The practice of making New Year resolutions is thought to have stemmed from the Babylonians, according to the History Channel. Citizens of this ancient people would reportedly vow to return borrowed farm equipment and pay off debt.
While the account makes no mention of track record for sticking to those resolutions, both appear to center on financial well-being.
It’s in the same spirit we call out these small law firm New Year’s resolutions stemming from a white paper written with author and practice management consultant Ann Guinn: Nine Proven Strategies to Help Earn What You Deserve at Your Law Firm.
1. Resolve to Create a Vision.
Most small law firm owners don’t have a vision for their practice, says Ms. Guinn. “They just open up for business and assume that clients will come to them, and they’ll make some money, and that’s it,” she writes. A vision is the foundation of a business plan and answers five key questions:
- Where do you want to go?
- How will you get there?
- Who will help you get there?
- How will you measure success?
- Where are you in relation to your goals?
2. Resolve to Lose Underearning Habits.
Underearning comes in two forms: passive and active. Passive underearning “is choosing not to do something or failing to do something that would have resulted in you making more money.” Examples include: discounting fees, giving time away, not capturing or accounting for billable hours, and procrastination. By contrast, “active underearning is knowingly doing something that will cause you to underearn.” Examples include “rationalizing low income, not working enough hours, accepting bad cases and clients” the white paper says.
3. Resolve to Build New Profit Centers.
How can small law firms maximize profit centers? By looking for ways to cross-sell clients where it makes business sense, identifying market opportunities and streamlining process for efficiency.
“Create an extension of your existing business or a new business altogether,” says Ms. Guinn.
“I’m thinking in terms of a staff person who would love to be able to learn how to do some shepardizing, or cite checking, or drafting, or whatever. You may have an associate attorney that you could train to new revenue-producing skills. Add services or practice areas that are frequently requested by your clients. Leverage a practice with paralegals and contract attorneys.”
4. Reach Billable Target Rates
How do small firm lawyers decide what rates to charge? There are several typical answers according to Ms. Guinn:
- I check to see what the competition is charging.
- I think what might sound reasonable.
- I consider who my target market is.
Most of these are based on gut feelings, where Ms. Guinn suggests the correct answer is “I considered how much money I need to make per hour and then went from there.” She offers this formula for consideration:
5. Resolve for better work-life balance.
The median number of hours lawyers work is 50, according to the ABA Journal. That statistic tends to be higher in larger firms and many would agree there’s a culture prompting attorneys to work even more; long hours are a badge of honor. The story is similar among small law firms, where managing partners tend to undertake tasks aside from law including strategic planner, marketer, accountant, and customer service advisor among others. The key may well rest in the resolutions, strategies and tactics listed above.
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Even if you have little debt and no farm equipment to return you can get a jump on the New Year by downloading the complete white paper – Nine Proven Strategies to Help Earn What You Deserve at Your Law Firm.
Ann Guinn is a practice management consultant to solo and small firm lawyers and the author of Minding Your Own Business: The Solo and Small Firm Lawyer’s Guide to a Profitable Practice.
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