Wednesday, June 10, 2015

Law Practice (and other business) Fundamentals

Due to deep seated psychological reasons, which years of therapy have not remotely addressed, I always believed I could not draw, paint, or do anything remotely "artistic". It's got something to do with my mother being an artist, and worrying too much about what other people would think about my artistic efforts. And yes, Dr. Freud, I know I married an artist, just to keep you amused.

However......once, in preparation for giving a talk on "Building a Law Practice", I made a little illustration. This is the only known work of its kind, created by my very hand.....
If I do not explain the meaning of this relic, I fear it may be later discovered and subject to mis-interpretation. The drawing is called "Law Practice Fundamentals". A law practice, or ANY business, is based on THREE basic things:

1. Getting the business.

2. Doing the work.

3. Managing the finances.

If a law practice (or ANY business) is having "problems", the source is often one (or more) of these issues.  All these issues can be addressed and improvements can be made.  This is a matter of clear thought, action, assessment, and adjustments.  All the things we all know and sometimes even do.

The BIG challenge is to work all three elements simultaneously.

Most new law practices consider themselves initially challenged with Item #1.  I maintain this is easily overcome, and once business is brought in, the challenges of #'s 2&3 will present themselves.  Of course, once we are working really hard (probably too hard because we half didn't expect to succeed at #1), the inclination is to stop getting new business and/or lose track of financial issues.  After all, we are SO busy, so things must be OK.

Then, after we do all that work but the bottom line doesn't measure up, we focus on that.  And fall behind on the actual work, and of course, still no time to go back to #1. 

So then, we work on #3 and chase down some money, but we have no new business, and so we begin the treadmill again.

Try not to do this.  Or shall I say....DON'T DO THIS!!!!

These things are all related and inter-related. 

When you market and network, have systems in place to handle the work efficiently.

Make good decisions on which matters to take (and reject) and think about the fees and billings and collections at the outset.  Money problems generally arise out of defects in #'s 1 & 2.  (We market for or accept unprofitable matters or we work inefficiently)

Law practice (or any business) requires seeing all 3 elements, and addressing them consistently.

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