Flat Fee Engagements need Change Orders to deal with Uncertainty

 

signature with pen iStock_000016280370XSmallOne reason lawyers have difficulty charging flat fees is they don’t know how to deal with the uncertainty. Uncertainty that arises because they don’t really know how much time they will spend because of the unknown actions and extra work that might result because of this particular client’s needs or demands.  

 

Use Change Orders, similar to those used in the construction industry, to help with some of the uncertainty.  You’ll have to spend time planning the scope, structure, and systems that your practice will need to accommodate both the flat fees and the change orders.  But you’ll find the effort more than worth it in the long run.

 

Start with a Fee Engagement Agreement that clearly sets out the scope of your work with sufficient detail to earn the flat fee.  Include your Change Order form for additional work as an exhibit to your Fee Engagement Agreement.  Then have systems in place to remind you to have your clients agree to the additional work at the additional fee before you do the additional work.

 

If you would like coaching on how to make your law practice more profitable, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

 

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10 Hiring Mistakes to Avoid

Create a Hiring Plan

If you’re a solo practitioner and it’s time to make your next or first hire create a hiring plan that will help you avoid making the following ten hiring mistakes. If you’re one of those lawyers that worries about your hiring decisions take the time to think and plan your next hire.  Planning is the best thing you can do to avoid problems in all areas of your law practice.  

By the way, I’m not suggesting that lawyers are any worse than other business people at making hiring decisions, just that for very smart, careful people I’ve found this to be a common practice management area that proves challenging for many lawyers.Target hiring well

Here are 10 hiring mistakes you need to avoid to successfully grow your law practice.

Hiring Mistake #1

Hiring the first person that comes along. 

Hiring Mistake #2

Not having a clear idea of what you need in your next hire. 

Hiring Mistake #3

Not having a clear idea of the skills set that the new hire really needs to meet your objectives.

Hiring Mistake #4

Not asking the kinds of questions that will really reveal the true self and skills of the potential candidate. 

Hiring Mistake #5

Giving up when you feel you keep hiring the wrong the person and decide not to hire anyone else rather than figure out what you can do differently to find the right person.

Hiring Mistake #6

Assuming that if the candidate is expensive they must be good.

Hiring Mistake #7

After hiring the person not giving enough or any mentoring or guidance to help the new hire succeed.

Hiring Mistake #8

Not investing the time necessary to ensure a good hiring decision.

Hiring Mistake #9

Relying on others to find the new hire.

Hiring Mistake #10

Waiting until your workload reaches such an extreme level that you don’t have time to hire properly and make all the above mistakes.

To avoid the mistakes have a hiring plan that addresses each of the above mistakes. 

If you would like coaching on how to reduce the age of your account receivables, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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Ten Rules to a Successful Law Practice

How to Have a Successful Law Practice 

This month’s Law Practice Management post is written by guest writer Sarah Weaver.  Sarah is a happy and successful solo bankruptcy attorney located in Seattle, WA. 

I’ve had the pleasure of working with Sarah for the past ten years and I very much appreciate that her first rule to having a successful law practice includes working with an experienced lawyer business coach. 

The following are the ten rules to Sarah’s highly successful law practice as covered in her CLE presentation materials for the WSBA Solo & Small Firm Conference to be held in Vancouver, WA this July.

If you follow her suggestions you too will have a successful law practice. 

CELEBRATING TEN HAPPY YEARS OF SOLO PRACTICE

On September 15, 2013, I will be celebrating ten years of a successful solo practice, which is a great time to reflect.  “Success” has many definitions and just as many paths to achieving it.  What follows are the guiding principles that have worked for me.  In September of 2003, I had been a lawyer for just over 23 years so I had the advantage of a healthy line of credit to set up my practice, a well-defined practice area (bankruptcy – primarily from a debtor’s perspective), and a long list of contacts that I hoped would translate into referral sources.  On the other hand, I did not have a single client to my name, I had never run a business, and I had no clue about how to buy health insurance, what retirement plan to set up, where to rent an office, or the myriad list of other things that needed to be done.  So, here is “rule” number one:

1.                  Give yourself every chance to succeed.  In the early days, that meant two things for me.  First, I hired a coach experienced in working with lawyers.  Irene Leonard has been invaluable to my practice.  I knew she would keep me on track, challenge my assumptions, and push me when I needed it.  She did and still does.  Second, I hired a graphic designer to design my business card, stationery, and envelopes.  It was important to me to present a professional look that would inspire confidence in those who might send business my way.  Both were significant investments in my fledgling practice that have served me well.   

