How To Create a Value Driven Service Delivery Model For Your Clients

August 22, 2018 By Andrew McDermott Leave a Comment

The traditional law firm is changing. In the past, clients were satisfied with the basics. Outstanding legal work, fantastic customer service. These were the hallmarks of a successful legal practice.

It’s no longer enough.

Pundits claim the traditional model will soon be obsolete. They’re right for the most part. The industry is changing in dramatic ways. It’s a twofold problem (1.) clients are no longer satisfied with the excellence traditional firms offer and (2.) law firms don’t know it yet.

Is the traditional service delivery model obsolete?

It soon will be.

There’s a fundamental change taking place and most firms don’t see it.

What change?

A change in mindset. Clients are no longer focused on the same things law firms are focused on. Today clients are focused on Output (results). This is what matters most to them.

Here’s the problem.

Most law firms are still focused on Input (e.g. billable hours/origination). Clients are far less willing to tolerate input these days. The result is a slow, declining spiral as law firms struggle to survive.

Is it really this bad?

How do we know these changes are coming? Maybe it’s simply changing for specific industry segments. There’s no reason to believe this is affecting the legal industry as a whole, right?

Let’s look at the data.

The Georgetown University Law Center, in partnership with Thompson Reuters Legal Executive Institute and Peer Monitor released a report titled…

The 2018 Report on the State of the Legal Market.

In the Georgetown report, we see that things aren’t going all that well for traditional law firms. In fact, there are consistent declines all across the board.

Practice area growth is in decline.

Collection realization rates are falling…

As hourly rates continue to climb. Yikes.

In fact, this report shows industry growth as flat or declining in most key metrics. Profit margins, billing and collection cycles, expense growth – they’re all in decline.

It’s all bad news.

In reality, this shakeup is wonderful news

How can I say that?

This is terrible news. While a few law firms are holding their own, things are getting harder for everyone across the industry. How is this “wonderful news?”

This seismic shift is an opportunity.

Only 38 percent of law firms are actively engaged in experiments to test innovative ideas or methods.

– 2018 Law Firms in Transition

The firms that “get it,” the ones who see this change for what it is and take action, will survive. They’ll succeed as firms all around them begin to fall.

Why?

The firms that succeed will avoid the cognitive biases that impede growth.

The illusion of control. Overestimating our ability to plan for and control future events, reinforcing the sunk cost fallacy and loss aversion.
Loss aversion. Continually pouring more and more resources into a failed strategy.
Preference for completion. The desire to see tasks, projects and ideas through to the end.
Pluralistic ignorance. Associates, partners or shareholders in a firm who disagree with a particular course of action but choose to remain silent. The reason? They typically believe they are the only dissenters.
Personal identification. The mistaken belief that (1.) our identity, reputation and social status is tied to our commitments and causes and (2.) withdrawing that support would jeopardize our identity, reputation and status.
The sunk cost fallacy. The hope that past and continued investments in a failing strategy will ultimately succeed.

The firms that succeed use humility, radical candor and courage to face the brutal facts of their situation. Leaders in these firms face their problems, fears and concerns head on. They’re…

Honest about their current performance. Are they more focused on ringing the meter? Or are they more focused on delivering value to clients?
Open about their place in the industry. Are they ranked near the bottom of the pile or worse, non-existent? What do clients think and feel about the firm? Are they well respected or known in the industry?
Transparent about where they’d like to go. Leaders in these firms don’t hide behind platitudes. They minimize firm politics, choosing to direct their attention in the direction they’d like to go.
Candid about the firm’s problems. Are partners leaving? Are profit margins falling? Do clients feel dissatisfied with the level of service they’re currently receiving? Winning firms face these brutal facts confidently.

Did you catch that?

Winning firms focus their attention on delivering value. To their clients first, staff second and the firm/partners third. They realize they can’t maximize partner/shareholder value without first delivering value to their clients and staff.

How do firms go about doing that?

They change their service delivery model to win

Take a look at this list.

Scrappy startups like Clerky and Startup Documents provide businesses with general legal help.
Sites like Cooley Go provide organizations with legal resources.
Services like Upcounsel give clients instant access to attorneys who are willing to provide the same exact service you do, for less.
Services like Qualmet help clients assess the value of outside counsel (you).
PwC, one of the Big Four accounting firms, opened a law firm in 2017. This trend is expected to continue.

Did you catch it?

The traditional law firm is under attack and has been for some time. There are thousands of services and providers, all of them encroaching on the traditional delivery model.

Legal futurist John Alber described it like this:

“Wait, wait,” I can hear lawyers protesting. “My clients love me. I’m great at service.” But our clients aren’t telling us they don’t like us. Rather, they’re saying that, as good a job as we do plugging jacks into our old-fashioned switchboard, and as truly pleasant an operator as we are on all their telephone calls, they really want something more like an iPhone. Or, as lavishly constructed as our Patek Philippe-grade watches are, they would rather have an Apple Watch. They want better price points all around, much better value than we have been delivering, and WAY better functionality.”

