The National Creditors Bar Association Law Practice Management Blog

Law firms tend to not track things well.  That includes time and billing, where they regularly tend to leave hours on the table.  But, it also extends to other parts of the practice.  So, when was the last time you examined your budget?   Lawyers who know their overhead are empowered because they have a baseline idea of what they need to make to keep the lights on, and what they need to make over and above that to earn a comfortable living.  Knowing those things means that the law firm can better forecast revenue and also set revenue goals, both of which are important to effective law firm management.   This all makes sense; but, the challenge lies in creating a current snapshot of the law firm budget.  Many managing attorneys don’t track their expenses effectively, which means they never get an accurate sense of their overhead, which by extension means that their revenue projections are less likely to be accurate and the revenue goals are less likely to be...

Law firms operate between ad hoc decionmaking and fire-putting-out.  It’s the natural state of the law firm manager.  That being said, humans have been improving on the state of nature since there have been humans.  So, it’s maybe not the worst thing in the world if this is the year you decide to put together revenue projections for your law firm. If you’ve never done it before, start now.  (Don’t wait until January, and cram this in, like everything else in your life.). The reason you create revenue projections for your law firm is because you need goals, just like everybody else. If you don’t have revenue goals to strive for, you’re far more likely to accept the status quo (even if you don’t like it), and your law firm will begin to stagnate.  Applying revenue goals applies pressure, gets you out of your comfort zone and (spoiler alert): will likely mean you actually make more money, even if you don’t ultimately hit your projections right away. I...

Modern law firm consumers are an entirely new breed.  They have more law firm options than ever before, and aren’t afraid to use them.  They are committed to mobile search.  They are more cost-sensitive than any consumer base in modern history.  Absent a near-instantaneous response from a potential lawyer hire, they will immediately move on to the next attorney on their list. This can be frustrating for law firms, whose billing practices tend to be antiquated.  Hourly billing, without a cap, is perhaps the scariest consumer pricing arrangement there is.  Put yourself in the shoes of your potential client, and ask how appealing it would be to sign an agreement undefined in length, and with a high hourly rate attached.  Furthermore, if you’re asking for retainers, consider whether you’d be able to draw that cashier’s check on your own bank account, on short notice. The good news is that these two obvious roadblocks to client engagement fo...