2.                  Pay attention to how you work and design systems that work for you.  Try as I might, I could never figure out how “practice management software” would work for me.  I had survived many years in practice with a stack of yellow legal pads, Outlook, Word, and Excel and saw no reason to invest in a more comprehensive program that I would need to learn and upgrade periodically.  I stuck with what I already knew, and that has worked for me.  My client files are red, my administrative files are blue, my files are organized alphabetically, and my intake sheets are a bright green so they are easy to spot in the file.  When a matter is finished, my notes are scanned and saved in the client file, and the file is dragged and dropped into the “clients – completed” file on my hard drive.  Simple and easy.

3.                  Invest in your practice . . . or just because you can, doesn’t mean you should.  Lawyers are smart people, and we love a good challenge.  I drew the line, however, on the challenge of setting up templates and pleading paper and figuring out how to delete the firm logo from the second page of a letter.  I hired a pro experienced in setting up templates for larger firms and whatever I paid her was well worth it!  I know I saved hours of frustration and time better spent marketing or doing billable work.  I also invested in excellent bankruptcy software, a good time-keeping program, accounting software, and a subscription for legal research. 

4.                  Marketing – think about where you want your business to come from and show up consistently.  In the early days of my solo practice, that meant joining and becoming active in the KCBA Solo & Small Firm Section.  I met many excellent lawyers, learned a great deal from them and from the presentations at the luncheon meetings, and made many good friends.  I also hoped to become the only bankruptcy lawyer they needed to know.  I also continued my involvement with KCBA’s Bankruptcy Section and the WSBA’s Creditor-Debtor Section and joined WBO, the women business owners’ group.  By showing up consistently and earning the trust and confidence of others in the group, my practice has benefitted from many great referrals.   

 

5.                  Marketing – do what’s comfortable for you.  I am a “joiner” by nature and that has worked for my business.  I would rather spend an hour over lunch reconnecting with a colleague or planning a CLE than writing a scholarly article for the Bar Bulletin or NW Lawyer.  For the more scholarly among us, however, those are excellent vehicles to establish your reputation.  About marketing, a friend once told me “If you do nothing, nothing works,” and the point is to figure out what works for you. 

6.                  Trust your intuition – especially with clients.  In the early days of my solo practice when times were very lean, I told potential clients that what they wanted me to do would cost a great deal and would likely not be successful.  Despite the prospect of a significant retainer, I had visions of defending the indefensible, being miserable in the process, and losing.  I remembered the promise to myself always to follow my intuition, and it was a good decision.  Turning down business, especially when times are tough, is one of the hardest things we do.  I do need the occasional reminder, and it typically comes in the form of an unpaid receivable.  So, listen to that little voice in your head – it knows things! 

7.                  Finances – save for taxes and periodic expenses.  I hate surprises, especially when it comes to money.  I well remember the day when my CPA told me that my additional tax bill would be $20,000, which I did not have sitting in my business checking account.  While I had been good about setting aside money for taxes every month, I suddenly became very good at it.  I now do the same for the yearly malpractice insurance premium, charitable donations, and retirement contributions.  Knowing how much I’ll need when the bill comes due is a great motivator and having the funds set aside is a great stress reducer. 

8.                  Cyclical practices can be a challenge.  Bankruptcy, by nature, is a cyclical practice.  Although it has been a very good few years, business has definitely slowed for many of us.  As in the early days of my solo practice, I tell myself “It’s not true that no one will ever hire you again.”  I know the phone will ring and new clients will appear.  The challenge is to turn that nagging worry into action – tackling the “to do” list, reconnecting with colleagues, volunteering to speak at a CLE – and enjoy the time the universe has given you to do other things for a bit. 

9.                  Build a good team and know where to ask for help.  Help is often just a phone call away, and I have enjoyed connecting with people who know things I don’t.   An expert, whether it is in practice management, a different area of practice, or the latest technology, can be a great time-saver.  The trick is being able to identify who can help you (or your clients) when you need it.  Of course, be prepared to return the favor when a colleague calls you for help!