Clients want different.

There’s an army of providers who are eager to give them what they want. This means they’re able to get the exact results they want at a price they’re comfortable with. That sounds bad, but here’s the good news.

You can beat them.

Changing your service delivery model gives you the ability to accomplish several important things. Here’s how you go about doing it.

Identify client wants/needs. Your clients have obvious and hidden wants/needs. They have specific goals and objectives they’re trying to achieve. You’ll need to identify where and how you fit with their plans.
Determine how clients want to be served. Do clients in your portfolio prefer flexibility and ease-of-use? Are they focused on predictability and controlling their cash flow? Or do they prefer openness and transparency? Are they looking for an advisor who isn’t focused on ringing the meter? Your client’s values determine how they prefer to be served.
Uncover their objections. Clients have specific problems with the traditional model. They’re not always comfortable with discussing these openly. You’ll have to lead the way by creating safety and building trust.
Set firm goals and objectives. Are you looking to attract and retain all-stars? Maybe you’re looking to maximize your profit per partner? Looking to overtake a competitor and gain market share? You’ll need to have a frank conversation with leadership about the firm’s goals and objectives.
Change your service delivery model. You’ll want to change your service delivery model to something that meets the needs of your firm and client. This isn’t about randomly assigning a delivery model. It’s about choosing a model that maximizes value for clients and the firm.

Remember the biases I mentioned earlier? You’ll need to deal with them now.

Go through items one through four.

Once you have the answers to each of these questions, you’ll have the data you need to choose the service delivery model that’s right for your firm.

What does this look like?

Attorneys who know their ‘break even’ points. Most attorneys don’t know how to properly price their services. Savvy attorneys know how to make money regardless of the fee arrangement. Attorneys should be able to price their work appropriately and explain it to clients in a way that is clear, fair and predictable. When attorneys price their work properly, they eliminate concerns about profitability. Which means…
Clients and firms can choose the fee arrangement that works best for both. If every attorney in your firm understands their break even point and knows how to price their work properly, any reasonable fee arrangement can be profitable. Fixed price, subscription, retainer, hourly hybrids – it’s all doable.
Firms know how to work. Should your firm maintain a traditional office, transition to a ROWE/remote work, become a virtual firm or function as some sort of hybrid? Remote or virtual firms save clients money but are typically focused on a particular client or practice area. Traditional offices work best for clients who value a strong in-person, interpersonal relationship with key members of the firm.
Firms choose the right employment model. Should attorneys focus on billable hours, flat fees or completed projects? Which alternative fee arrangement works best? Billable hours encourages thoroughness and attention to detail. Flat fee or per project arrangements encourage efficiency. An added benefit? These arrangements give firms flexibility. For example, freelance attorneys can work on a per project basis. Salaried associates can handle billable work and so on.
Automation and semi-automation becomes the norm. Businesses like LegalZoom show automation can be done well. You can do it better. Your firm can curate policies, procedures and best practices to simplify work. Templates, samples and model documents can be created for routine work. Decision trees can be used to manage any necessary provisions or contingencies.
Performance requirements and services are standardized. Firm-wide expectations and standards would be set. Compliance requirements would be measured. Attorneys would receive clear standardized details on how they should handle service related details (e.g. legal matters or customer service). For example, when do you respond to client communication (e.g. four to six hours after receipt)?

You can mix and match or come up with your own service delivery model.

It’s completely up to you.

Your client’s wants and needs give you the data you need to change your service delivery model. If you’re looking to maximize client value you’ll need to start with them. Interview your ideal clients. Get a sense of their ideal firm, then adjust.

Adapt your service delivery model for the right client.

The traditional service delivery model will be obsolete

The traditional law firm is changing.

Outstanding legal work, fantastic customer service, clear pricing. Everything a firm needed to succeed in the past. These used to be the hallmarks of a successful legal practice.

Now they’re the basics.

Clients have changed. They’re no longer focused on the same things law firms are focused on. Today, clients are focused on Output (results). Your competitors are still focused on input (billable hours).

Don’t make their mistake.

This shakeup is wonderful news. Only 38 percent of firms are actively focused on this problem. You “get it.” You see this change for what it is.

Will you take action?

The choice is yours. Clients are dissatisfied. Your competitors are trapped in a slow declining spiral. The old service delivery model is broken. Give clients what they want, what they need and you’ll win. Create a value driven delivery model and you’ll be ready for the inevitable change.

3 Ways to (Actually) Disconnect from Work

August 20, 2018 By Andrew McDermott Leave a Comment

What would you do if I told you to stop thinking about yellow ties?

Your brain would instantly focus on yellow ties. The more you tried to shift your focus away from the yellow tie, the more you’d obsess over it.

There’s a secret hidden here.

It’s the secret to truly disconnecting ourselves from work.

