There is so much talk about technology in law firms, Alan and I thought we’d take a step back and focus on some basics skills to improve your practice. Your turbocharged office should NOT be solely turbocharged with technology. So here you go.
Write a simple business plan – for you, not the bank or a potential business partner.
The goal is for you as a business owner to see the big picture and understand exactly who you are, why you’re unique, and who you are equipped to serve. Creating it will help you answer questions like “Do I have a profitable business?” or “Am I making money?” or “Am I spending too much?” or “How can I get more clients?”
Build a budget.
Without a budget you are flying blind. Create some basic financial spreadsheets that help you keep an eye on where you are spending money and how much money is coming in. If clients are paying but bank account remains low, it may be a sign to look more closely at your monthly expenses and cash flow. (Link to my article Mid Year Financial Checkup) Don’t get bogged down in details. It is paralyzing. Starting today, add a column for current month and start entering your expenses and money received. This document will evolve over the months, but at least you now have a place to keep an eye on your business.
Know how much money you need to make each month in order to keep the doors open.
You should know this number by heart. If you don’t know this number, go back to #2 and build your budget. It should be written down where you can see it every day. Put it on your wall or on your computer screen. Put a picture of your family or next vacation spot next to it. Then, everyday write down how much money came in and keep a running total so you can see how close you are to reaching your monthly “need to collect” number. This number is your “monthly nut.” Any amount over that number is your money to take home.
Know where your good clients come from.
This means you have to ask them how did they find you. How did they hear about you? Most really good clients will come from one of three sources:
- Your really good current or prior clients
- Other lawyers or referral sources that you know and trust
- Your family and friends
The above sources have three important things in common: they know you, they like you and the trust you. This is your gold mine – tend to it and mine it often. You can’t buy know, like and trust. It is earned, over time. If you are investing money in advertising and marketing efforts, be sure to keep an eye on how many new clients are coming from these sources and whether they are good clients or bad clients. The good ones pay on time and say good things about you. The bad ones don’t pay on time and make you very grouchy.
Take care of your referral sources.
When you get a new client from one of the above good referral sources, what are you doing to thank them? Here are a few ideas that have some “stickiness” to them:
- Send a donation to a charity they are involved in and let them know you did it. Use LinkedIn to get this information. (BTW, we used to own a bar and I would occasionally buy one of our really good customers a drink and take it off their tab at the end of the night. My husband would always remind me that I am losing out on the power of that act because the customer will never notice I took off that last drink he ordered. So I switched to always offering to buy their first. They remember this.)
- Pick up the phone and call them – now, not next week. Let them hear the excitement in your voice for the new client you just signed up. You will be less likely to make the call a few days later and the excitement level will be lower.
- Send a $5 gift card to a local coffee shop. If he/she is sending you referrals, you can bet they are doing some networking.
- If you recently read a good book you think they would enjoy, send them a copy and ask them to pass it along when they are done.
Concentrate on client service. Make sure it is exceptional, not just great.
This sounds so overdone and so basic. But step back and look at all the ways your clients are interacting with your firm. Your website. The initial phone call. The first visit to your office. Email conversations. How they are getting documents from you. Interactions with your support staff. Returning phone calls.
Put yourself in their shoes and pretend you are a client working with your law firm. Critique each interaction and grade yourself and your staff. People remember having great client service. People will talk about exceptional client service. They also remember mediocre client service. You want to be talked about the next time your client is out with friends and you want it to be because you did something exceptional.
All businesses need systems, what are yours and have you developed them.
I have two favorite books that if you have not read, add them to your holiday wish list. The first one is “Checklist Manifesto” and the other one is “The E-Myth Attorney.” Read them and you will start understanding the power of building processes to increase efficiency and deliver better product. Within your business, you have things, task you do repeatedly. The purpose of documenting what you do is to improve it and do it more efficiently. There is power to writing down the steps you have to do in order to file a bankruptcy, or do an eviction. Seeing it on paper opens up windows for doing it better or faster.
You’ll never develop clients sitting behind your desk. Get out and leverage your networking activities.
Know your current clients and ask them for referrals. They already know you, like you and trust you.
Know your referral resources: People who respect you enough to be willing to open doors for you, as well as knowing others’ needs and what it takes to address them.
Know your centers of influence: These people are leaders in their industry within your community. They make things happen.
Get connected with connectors: Those people who delight in bringing like-minded people together and you can find them on LinkedIn.
Follow-up and consistency are the cornerstones of a strong business.
It’s the little things in life that count and clients will remember that you followed up, asked questions and stayed in touch with them. You are creating the foundation for a great client relationship when you focus on these two behaviors. Create a good system to help you remember to do the follow-up.
