It is not often that I find articles that are filled with good business advice and directed at lawyers. This handout from Drive Revenue is a good read, not only with new ideas, but also to remind everyone of the things that have been forgotten.
So often as professionals, we become so involved in doing our best work, we lose sight of the fact that our practice is also a business.
Managing a Practice and doing great law is a monumental task. The paper work required to get paid, managing your trust account and churning out the work to meet deadlines can take its toll.
We at Drive Revenue understand these pressures. After years of running and managing successful law practices and creating order in the systems and processes that support law firms and other professional firms, we have developed Drive Practice, a cloud based online accounting system that puts your law firm in order.
Over many years, dealing with busy business leaders we have distilled some year-end reflections that will help you to focus your efforts on putting your business in order in a way that will not erode enormous amounts of your time.
REFLECT ON THE YEAR THAT WAS
Consider carefully the things that worked well in your practice.
Did your billing go out timeously?
Was it easy to generate and send your invoices and to follow up on only the exceptions?
Did your clients find your invoices easy to read?
Did you know how much was in trust when you needed to do a transfer, or to ask for a top-up?
Were all your disbursements billed?
What didn’t work?
Understand fully the areas of your practice that cost you time.
Did your clients consistently query your bills?
Are your disbursements accurately and timeously recorded?
Were you able to account for sales taxes effortlessly?
Did your clients perceive the value of your services?
Will your clients give you repeat instructions?
Are you able to see when clients are giving you repeat work or referring work to you?
What should you stop doing?
Determine areas and activities that don’t increase your revenue and bottom line.
Are you eroding your potential for growth by doing things manually or using disparate systems?
Do you take on work just to keep the WIP going without consideration to the work you’re best at?
Do you employ support staff to help you manage your practice and get frustrated when they let you down?
What should you start doing?
Design processes that will generate revenue by creating transparency through better customer relations.
Have you considered a systematic approach to your matters?
Do you explain the processes and your billing to new clients ahead of concluding a mandate?
Are you able to look at your client’s record when discussing their matter so that you can advise them of the WIP to date, call them on outstanding bills or ask for a top-up deposit?
ANALYZE YOUR CLIENTS
Let’s face it, getting a continuous string of new clients is not easy in a highly competitive market. And those that are good clients we want to hang on to.
Looking into your clients can be enlightening and most systems won’t give you an overview of the client as a whole as each matter is treated as a separate entity.
A system like Drive Practice allows you to link clients and matters over years to gain insights into which are your most important clients.
Rate your clients.
Rank your clients using criteria such as revenue for the past couple of years, timeous settlement of account, referred business. Having linked data available is enormously valuable and it is remarkable how often we write off a client because we haven’t procured great revenue from them in the year that was, never seeing the effect their referrals and past revenue has contributed to the practice.
Where did your new clients come from?
Tracking the source of new clients speaks to the link above. Referrals still remain the number one source of new business. Sure, a new client may have gone and checked out your website, but most often they did so because they had heard about your practice first, then they googled you.
How do you reward your best clients?
The most successful lawyers we know are constantly in contact with their best clients, having formed a relationship of trusted advisor to them. From knowing everything about their business and families, to advising them on where the best wine deals, restaurants or holiday locations are, you need to work those relationships. And yes, this takes time. All the more reason to know who your best clients are and to only spend that time with those that qualify.
So whether it’s a reasonable gift once a year, or a bit of free advice for a friend or family member of theirs, reward those clients with your presence, call them quarterly and make them feel special. Like their best friend is a lawyer.
How do you let your worst clients go?
Almost everyone we know hates losing a client. Losing a client, though, can be cathartic. If you are rating your clients correctly, you will know which ones can and should be let go. To continue doing work for them, while apparently generating revenue can also be very expensive. Expensive in unpaid bills, time that cannot be recovered, or worse still, reputational damage to your practice.
Knowing who the time wasters and expensive clients are goes a long way to being able to not take their next brief, or to have the tough conversation that unless their business with your practice is conducted in accordance with your terms and conditions you are not able to represent them and their files will be handed over to their new representative upon settlement of their account in full.
FOCUS YOUR EFFORTS
Why does your business exist?
So you love the law – we get it. Do your clients get it? Or do they see you as just doing a job to earn a buck? Doing what you do, well, brings the money. With a focused vision of just how and what you do that is special goes a long way in helping clients trust you with their work. Distil why your business exists into no more than 3 statements, and then walk that talk.
What do you need to do to realize this?
Make sure that from the very first interaction a client has with your practice, the methods you employ, the standards you set, the documents you prepare, the tone you interact with them and with their matter align with the promise of your vision for the practice.
How will you do it?
Put the right systems and processes in place to support your practice. The reason your practice exists will indicate what you need to measure and record in your practice so that you can deliver on your mandate and manage your business effortlessly.
Your processes need to be designed to support your vision of delivery to your clients. Most practice management solutions don’t give you the flexibility to set your measures and configure the system to how your practice needs to work.
The best money you will ever spend will be with a business professional who will quickly understand just what you need to know to manage your business well and how the systems and processes should be designed and configured in your solution.
Drive Practice is sold and supported by experienced business systems experts who will transform your practice. Be a #21stCenturyLawyer and contact Drive Revenue for a reseller near you to accelerate 2017 for your practice.