Why your best ideas come to you in the shower

Neuroscience has the answer.

Dr. Alice Flaherty, renowned neuroscientist at Mass General shares the simple answer.

Dopamine.

That’s right, dopamine. It’s the neurotransmitter that makes you feel good. Dr. Flaherty, explains the effects dopamine has on our creativity.

“People vary in terms of their level of creative drive according to the activity of the dopamine pathways of the limbic system.”

Did you catch that?

Hundreds of activities we find enjoyable – taking a warm shower or bath, exercising, driving, eating good food, sleeping – these all trigger the release of dopamine. The more dopamine we have, the more creative and productive we become.

There’s another ingredient missing.

Distraction.

Dr. Shelley Carson researcher, psychologist and author of Your Creative Brain says distraction is actually a good thing.

“If you are stuck on a problem, an interruption can force an ‘incubation period,’ in other words, a distraction may provide the break you need to disengage from a fixation on the ineffective solution.”

This teaches us two important things.

Stress decreases our ability to come up with creative and productive solutions to our problems
When we’re stuck we tend to obsess on what doesn’t work.

This is why we struggle to disconnect from work.

We take our work home with us. We focus and obsess about problems we can’t really fix at the moment. We ruminate on our day, on the difficult parts of our job. It’s unfair and makes it more difficult for us to do our jobs well.

Disconnecting from work is impossible…

On its own.

Our minds are like steel traps. We focus on the things we feed it – whether that’s yellow ties, your billable hours for the week or a pending case.

You can’t let go.

Well-meaning people give you terrible advice. “You think too much. Stop over thinking things” they tell you, which only makes things worse. Their advice is difficult for most.

What’s the solution then?

Stop trying to disconnect from work. This approach is doomed to fail.

Instead, replace work with something else.

How?

Strategy #1: Do something you enjoy

Doing activities you enjoy triggers the release of dopamine. The neurotransmitter your brain needs to come up with a creative solution to your problems.

But it also provides a distraction.

There’s another wonderful benefit to focusing on activities you enjoy. Your cognitive abilities increase dramatically. Negative emotions like stress and anxiety decrease cognitive function. The more stress you feel, the less capable you are of solving your problem. So…

Take a bath
Do some exercise
Play a game
Go out to eat with friends
Travel to a favorite spot
Watch a movie
Get some sleep

Need more ideas? Dr. Eric Berg shares some helpful tips on increasing dopamine levels in the brain naturally.

Strategy #2: Do something you dislike

This sounds counterintuitive.

Just a few paragraphs ago I mentioned that stress and anxiety decrease dopamine levels and cognitive function. Now I’m suggesting that you do something you hate?

Confusing no?

Here’s why it works. It’s a counterintuitive way to reframe the problem or issue you’re currently struggling with. If you’re obsessing over your billable hours for the week, organizing your files will (a.) provide you with a distraction (b.) reframe your thinking on your billable hours dilemma and (c.) provide you with a dopamine boost and a sense of accomplishment.

It’s actually a win.

When you organize your files you’re using psychological frames to change your thoughts and feelings.

You’re also more likely to increase dopamine levels. Twice.

After completing a minor task you hate and…
When you go back to your original task.

It’s a clever way to change your thinking.

Strategy #3: Avoid your co-workers

Don’t spend time with your co-workers.

Avoid legal professionals when you’re trying to disconnect from work. Spend time with friends and family who are unfamiliar with or disinterested in your work.

Obvious, right?

You’d be surprised at the number of attorneys who spend their free time with other attorneys. They discuss other things besides work, at first. But eventually, the conversation drifts towards work. If you value your sanity this isn’t the time or the place.

This comes with the obvious tips.

Shut down your email client, turn off your phone or set it to do not disturb. Physically remove yourself from people, paperwork and projects.

These strategies won’t work if…

Your mind is allowed to wander. If you’re like most people, you prioritize work. The activities you do – whether you enjoy or dislike them should create focus. You should be absorbed and fully engaged in the task at hand.

Give your mind something to chew on.

Disconnect to do your best work

You take your work home with you.

Your brain wants to obsess. To ruminate on your problems, failures and stressors. Stop trying to disconnect from work. This approach is doomed to fail.

Instead, replace work with something else.

When you need to disconnect from work, temporarily replace work with an activity you enjoy or an activity you hate. Either one works as long as your mind is fully engaged in the task at hand.

Finally, avoid your co-workers.

Take the time you need to recharge and you’ll find you have an inexhaustible supply of amazing ideas.

3 Realistic Vacations for Families of Busy Attorneys

August 17, 2018 By Andrew McDermott Leave a Comment

A recent survey by global recruiting firm Robert Walters lists attorneys as the hardest working professional. The implication is clear isn’t it? Attorneys work a little too hard.

You know it.

So does every other attorney in the industry. So does every other attorney in the industry. You protect your clients. From abuses in power, unfair agreements and neglected promises. You hold people and organizations accountable.