Sit next to a stranger
The adage is “there is no such thing as a stranger, only a friend you haven’t met.” The same holds true for lawyers and prospective clients and/or referral sources. The next time you are at a social event, get out of your comfort zone. You have your “power talk,” the best way to perfect it is to keep using it, and there’s no better way to do that by expanding your circle of sources.
One of the best free marketing tools is to volunteer. All of us are engaged in some sort of civic activity, be it school, religious, extracurricular or social group. All of these organizations need some sort of volunteer to do some work. Why shouldn’t that person be you? All it takes is a small amount of time weekly, semi-monthly, or even more, and it will open the door to you again “sitting next to a stranger” and getting your word out.
Make it all about your client
Remember, you hear it all the time…this is their tragedy. They need to know you care…My motto is that if someone wants to know a lot about me, they can read it in my obituary. If they’re interested in me before I go to the great courtroom in the sky, they can go to my website. When I meet a client, prospective or existing, I turn my mouth off and let them talk. It is their case, not mine. It’s their crisis, not mine. I have “markers” that I utilize during client meetings. After the initial “small talk,” I ask the individual “how can I be of service to you?” and let them talk. And talk. And talk. If there is three seconds of silence, I then interject. As lawyers, we are skilled in our field. But our clients don’t want to know about our skills. They want to know what we can do for them. Let them tell their story. When they have finished, it is only then that you have gained their trust.
What will success look like?
Before beginning the work, ask your client what success will look like. Don’t just guess. You’ll probably be wrong.
Learn to create road maps
Clients have no idea what is involved in filing a bankruptcy or settling a DUI. Make your first meeting a memorable one and draw a picture or an outline of the steps involved.
Learn to say “No”
I am certain that there was a class in law school that purged this word from our vocabulary. Just because a prospective client walks into your office doesn’t mean you have to accept them. Be mindful of the “80/20” rule. In this case, 20% of your clients will cause you 80% of your headaches. Which leads us to the next tip…
Know your A, B, C’s…
Think about categorizing your clients from “A” to “D.” The “A” client is the client who appreciates your work, calls only when there is something relevant to discuss, and is a good source of referrals. The “D” client only cares about how much money you are going to get for them, has a penchant for calling incessantly, and has a penchant for either not telling the truth or not sharing key information with you. This client’s file will undoubtedly end of up your floor buried under other files and may sit long past its deadline. Get rid of your “D” clients on a regular basis.
Set the rules
When meeting with a client for the first time, provide a roadmap of how you expect the case to proceed. As a personal injury lawyer, I advise my clients that I cannot guarantee justice, only a result. I then lay out the steps for preparing and prosecuting the case. When explaining fees and payment, be it contingency or retainer, be confident and look your client in the eye. This will be the first indicator of whether or not your retainer will be regularly replenished. If the client looks down or away, be wary. If the clients nods their head and/or smiles lightly, history has shown that they not only have the ability to pay, but understands your ground rules.
Do not negotiate your fee
You set a fee for a reason. You have prepared a budget and know how much money you need on a monthly basis to operate successfully. You have a marketing plan, and your referral sources say that you are the best in your field in the area, even if Lawyer Smith is right down the road. When a prospective client meets with you and tells you that Lawyer Smith is willing to do the same work for $2,000.00 less, tell them kindly that they can then retain Lawyer Smith. If you reduce your fee, you have just lost the trust of your prospective client. You are also letting that client dictate the ground rules of the case. I am a fan of the term “you get what you pay for.” Odds are that, in time, that client will leave Lawyer Smith and retain you to handle to mess that Lawyer Smith made.
Billing early, often and strategic
Clients appreciate the services you provide, but it is really the value that you are providing that is most important. To that end, I advise my clients to bill when their perceived value is the greatest. As each day goes on after an event, your value gets diminished. I suggest sending a bill to a client after a favorable result or a productive phone call. If you send out that bill two weeks after that phone call, the client will not perceive the value to be as high.
Say “Goodbye” with affection
The end of the case doesn’t mean the end of the relationship. Your present clients are your absolute best referral sources, especially immediately after the matter is closed when your value is the highest. Conduct an exit interview, send them a closing letter, but make it a marketing letter. Ask for a review on one of the relevant sites, likes Google or Avvo. Keep the relationship alive. And remember to make the goodbye all about them.
By the way, the GP Solo and Small Firm is the largest division of the ABA and they have many resources available to help solo and small firm lawyers manage and grow their businesses. Here is a link to their Solo Small Firm Resource Center.
Peggy Gruenke is owner of LegalBizSuccess, a company whose mission is to help solo and small-firm lawyers build better businesses. Peggy is active in the ABA GPSolo Division, where she heads the technology committee and is vice-chair of the national conference committee. Follow her on Twitter @PeggyGruenke.