10.              Enjoy your clients, celebrate your successes, and stay organized!  It is a privilege to practice law and to make a difference for those who need our help.  Don’t forget to acknowledge all that you have accomplished and to give yourself the occasional pat on the back. 

Written by Sarah Weaver,

Attorney at Law

1325 4th  Ave Suite 940

Seattle, WA  98101

206 388 0138

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Many Relationships Are What You Need to Build Your Book of Business

Being Good is not Enough

Being good at what you do is not enough to build your law practice.  I learned that the hard way early in my legal career. When the recession of the 1990s’ hit I was laid off of my general counsel job and needed to find a new job.  I quickly ran out of people I knew who could help me find an opportunity. 

My network of colleagues was limited for two reasons.  I was from Canada and didn’t grow up in the country let alone the city I was working in and wanted to stay working in.  But the main reason that I didn’t have enough people who could help me in my networking attempts to find new employment was that I never did any networking when I moved to Seattle. 

Don’t Make This Mistake

I focused my efforts on all the work I had and doing a good job on the work. I didn’t realize what a mistake I made not building a network of relationships outside of my company or the lawyers that worked for me.  I actually turned down opportunities to have lunch or attend events because I was so busy.  I didn’t realize the importance of building a network of business relationships. People referring to you I do now! I would rather you learn from my mistake and not your own. 

Marketing Means Having a Large Number of People on Your Side

The best thing you can do to build your law practice is to have a large number of people on your side.  People that you can contact when you need help or new clients. Even if you are an introvert there’s no excuse to not build up your contacts list. Use social media to help build your network.

My story has a wonderful ending because it took so long to build enough relationships to find a job that I built my law practice instead. The even better ending is that when I wanted to build my business coaching practice (when people didn’t know what that was) I knew enough people that trusted me to help me make a success of that!

I’ve also pleased to have lawyers hire me to help them build their book of business because they thought that if I could build my coaching practice then surely I can help them build their law practice.

If you would like coaching on how to build your book of business, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

 

 

 

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How to Shorten the Time of your Aging Account Receivables

Get Paid Promptly

Three Invoices All With Paid StampHere are eleven things you can do to get paid promptly and reduce or shorten the time it takes for your aging account receivables get paid.  Most lawyers agree that one measure of law practice success includes getting paid promptly.

The following pointers should help you take control of your aging accounts receivable, and get paid in less than 90 days.

1.       Talk about money with your clients from the beginning.

 In my coaching practice, I’ve found that asking or talking about money with clients is a common fear for lawyers.  Make it one of your law practice habits to bring up the issue of payment during your initial phone call or meeting, as well as during your representation.  Find ways to get over your reluctance or fears of asking for money

2.       Charge reasonable fees.

Advise your potential client up front how much the representation is likely to cost so they can make a decision whether they want to go ahead.  Help the client appreciate why your fees are reasonable based on that has to be done for the client.

3.       Be willing to turn new clients away. 

Don’t take a client who can’t afford you or when your gut tells you, “No.”  Your gut is usually a good judge of clients who aren’t going to pay.

4.       Obtain an advance fee deposit.

 This is simple – if you have money in trust you get paid quickly. This is the ideal way to take control of your accounts receivable and get paid promptly.

5.       Maintain “ever-green” trust accounts. 

Have your clients replenish their trust accounts making sure the amount in trust doesn’t dip below a threshold amount while you are acting for them.

6.       Have good relationships with your clients. 

An often-overlooked tip for getting your accounts paid is to make sure your clients like you.  If they like you, you are more likely to be paid.

7.       Be good at what you do and give your clients great value. 

If you are good at what you do, that will reduce client complaints or rationale for not paying your account.

8.       Render detail invoices that clients don’t question. 

Provide enough detail and explanation such that your client has a clear and appreciative understanding of the work you performed.

9.       Invoice promptly and frequently. 

Clients pay bills sooner if they receive your invoice closer to when you performed the work.  Send your final invoice as soon as the matter is completed when the client still appreciates what you did for them.  Don’t wait until the end of the next billing cycle.

10.   Be proactive when monitoring your receivables. 

Have systems in place that keep you informed of who, how long, and how much is outstanding so that you can follow up with delinquent clients.

11.   Ask your client why you haven’t being paid.

Early in the process find out why a client isn’t paying you. Don’t wait until the account is over 60 or even 40 days old.  When you leave it too long it becomes more difficult to collect.