It’s a busy and often thankless job.

Why busy attorneys need vacations

Attorneys routinely work 50 to 80 hours per week.

Business Insider shared the story of a corporate attorney whose day starts at 7am but ends at… 3:45am.

It’s sobering.

The effect on the health and well-being of attorneys is disastrous. Researchers share alarming statistics on the effect overwork has on their mental and physical health.

A Johns Hopkins University study found attorneys are 3.6 times more likely to experience depression than other professions. When they don’t have time to recharge the consequences bleed into their performance at work. The constant stress leads to cognitive decline.

Research shows your mortality is linked to your vacation time.

It’s not like this information is new to attorneys. You’ve probably heard it all before. So why do attorneys work so hard?

A vacation isn’t always doable for attorneys

Attorneys are often caught between two terrible options. Work long, hard hours or lose your job.

Solo attorneys work constantly to keep their bills and employees paid. For the first few years it’s a fight to keep the doors open and the lights on.
BigLaw associates run themselves into the ground to meet their quota. If they fail to meet their billable targets they know they’ll be fired.
Boutique attorneys are fixers. Their clients come to them for help when there’s a looming deadline, significant threat or crisis to handle. These clients are desperate for a resolution to their problems.

These are legitimate reasons to work hard but you still need a vacation.

What’s the solution?

Introducing the alternative, and more realistic vacations

Let’s face it.

You won’t be able to take an extended vacation whenever you want. But that’s no reason to sacrifice your family relationships.

You have options.

Option #1: The staycation

The staycation is the best of both worlds. You get the one-on-one time you and your family crave. But you’re also available if your firm needs you.

You take a day trip and you participate in leisure activities that are close to home and don’t require overnight accommodations. A few good examples of staycation activities could be:

Trips to water and amusement parks
Skydiving, rock climbing, skiing, snowboarding and other outdoor sports
Sports games (e.g. baseball, basketball, hockey, etc.)
Concerts, conventions and gaming events
Mini food and restaurant tours, dinner parties and informal get-togethers

A staycation keeps you close to home. Use it when your family knows/expects that you may be called away unexpectedly.

Option #2: The semi-vacation

You need downtime.

Your family and friends need some one-on-one time. But things are up in the air at work. You’re not dealing with a major crisis at the moment but your situation may change quickly.

Use the semi-vacation.

Here’s how it works. You negotiate a set amount of time with your firm. You divide your vacation time by creating hours of availability each day. You break your vacation time up into manageable pieces.

Day 1: You’re available from 8am to noon. You’re off for the rest of the day.

Day 2: You’re off.

Day 3: You’re available from 7am to 11am. You’re off for the rest of the day.

This enables you to carve out some much needed family time in the midst of a low-level crisis or moderate workload.

Your firm needs to be open to it. If you own your business and you’re able to take some time off problem solved. If you’re working for a firm, you may need to frame your request properly.

Jan,

I wanted to discuss my vacation time with you. I’d like to go on vacation from May 1st – 15th. It’s a slow period for us but things may ramp up later. I’d like to try vacationing on a part-time basis.

I could work 7 days out of my vacation for four hours each day.

Can we make this work?

This works well if your firm is open to your terms and it’s a great way to comprise. You and your family get the time together you need, the firm is prepared in the event of a surge in client work.

Option #3: Extended vacation with ROWE

In a Results Only Work Environment (ROWE) employees are paid for results (output) rather than the number of hours worked.

It’s perfect for solo/small law firms

Most attorneys are salaried employees. If hitting billable hours is the goal, it’s something you can do when you’re away from the office. Repetitive or routine tasks can be handled remotely. Need to appear in court? Pop in when you need to, then leave.

This gives you the ability to carve out a significant amount of family time.

It also means extended/unlimited vacations are possible. This works well for firms that are focused on billable hours as a goal. But it’s excellent for firms that rely on alternative fee arrangements (AFAs).

What if you’re still part of BigLaw?

Ask about remote work. BigLaw is finally beginning to embrace the remote and flexjob trend. Get a list of the do’s and don’ts. Meet your billable targets each week, then delegate, automate or outsource your non-billable work as much as possible.

Remote work + less non-billable work = more free time

Your vacation time – it’s tied to your mortality

You work hard.

Overwork has a disastrous effect on your mental and physical health. It leads to an inevitable decline in your cognitive abilities.

Overwork = defeat.

You and your family need vacations, but our ideal scenario isn’t always realistic. Alternative vacations give you the creative solutions you need to carve out more family time, even if you’re busy.

6 Firm Wide Metrics to Evaluate and Improve Your Practice

August 15, 2018 By Andrew McDermott Leave a Comment

Is your law firm doing well?

How do you really know that your firm is doing well? When it comes to firm wide metrics, many aren’t sure they have the answer. Their gut feeling tells them all is well so they go with that.

Maybe they’re right?

