true. There’s a simple strategy attorneys can use to get an enormous amount of work done in a very short period of time.

Dead time.

Dead time is occupied time. The time where you’re doing something tedious, repetitive, or mindless (mostly). Eating lunch at your desk, your daily commute to and from work, working out, etc. Here’s how you use dead time to become a rainmaker.

1. Get a topic from your state bar (see steps 1 and 2 in the previous list).
2. Write one question on that topic on your note cards (use as many cards as you need).
3. Take one note card and a voice recorder with you in the car on your way to work.
4. Answer the questions thoroughly, in great detail. Treat each question like a chapter in a book.
5. When you’re done, get this content transcribed and edited via a freelance provider.
6. Compile it into a blog post, video, speech or book.
7. Send the finished product to your state bar for review.

This is a simple strategy that you can use to add value to your state bar, fellow attorneys, and yourself. But it’s also an untapped state bar association resource few attorneys are aware of.

State Bar Association Resource #5: Assistance programs

Legal work comes with its own set of challenges and problems. Did you know that state bar association resources can include a variety of assistance programs? State bar associates provide attorneys with free and confidential help to deal with a variety of issues that attorneys commonly deal with.

• Burnout
• Stress, anxiety and depression
• Marital and familial problems
• Gambling addiction
• Eating disorders
• Work/life balance
• Career concerns

Here’s why this is crucial.

Many attorneys choose to struggle with these issues alone. Often times they struggle with an overwhelming sense of guilt and shame which induces them to hide their problems.

Assistance programs extend an olive branch.

They show attorneys they aren’t alone, that they don’t have to carry the burden alone. Many of the attorneys and professionals involved in these assistance programs have experienced the same problems. This significant for one important reason.

Empathy.

If they’ve gone through the same (or similar) struggles attorneys will most likely receive the empathy and support they need to recover and change for the better. Their services are confidential (who would use it if they weren’t!).

Your state bar association is an untapped resource

Most of your peers aren’t using it.

It’s an incredible resource that you can use to grow your firm and boost your career prospects. If you know how to use it. Most attorneys aren’t negligent, they’re simply unaware.

Don’t wait until it’s too late!

Take advantage of these resources and you’ll have what you need to produce unexpected value – for the bar, your firm, your peers and yourself.

Are your clients receiving value?

The automatic answer from most firms is yes. Here’s the truth of the matter about this assessment. In most cases, the law firm is right. Law firms have an intimate understanding of the value they provide.

Do clients agree?

Research shows the answer is no. According to Lexis-Nexis’ Age of the Client, 40 percent of clients believe the service they receive from their firm is above average. Unfortunately, 80 percent of attorneys believe their service is above average.

What firms call exceptional, clients call average?

Is the bar set too low?

Are firms simply mediocre? Are they focused on doing the absolute bare minimum to serve their clients? For some firms, the unfortunate answer to that question is yes. Read through anonymous posts like this one and you’ll see answers like these.

“Get on second call. Again have no idea what it will be about, but assume I can handle it because it is with an unsophisticated corporate client that we love because it lets us ring the meter. Junior comes to my office to listen to call. In-house lawyer bloviates about irrelevant points for 30 minutes and I field another 20 emails while on call and mark a document at my desk, occasionally paying attention to the call.”

Is this client receiving above average service?

Obviously not.

Here’s the thing about attorneys. This seems to be the exception rather than the rule.

How do I know?

Data shows a large amount of competition, downward pressure on fees and a variety of unpleasant changes means attorneys are more motivated than ever to provide exceptional service to their clients. They want their salaries and firms to grow!

Seems like common sense, no?

Attorneys are right. In the vast majority of cases, firms are doing exceptional work for their clients. Clients aren’t seeing it that way though.

Why is that?

Clients use a different standard to rate their firms

Client priorities are simple and straightforward. There are details that seem obvious when you read them, when in reality they’re actually obscure. Firms know these details are important, they just don’t know how important.

Here’s what matters to clients:

See that there?

There are 14 metrics listed here. Items number one and three are focused on one thing.

Your fee.