Regardless of what state your accounts receivable currently are, you can take steps to improve your collections for future matters.  The feeling of satisfaction and success will be worth any uncomfortable feelings you might have to overcome in order to develop the habits that will reduce your aging account receivable problems.

If you would like coaching on how to reduce the age of your account receivables, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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Happy Clients Generate More Clients

Grow your law practice through your existing clients!

The best ways to increase your law practice client base is to build on what you already have.  Build your client base by maintaining excellent client relationships with the clients you already work with.

Strengthen Client Relationships

Strengthen, bolster, and maintain your existing client relationships by:

  • Knowing personal details about your clients over and above what you need to know to give them legal advice.
  • Follow up on those personal details. Send cards or write notes or emails celebrating the wins; send cards to sympathize with any loses. Finish conversations with clients by remembering and referring to the personal details of their life.
  • Keep in touch to find out what challenges they are facing in their business or career.
  • Send information to your clients that is directly related to something that will help them in their business or their life.
  • Visit your clients’ place of business.
  • Invite your client to share a quick cup of coffee just to connect.
  • Let your clients know why you like working with them. For each of your clients come up with what you like about them. What do you value about them? Then let them know.

Loyal Clients Make Referrals

Maintain loyal clients that will always think of you whenever anyone they know needs a lawyer by doing two things – providing outstanding legal services and maintaining strong, positive relationships with your clients.  Keep in mind the values of excellence, connection, trust, commitment, reliability, loyalty, warmth, support, and respect in all your dealings with your clients.  Treat your clients the way you would want to be treated and your interactions will engender loyal clients.

If you would like coaching on how to strengthen your clients relationships, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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Resist getting angry with other lawyers during negotiations

Getting angry is harmful to clients

Getting angry or frustrated with the lawyer on the other side during negotiations doesn’t help your client’s situation. In fact it usually harms their situation and your ability to negotiate strategically or competently. In order to resist being angry it might sound trite to say it, but you need to first notice that you are getting angry or frustrated and then stop talking or stop the behavior that exhibits your anger.

Never do or say anything out of anger

A good rule for you to have is to never say or do anything out of anger.

Tactics to help you handle your anger

You’ll need to support your rule with tactics that will help you handle your anger constructively.  First quiet your mind and breathe before you say or do anything further.

Then rather than retaliating or escalating the disagreement, decide to take responsibility for your part in the escalation of the exchange.  Apologize and come up with a question that can help you get the negotiations on track to the conclusion you’d really like to have happen for you and your client.

For example: You’re right about that point.  What is most important to you? or What do you really want to achieve if we agree with your position?  

If you would like coaching on how to stop getting angry during negotiations, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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Seek Feedback from Clients during Representation

Good to Great Legal Service

Some lawyers get feedback from their clients on how their services were after a transaction or law suit is completed.  That’s a good idea.  A great idea is to get the feedback when you can do something to help your client when they need it – while you are working with them.

Getting feedback on how you’re doing is also an effective way to maintain a good relationship with your client that leads to future work and referrals.

Seeking feedback from your clients during your representation gives the client what they need and want during the matter. Although clients appreciate lawyers that want to do better in the future, they would rather their lawyer did better during their deal.

Ask Good Questions

Don’t wait until the end of your representation to find out how you could serve your clients better.  Ask your clients today:

“What more can I do to make this transaction easier for you?

“How well is my office handling your matter?”

What could I be doing better?”

Ask open ended questions like the above.

Consider this analogy of restaurant service to put into perspective the importance of getting feedback while you can fix the problem. How do you feel about a restaurant where the waitperson does not ask how your meal was until you’re finished, if at all, and there were things that could have been improved had the waitperson checked in with you so you could voice your concerns?  I expect you aren’t happy.

Many times your concerns aren’t a big deal – otherwise you would have sought them out and had the problem fixed.  But those small concerns impact your overall sense of the service of the restaurant and you aren’t likely to refer that restaurant or return.

Also, consider how much you appreciate the waitperson that quickly checks in after the delivery of each course and then very politely gives you what you want or need. That’s the kind of service that instills loyalty.

Instill Loyalty

That should be the kind of good experience you want to give your clients – an experience that instills loyalty. Do this by finding out what you can do better as early as possible and then do it respectfully and politely.