Or maybe their assessment of their firm is completely wrong. Is there a way to objectively find the right answer?

Absolutely.

Want objective proof? You need firm wide metrics

You gain clarity with the right metrics.

These metrics give you hard data on your firm’s performance. There’s no guesswork involved, no indecision on what needs to be done. Just crystal clear, actionable evidence to follow. With the right metrics you know (a.) when you’re off course (b.) what needs to be corrected and (c.) when you’re back on track.

Why does that matter?

These metrics enable you to avoid “decision by committee.” There’s no need for partners and shareholders to debate the merits of what can work. These metrics show you what will work.

Which metrics are we talking about here?

Cost per client conversion / acquisition
Cost of servicing a client
Realization
Profitability
Individual performance
Satisfaction (clients and employees)

1. Cost per client conversion / acquisition

How much does it cost to acquire a client? Which platform sends you the most clients? Which platform sends you the best clients? The cost per conversion / acquisition metric is a fantastic way to get data-driven answers to these questions.

Cost per conversion

Most attorneys know what I mean by conversion.

But, for the sake of clarity, I’m going to define it here. A conversion occurs when a prospect completes the desired goal. Calling you on the phone, sending you an email, filling out a contact form on your website, etc. It’s a goal or outcome that leads to revenue.

Easy.

Here’s the formula to calculate your cost per conversion.

Cost of traffic / by the number of conversions = Cost per conversion

If you have goals set up in Google or Adobe analytics, you’ll have what you need to track your cost per conversion and cost per acquisition.

Here’s why this matters

You’ll be able to get detailed data on:

The marketing channels that work best for your firm (e.g. Google AdWords, Facebook Ads, display advertising, guest posts, etc.).
Which website, landing pages, offers or ads produce the greatest amount of conversions you want
A keen minute-by-minute awareness of your marketing effectiveness

It’s a helpful way to measure your marketing effectiveness – without delving too deeply into data science and complex formulas.

Cost per acquisition

Here’s the formula to calculate your cost per client acquisition

Marketing expenses / number of clients = Cost per acquisition (per client)

Here’s the thing with this formula. You’ll need to be consistent with your timeframe. If you spent $2,000 on marketing in a month and you acquired 20 clients in that same month, your cost per acquisition would be $100 per client.

Here’s why this matters

If you have a set breakeven point this metric shows you whether you’re on track (or not). Let’s say your breakeven point for a specific practice area (e.g. bankruptcy matters) was $530 per client. If you spent any more than $530 to acquire a bankruptcy client you’d lose money. Anything less than $530 and you’re making money.

Here’s an important caveat.

Your breakeven cost per acquisition may vary by practice area. This is important. It enables you to allocate your marketing dollars to practice areas with the greatest financial upside.

Your breakeven point is your initial target.

2. Cost of servicing a client

This takes our previous point further. Calculating the cost of servicing a client requires that we factor in all of our fixed costs. We need to determine what it takes to attract and win a new revenue producing client.

Fixed costs include rent, utilities, payroll, taxes and fixed marketing expenses. Here’s a formula you can use to calculate the cost of servicing a client

Hours spent on client / Total hours spent * Total Fixed Operating Costs = Cost of servicing a client

This requires disciplined time tracking – at the client level and firm wide. The more accurate your data the more telling this metric is.

Here’s why this matters

You’ll get a clear idea of the quality and quantity of the work you’re doing for each client
You can identify which clients are profitable in the short and long-term
Assess which practice areas are worthwhile from a financial standpoint

With a little bit of digging, you can quickly identify the markers, red flags and identifiers of an unprofitable client. With a well-designed marketing funnel and the right data, you’ll have the knowledge you need to attract more of the promoter clients your firm needs.

3. Realization

As far as performance indicators go, realization is fairly straightforward. It’s the answer to a simple question. Of the time that’s billed, how much comes back to your firm as revenue?

Realization includes the following firm wide metrics:

Amount of work done vs. amount billed
Revenue billed per month
Revenue collected per month
Monthly expenses
The accounts receivable lifecycle (the amount of time between you doing the work and receiving payment)
Any discounts and/or write downs (before billing)
Write offs after billing.

This data is key.

Realization gives you the ability to forecast. It’s a simple and straightforward way to assess your firm’s financial performance.

Use these metrics to identify problem clients
Clients who pay well and pay on time
Which practice areas are profitable or unprofitable
Whether your collections policies need improvements to capture more revenue
Whether your time tracking methods are accurate

The data from realization is essential because it confirms your firm’s financial performance. With the right details, you’ll be able to increase revenue, decrease expenses and decrease losses.

4. Profitability

Clients aren’t created equal. One client can be more profitable than another. Some practice areas are more profitable than others. When it comes to measuring profit you’ll want to take a layered approach.

Determine profitability by:

Client
Firm
Partner
Practice area
Timekeeper

This gives you the granular data you need to find and address financial problems. The basic formula for calculating profit looks incredibly simple.