“Provides clear indication of likely costs/works to fixed fee” and “explains charging system clearly at outset” are two of the most important factors listed here, revolving entirely around money. In fact, this entire list is based on money or attorney/client communication.

Here’s another key point.

When it comes to fee arrangements, clients are interested in clarity and flexibility. When they find the right firm, they want to know their team will work with them on the price. The data suggests this flexibility is an unspoken deal breaker for clients.

This is why firms need alternative fee arrangements.

Clients demand it.

The attorney/client power dynamic has changed

A recent survey found a change in confidence.

Approximately 9 out of 10 attorneys believe they’re operating in a period of unprecedented change. The great recession has produced clients who are demanding, value-driven and cost-conscious. There’s an almost obsessive focus on the value-to-price ratios.

The market responded.

A flood of low-cost competitors and alternative fee arrangements flooded the marketplace. This seems disheartening at first glance but it’s actually a wonderful opportunity in disguise.

Here’s why.

1. Low-cost competitors struggle to provide/match a significant amount of value that quality firms Their business model isn’t comprehensive enough to meet the demanding needs of today’s client. Without an innovative (and proprietary) process this low-cost model is unsustainable in the long term.
2. As we’ve seen above, clients are using very specific metrics to gauge attorney/firm performance over the long-term. Firms that struggle to deliver compelling value over the long-term continue to lose clients, regardless of their traditional, alternative or low-cost pricing schemes. Price is not enough to retain profitable clients in the long-term.

Peter Thiel, PayPal founder and former attorney, created a model firms can follow. This model provides firms with the clarity they need to: (a.) Increase revenues consistently year-over-year (b.) attract and retain profitable, top tier clients.

Are you ready? Here it is.

1. Create X dollars of value for clients.
2. Capture Y percent of X.

Using the table above, you can structure your firm’s alternative fee arrangements on doing just that. Creating real, quantifiable value for each of your clients.

How can AFAs accomplish that?!

Let’s take a look.

The vast majority of alternative fee arrangements (and their variations) are based on one of these AFAs.

1. Fee caps: Hourly billings are capped at an agreed upon maximum for a given case, project or service. As you might have guessed, this is hourly billings with a slight modification. This arrangement is definitely more beneficial to clients than it is to your firm.
2. Fixed fee menus: This option provides set pricing on a variety of services provided by the firm. Additional flat fee charges could be added to the initial base price. An investment transaction could be billed at $25,000. Added to that, an additional $8,000 fee for assuming a loan. $10,530 for financing and so on.
3. Fixed fees for single engagements means firms set a hard price on several well-defined services. This isn’t ideal for new services or practice areas and it’s not a great fit for inexperienced attorneys. Firms using this AFA need volume to make this arrangement worth their while. This is perfect for services that produce the lion’s share of a firm’s revenue.
4. Full contingencies: With these no fee unless we win arrangements, survival depends entirely on success. These AFAs are common with plaintiff and defense attorneys. This AFA works best if your firm has a competitive advantage or noted ability in a specific practice area. Avoid this AFA if you’re unsure of the outcome or results you’ll achieve.
5. Holdbacks: A contingency arrangement where a predetermined amount is guaranteed as payment to the firm (say 20 percent). The rest is contingent on the firm’s success in achieving the desired outcome. Receiving fees at 80 percent of your usual rate, with the remaining 20 percent contingent on success. This is often combined with bonus or success fees, further incentivizing firms to deliver results.
6. Partial contingencies/Success fees: Similar to a holdback, the firm receives a portion of their fees during the engagement. They receive an additional lump sum at the end of the engagement if they’re successful. Partial contingencies typically define success criteria ahead of time. These criteria are sometimes left to the client’s discretion or spelled out in significant detail.
7. Portfolio fixed fees provide clients with a single, fixed price for a large number of services. For example, an organization’s intellectual property engagements over the course of a year. With this arrangement, losses are inevitable so you’ll need a significant amount of volume to come out ahead.
8. Retainers: The legal industry’s old faithful. A fee your clients agree to pay every month, for a set period of time, for a specific set of services. These are well known but they’re growing in popularity thanks to the surge in demand for AFAs.
9. Risk collars: An hourly billing arrangement that rewards efficiency. With this hourly billing arrangement, attorneys receive a bonus if their work is completed under budget. Clients receive a discount if the work goes over budget. The actual discounts and bonuses vary from firm to firm but it helps to align the client’s/firm’s interests.
10. Subscriptions: Similar to retainers, subscription plans give clients access to a specific set of services and engagements for a predetermined price. While retainers have a set timeframe and clear purpose, subscriptions are more universal in their application, continuing indefinitely. Subscriptions require a significant degree of experience as you’ll need to be aware of what it costs to provide a particular service.