Getting feedback to fix any small concerns as they arise is critical to keeping clients loyal.

If you would like coaching on how to ask for feedback from clients, please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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Become a Better Writer and Produce Docs faster with WordRake

WordRake Software Helps Lawyers Become Better Writers and Produce Documents Faster

This month’s Law Practice Management post is written by guest blogger Christy Burke, Founder of Burke and Company www.Burke-Company.com  and regular columnist at Legal IT Professionals. WordRake, is one of Burke’s clients.

 Lawyers must be excellent writers, but they also must produce briefs, memos, and contracts quickly.

Imagine a tool that could not only teach lawyers how to write better, but simultaneously and quickly could also edit your documents.  Lawyer and New York Times bestselling author, Gary Kinder, has created that tool.  Drawing on his 25-year career teaching lawyers how to improve their writing, he worked with a team of former Microsoft engineers to create the WordRake software – a tool embedded in your Microsoft Word toolbar. They now hold six U.S. patents for their methods.

Although any professional organization can benefit from using WordRake software, law firms particularly rely on it, because more rides on the words of lawyers than on the words of any other profession.  The beauty of the tool lies in its simplicity: compose a document in Microsoft Word, hit the “Rake” button, and accept or reject the WordRake software’s suggestions.

WordRake software will edit a 10-page document in about 30 seconds, detecting and highlighting words that add no meaning.  It helps lawyers – and their clients – save time and money.  And it’s there every hour of every day, the editor all lawyers need.

Experience WordRake software with a free 3-day trial at wordrake.com. Also on the website you can see the “Rake” in action through a fast and easy demo.  It is definitely worth trying this tool, deemed by WordRake customer Robert Cumbow “a miracle drug.”

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Are You Having Fun?

Discovering Fun in Your Law Practice

As a business coach for lawyers I often find myself helping my clients discover how to have more fun.   So as well as helping them set professional career goals, I also help them set goals that help them have more fun.

We start with using a simple life satisfaction assessment tool that includes “fun and recreation.”  Many lawyers have a tendency to give themselves a low score when they answer the question, “How satisfied with fun in your life are you?”

Start by Determining What’s Fun for You

Many people don’t consciously know what’s fun for them.  Here are a few things my clients find fun:

  • Enjoying time with loved ones
  • Playing, practicing, and listening to music.
  • Getting billable hour goals meet early so they can leave and spend time with their children.
  • Taking a day off each month to do whatever they want.
  • Increasing the amount of vacation time taken from year to year.
  • Eating fine food at wonderful restaurants.
  • Reading page turning novels.
  • Taking long hikes or walks in newly discovered parks.
  • Long distance running, spin class or Pilates.

What’s important is to confirm your own definition of fun not someone else’s.

What’s it Take To Have Fun?

The practice of law is demanding and if you don’t make having fun important, then you’re probably finding you aren’t having enough fun.  Here are some goals that might help you increase the amount of fun you have:

  • Leave the office by 6 p.m.
  • Read 12 books for pleasure by a date certain.
  • Plan specific fun activities with each child.
  • Take a course for pleasure.
  • Have lunch with a good friend twice a month.
  • Laugh out loud at least once a day.
  • Listen to music in your office.
  • Train with others.
  • Improve your golf score by a date certain.
  • Create a backyard oasis by the end of the summer.

The above are examples of having fun outside of work.  Here are some things you can do to improve your fun at work satisfaction level:

  • Only work with clients you enjoy.
  • Only work on rewarding matters.
  • Only work in an office with people you like.
  • Work in an environment that suits you.
  • Make your work interesting.
  • Change your practice so you can reduce the number of hours you spend working.

Develop a Fun Attitude

Attitude goes a long way to having more fun in your practice. You can choose that you’re enjoying yourself and having fun or that what you do is a grind.  Shifting your attitude may be all you need to do to notice the fun in what you’re doing.

My idea of fun is dining with friends, reading page-turners, going to the Seattle Art Museum, and volunteering at the animal shelter.   My work is fun because I like all of my clients and I take such pleasure from helping my clients achieve amazing career successes!

If you would like coaching on how to have more fun in your law practice I’d have fun working with you.  Please contact me , Irene Leonard, Business Lawyer Coach to see how I can assist you.

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