Revenue – cost = Profit

In reality this isn’t that simple. It really depends on the billing model you use in your firm. Do you use a cost-plus, fixed price or value-based model? How do you determine costs? These questions aren’t as easy to answer, as you already know.

It’s something you’ll need to define for your firm.

5. Individual performance

Which attorneys are your top/bottom performers? Which employees are financially profitable? If you’re looking for an answer to that question you’ll need to assess your attorney’s individual performance.

Here’s what I mean.

Let’s say attorneys in your firm have a maximum of 60 hours available in a week to bill clients. You decide to use this as your benchmark. If your attorney bills at $200 per hour that means the maximum they can earn for that week is $12,000 per week or $48,000 per month.

Here’s the math:

60 hours (total) x $200 per hour = $12,000 potential per week.

If this attorney only brings $7,500 hundred per week in that’s a 63% collection rate. You’re able to instantly gauge whether he’s performing as expected.

You can calculate this for the entire firm, groups in the firm (e.g. first year associates), and individuals.

Here’s why this matters

Measuring individual performance enables you to:

Maintain cash flow and profitability in your firm
Identify A players, A player potentials, B and C players
Set and maintain financial goals/benchmarks for your firm

Attorneys and those who produce billable work are judged primarily by the amount of billables they produce for the firm. Does this mean this is the only metric that matters?

Not at all.

But it’s the metric with the most immediate value.

6. Satisfaction (clients and employees)

Client satisfaction can be distilled down to one simple question.

“On a scale of 0 – 10, how likely are you to recommend us?“

This is taken from the NetPromoter score.

Promoters are loyalists. They’ll spend more money with your firm and they’ll refer other clients, driving growth.
Passives are unenthusiastic but satisfied with your work. They’re opportunists who are vulnerable to competitor poaching.
Detractors are unhappy clients who will use reviews and word-of-mouth as a weapon to damage your brand and restrict growth.

This is crucial because it tells you where to spend your time and attention.

Spending 80 percent of your available time on promoters keeps them happy and passionate about your firm. Continue to look for ways you can add value to these clients.
Offer lukewarm passives three to five percent of your available time, inviting them to become a detractor or promoter.
Give detractors 15 to 20 percent of your available time as long as they meet one condition. They qualify as unhappy, misinformed or underserved in some way. Ignore ragers, irresponsibles, trolls, users and abusers.

Use automated review and reputation management software to attract reviews and client attention.

Employee satisfaction is a bit more involved.

This comes down to a simple strategy you can use to gauge employee feedback.

360 degree feedback.

A 360 degree feedback assessment removes the fear, resentment and unnecessary conflict that comes with the feedback process. It can be difficult to manage but you’ll need a few details to make these reviews effective.

Outline review policies (e.g. be honest, be kind or be quiet)
Vet reviews ensuring they comply with policy
Provide examples. Show staff how to give good feedback

Give everyone the opportunity to review everyone else in the firm. This is painful but it’s good for the firm in the long term. It gives firm leaders a chance to address their blind spots before it becomes a major problem. This protects the firm in several ways.

This feedback provides radical candor boosting employee trust in peers and firm leadership
It gives law firms a chance to deal with their dirty laundry before it ends up in a review or on Glassdoor
This feedback keeps leadership humble and open to change
Provides the firm with consistent opportunities for growth
Reduces the odds of a mass exodus of associates and partners from the firm
Improves employee performance and client satisfaction by proxy

Research shows that 360 degree feedback increases staff performance significantly year over year. It’s not perfect, but it’s an excellent way to foster trust in a firm.

Maybe you’re interested in a different set of metrics?

These metrics are the basics.

They’re a firm wide overview of your practice. The number of performance indicators you can measure is near limitless but in this case, less is more. A comprehensive amount of data is not as helpful as many of us have been led to believe.

You know your firm best.

Start with the basics, the data that tells you how you’re doing and where you need to improve. Then add in the data that gives you a customized view of your firm’s performance.

You know your firm is performing well when…

These metrics provide you with the data and evidence you need.

Most firms track a few of these performance indicators. But how many firms make it a habit to monitor these key performance indicators?

Not many.

True, these metrics don’t always deliver the best news. Sometimes our gut feeling is wrong. Sometimes we’re not doing as well as we thought. These firm wide metrics are an important part of our growth. If you’re looking to grow your firm you need this data.

Why?

Because even if it’s bad news, it’s good news to know.

Knowledge provides direction.

It’s a simple and straightforward way to gain clarity about your firm’s performance. There’s no guesswork involved, no indecision on what needs to be done. Measure the right metrics and you’ll know what to fix and when, ensuring that you’re never off track again.

4 Leadership Qualities that Peers Admire

August 13, 2018 By Andrew McDermott Leave a Comment

What makes a leader great?