That’s a lot to choose from.

We need to answer a more pressing question before we can create value with these alternative fee arrangements. The question is an obvious one. Which practice areas can benefit most from alternative fee arrangements?

The short answer is, all of them.

Every practice area can benefit from alternative fee arrangements. At first glance, this sounds unrealistic. Certain practice areas seem to be tailor-made for specific fee arrangements. Several practice areas seem to be exclusively oriented towards hourly billings.

Am I suggesting that every practice area must have infinite flexibility?

Not at all.

Instead, I’m recommending that your firm use alternative fee arrangements as a tool to align client interests with your own. Here are a few examples to show you what I mean.

• Example #1: A client retains your firm to initiate litigation against former executives, directors and officers for fraud. Your client agrees to pay all expenses and costs associated with said litigation. Your firm receives full reimbursement on a “first dollar out” basis as well as a percentage of recoveries from litigation.
• Example #2: Another client retains your firm to handle litigation and a complex legal matter. They agree to pay your firm a premium but ask that you “hold back” 30 to 40 percent of the agreed-upon fees; your client agrees to pay this holdback (plus multiples) provided that the outcome meets a previously agreed-upon standard.
• Example #3: A development client retains your firm to pursue arbitration against a joint venture partner. The project is worth $175 million. You and your client come to an agreement where they will pay 50 percent of your rate plus a percentage of the value received once the development project is sold or liquidated.

See what I mean?

In each of these examples, the alternative fee arrangement is used to align both parties in the attorney/client relationship. The AFA is used to (a.) Provide a win/win situation (e.g. value/profit) for both parties (b.) Create motivators that disincentivize manipulative, predatory or dishonest behavior (e.g. ring the meter).

Here’s why that matters.

Though clients are often unwilling to admit it, AFAs are about one thing and one thing only.

Control.

How do we know? They tell us. Here’s a direct quote from clients in the research I’ve shared above.

“I get a better-quality service or product if I do the homework upfront. I like to be in control.”

Historically, clients felt they weren’t in control. The attorney/client relationship felt as if they were writing a blank check. Their firm gave them a vague description, they outlined their hourly rate and the process.

Clients paid, begrudgingly.

Today firms are challenged by a new generation of clients who demand alternative fee arrangements. A greater degree of control gives these clients the power they need to protect their interests.

This is very good news for law firms.

But only if you approach AFAs the right way. When it comes to AFAs, there are only two ways to approach the problem.

Proactive or reactive.

Proactive firms initiate the AFA conversation with their clients, discussing pricing, budgets and expectations. Reactive firms wait for clients to initiate the conversation.

Which one is better?

An Altman Weil survey compared these two approaches. Here’s what they found.

“When asked to compare the profitability of non-hourly work and hourly work, 84% of proactive firms find their non-hourly projects to be at least as profitable as their hourly projects. This is the case in only 51% of reactive firms. Narrowing the focus, 40% of proactive firms report their non-hourly projects are more profitable than their hourly projects, compared to only 10% of reactive firms. The lesson is that firms that make a rigorous effort to understand and manage a new or evolving market tactic like alternative fees generally succeed in doing so, and enjoy increasing benefits over time.”

Here’s the obvious question:

Why aren’t more firms taking a proactive approach to alternative fee arrangements? The greatest obstacles listed weren’t technical (e.g. skills or software), they were cultural and political (e.g. resistance from partners). The fear is obvious – these AFA’s won’t be profitable.

The data shows otherwise.