It sounds like a simple question, but it’s one that’s difficult for many to answer objectively. Collective wisdom says great leaders are important. Why then, is greatness so difficult to pin down?

It actually isn’t.

It’s simply something we don’t know that we know. It’s difficult to put into words, until we see it. When we see it the reaction is immediate.

“That. Right there. That is great leadership.”

The hidden reality of leadership few will admit to

I’m talking about meta communication.

What exactly is meta communication? George Bateson coined the term to describe our “communication about communication.“

Which means… what?

Meta communication a hidden layer of communication that exists in our day to day lives. It’s a consistent stream of communication that flows through an organization. From one person to the next in a continuing, endless loop.

It’s an inevitable part of communication.

Your words and actions send a clear but unspoken message about yourself, the firm and your perception of those around you.

Here’s an example.

A recent survey of 124 law firm managing partners, conducted by industry consultants Patrick McKenna and David Parnell, a whopping 93 percent of firm leaders report bullying at their firms.

The worst part?

The bullies at these firms are the high earners. They know their rainmaking abilities give them power and many are opting to use that power selfishly.

Let’s jump into the meta layer.

What does this kind of behavior say to everyone at the firm?

You’re not safe here
Don’t trust anyone or the wrong person
Hide your thoughts and feelings
Don’t show your co-workers who you really are
Lying is a good way to protect yourself
If you aren’t a powerful high earner, you can’t change the problem

This poisons a firm’s culture. It destroys morale.

Here’s the thing about meta communication. Everyone in the firm contributes to the pool of meaning. Partners, associates, paralegals, administrative assistants.

As a leader your contributions do more

We emulate those we follow.

As a leader, your ideas infect your co-worker’s contributions (for better or worse). Your success creates influence and persuasion, leading others to adopt your behaviors as their own.

Those who don’t follow leave.

Those who stay, but disagree, deal with the positive or negative consequences of your actions. Leaders function as a sort of informal king, influencing and guiding those around them.

As the king, so the people.

Which brings us to leadership qualities. What are the qualities peers admire in a leader?

Most focus on character.

But this is the starting point. The foundation for a great leader. If you don’t have good character, you aren’t a great leader. I’ll touch on that briefly.

So what qualities are we discussing then?

Quality #1: Good character and ability

Outstanding leaders typically have the following qualities.

A high degree of intelligence
Trustworthiness
Honorable
Consistent top performers
Very hard workers
Resourceful, going above, under, through obstacles
Self aware and humble
Teachable
Kind to others regardless of their status or station in life
Driven by values, morals and ethics
Are strong, capable, confident and powerful

Most pundits list these details as the most admirable leadership qualities to have and they end there. But these are just the starting point.

Quality #2: They don’t assert their power over others

An exceptional leader fights for agency.

They do their very best to respect their peer’s choices even if that means they have to walk away from the relationship as a result of that.

They avoid ultimatums.

That’s the thing with ultimatums, they can be implicit or explicit. Great leaders recognize that choice is the best motivator for those around them. They work to control their environment, conditions and circumstances – never people.

They’re sensitive to their peers.

They don’t brag about their bonus with associates who haven’t received theirs. They’re mindful of the stress that up and comers may be under.

You’ll never hear a variation of “do it or else!” from them.

Quality #3: They build their peers up, legitimately

They humble themselves and serve those below them when needed. They bring opportunity and success to their peers. They’re more than willing to recommend a peer for a position if there’s a legitimate fit.

They give without expectation of return.

The professional world is dominated by claims of “I did this for you so you owe me.” These exceptional leaders recognize that some things that are more important than money.

They give generously and receive gratefully.

They remember the favors and goodness others have given them and they pay it forward. They take the opportunity to brag about the accomplishments of others.

They teach them.

They make themselves available to those who can’t reward them in any way. This isn’t about pro-bono work. It’s about serving others because you recognize the value of doing so.

Quality #4: They pay their debts

Some partners feel it’s okay to take advantage of their associates.

“It’s par for the course” they say.

Exceptional leaders are different. They give without expectation of return but they receive with the intention to reward. They work to remember every courtesy, favor or kindness granted to them.

Then they respond accordingly by.

Rewarding their giver
Paying it forward in a bigger way
Forgetting about their gift and moving on

They pay their debts but give out gifts. This is a hard path to follow. Many people give with expectation – they want to make sure they get what’s theirs. There’s a fundamental principle that ensures that will happen.

You reap what you sow.

We apply this inconsistently assuming it works with negative outcomes. But it works both ways.

You have greatness inside you

You can change the meta communication at your firm. Great leaders are made; we recognize them when we see them.

Greatness, your exceptional leadership qualities…

They’re all about communication. Your meta communication adds to the pool of meaning. With words, through your actions. It’s the hidden reality of leadership we don’t know that we know.

Share your greatness with those around you.

Your peers recognize greatness, but they won’t know until they see it. Might as well be from you.

How Clients Find Lawyers Online

August 9, 2018 By Kelly Street 1 Comment

Even today, there are a few lawyers out there who don’t believe the internet will help them get clients. Luckily, the majority of lawyers do believe it, and it’s a good thing they do because that is where clients are looking.

Referral first, search second

According to the ABA Journal, 38% of consumers are turning to the internet for their lawyer search as a first step, compared to 29% asking family and friends for a referral or recommendation first. For the younger legal clients out there, the numbers are even closer with 17.8% of 18-24 year olds searching only online, whereas 12.1% hired a lawyer based on a recommendation from a friend. While these numbers seem reasonable, I would also like to know if the survey takers looked for information about the lawyer online after getting the referral. Personally, when I get a referral from someone the first thing I do is look that company or person up online to verify that the internet agrees with the referral.

How Will They Look Online?

Mobile First, Desktop Second

Mobile search has now surpassed desktop for online searches, especially for initial searches. Think about how many times this has happened in your life; you’re with friends and get a recommendation for XYZ, so you look it up on your phone right away. Then when you get home, you hop on the computer to finalize a purchase or see it on a larger screen.

Now add in the layer of law and imagine you are having a legal issue. You go into work, sit at your desk and go to Google search… wait, you don’t want work to know you are thinking of filing a workers comp claim– you pull out your smart phone and search there. So does everyone else.

This is why it is vital to have a responsive design website and ensure a seamless user experience for your website. A separate mobile site, non-responsive, or static website design are things of the past. Consumers will visit your website and either get frustrated or think your firm is outdated. Neither option is a great first impression to make, no matter how highly recommended you are to that potential client.

Online Reviews

When searching directly by name, the first few search results will generally be your website and online review sites, like Yelp, and your Google My Business profile (which you should set up immediately, if you haven’t already). If a new or potential client sees an average of three out of five stars on your profile, they are more likely to distrust or be skeptical of your firm. If they haven’t yet contacted you are were in the search stage, you name may just end up at the bottom of their list because of negative reviews.

Reviews can come from social media sites as well. Facebook allows reviews on business pages, but Twitter and Instagram could have mentions associated with your name that you aren’t aware of. Make sure to periodically check for hashtags related to your name and your firm’s name, in case you are missing what consumers are saying about you on those sites.

Directories are still important to search and Avvo is a very reliable resource in a legal consumer’s mind. With their proprietary rating system, lawyers may be frustrated with they are scored, but if you can get a few happy clients to balance out their analysis of you, it would be worth it to invest that extra effort.

When it comes to negative reviews, what matters more than the reviews themselves is how you respond. We recommend that our clients follow one of two procedures for negative reviews: 1. Respond directly to the review stating that you apologize for their experience and would like them to contact you to discuss the situation. 2. If you know who the reviewer is, reach out directly to let them know you saw the review and wanted to apologize and see if you could resolve their frustration.

You never, ever want to engage in a back and forth publicly with an angry consumer. If the reviewer responds in anger, leave it be. Potential clients will see that you tried and that the former client is unwilling to engage. I know a lot of lawyers are worried about responding to these reviews but I have seen my recommendations work in a majority of cases.

On Your Website

Your website is likely the first place potential clients will be judging you. Look at your bio page. Does it scream ‘stereotypical lawyer’ or does it show you as the unique human being that you are? While your experience related to a potential clients legal issue is highly important, their ability to connect with your firm and yourself is more important. There is an attorney I’ve seen who had been a pro wrestler and is now practices personal injury. His page highlights that previous experience and allows potential clients to know a side of him outside of the law degree.

Apart from your personal experience, make sure to include robust and helpful content on your site related to your practice area. Create fun or interactive content, like quizzes, or a chatbot to interact with website visitors. This will keep people on the site longer, which Google likes, and provide resources for potential clients to view your site as a tool for their legal assistance.

Testimonials are widely used in the legal field, especially is personal injury-related practice areas. If your clients aren’t comfortable going on camera or using their likeness, you can repurpose online reviews with just a first name or allow clients to use a pseudonym and mark it as such for legal ethics purposes.

Online To The Real World

What matters most to potential clients isn’t your biography or years of experience. It is a fast response to their inquiry, whether it’s through Facebook message, phone call, email, or GMB Q & A. However they contact you, they want to know you are ready to help. If you don’t have an answering service set up, I highly recommend connecting with one of the many options available. (Two options: Ruby Receptionist, AnswerOne). Consider adding a new contact option of texting. As you gain younger clients, they may be more comfortable making text contact to start, rather than a phone call. You can start this with a dedicated Google phone number or try Apex chat, which offers both chatbot and texting services.

Most Importantly, Be There

What matters most online is simply that you and your law firm exist there with a website, a Google My Business account, other websites linking to your site, and mentions of you or your firm around the web. The effort you choose to put where is up to you.

What matters most to potential clients, regardless of how they found you? That you respond quickly, provide excellent customer service, and value their business.