Some firms try, and fail, to make these alternative fee arrangements work. The fault lies elsewhere. In the vast majority of these cases, fee arrangements weren’t given the proper attention and preparation. The obvious and hidden risks are ignored. Here’s how you can make these alternative fee arrangements work for your firm.

1. Collect performance and financial data: Make a detailed assessment of the practice areas under consideration. Create a list of all the tasks, routines, systems and procedures involve and handling matters in this practice area/group. Next, identify the costs involved for each of these items. Outline the costs for billable and non-billable work. Outline the average expenses and costs for each area and various employee levels (e.g. paralegal, first-year/junior associate, senior associate, partner).
2. Create optimization and improvement protocols: You’ll need to develop systematic and repeatable methods for producing, managing and maintaining the work that’s performed. Your goal is simple. Work to consistently (a.) produce high-quality work that’s (well) above average and (b.) Create innovative strategies and protocols to reduce the cost of the work produced (while still maintaining quality standards).

Sounds intimidating, doesn’t it?

It really isn’t.

First, take the time to consistently collect performance and financial data (a little at a time), and opportunities for improvement will present themselves regularly. If you’re using practice management software, data collection can be automated or semi-automated.

Just read the reports.

Then take some time to think about how you’d solve the problems presented in each report. Reach out to trustworthy advisors, chat with your mentors. Seek out help on an as-needed basis. Initiate conversations with clients regarding your AFAs. Work with them to create a solution that aligns both of you on the same page.

Then, position your firm.

Use the Cobb Value Curve in your practice area to: (1.) Create a massive amount of value for your clients (2.) Create pricing indifference (clients are consistently willing to pay what you ask).

How does it work?

William Cobb, creator of the Cobb Value Curve, explains it in detail.

Just one thing.

Using AFAs to create an ideal solution requires one thing.

Time.

You need enough time to work on your business rather than in your business.

What does this mean?

If you’re buried under client work and your obligations to the firm, you’re working in your business. If you’re using AFAs to solve your client’s problems and align your interests you’re working on your business.

Use the formula.

1. Use AFAs to create X dollars of value for your firm and your clients.
2. Use AFA’s to capture Y percent of X

Take a proactive approach to your client’s financial concerns, study your practice areas, then implement the changes gleaned from your learning.

It’s not rocket science.

You have the ability to produce a massive amount of revenue and profit for your firm. You have the chance to strengthen client relationships, to maximize the amount clients spend with you while reducing your overall expense.

Are you willing to do it?

The AFA isn’t a cure-all. Clients are still looking for the same things they’ve always wanted.

What clients want

Offering a clear indication of the likely costs/works to fixed fee

Regular progress updates

Explains billing system/fee structure clearly at the onset

Fully appreciates your needs and expectations when taking on your case

Personally responds to emails/calls within 24 hours

A good listener

Meets deadlines/follows a timetable

Demystifies the law/makes it understandable

Explains range of possible outcomes based on previous experience

Empathizes with clients and their situation

Treats clients as a partner in the relationship

Tailors service around an individual client’s needs

Proactively alerts ongoing clients to relevant legal changes

Retains a professional distance

Your fee is the beginning.

It’s the first big hurdle of the attorney/client relationship. Your alternative fee arrangement can align both parties in the relationship. With your AFAs you can offer clients a win/win situation and create motivators that disincentivize win/lose behavior.

Do this and you become exceptional

You and I know the truth.

If you made it this far, you’re already exceptional. Most attorneys do amazing work for their clients, clients aren’t seeing things the same way.

Are firms to blame?

Most likely not. Most firms know they produce exceptional value. They have an intimate understanding of the value they provide. This isn’t the exception, it’s the rule. As we’ve seen, competition, downward pressure on fees and commoditization motivates most firms to deliver tremendous value.

Most clients aren’t seeing it.

They’re using a different standard to rate their firms. Their priorities are easy, simple and straightforward. Use their rating system to teach clients about the value you’re already providing. Combine your learning with the Thiel formula and the Cobb Value Curve to create an AFA that maximizes value and profit for both parties.

Do this and you’ll find clients believe you’re the exceptional firm they’ll do anything to keep, value assured.