Why Some Firms Survive and Some Don't

I remember years ago learning the 4 Ways to Grow any Business.


Some people say that Jay Abraham created the "4 Ways" and others say that it was Michael Gerber.  I think that I can go further back to a seminar in the late 1980's by a chap called Jackie B Cooper when they were listed in a workbook.


No matter who it was, I still recall the time when Mr Cooper talked about answering the phone.  He said, pick up the Yellow pages and call ten businesses at random.  And he bet that for eight of the ten firms answering, you would have no idea who they were.  The gist of the issue was that how you answer the 'phone can have a big bearing on how much profit you made.


And over the years, I think he's right.

Fast forward to 2012 and if you were to randomly call ten law firms, you would be hard pressed to make out who they were.

Then try this; leave a message and ask for a call-back from a lawyer.  I've tried it and guess what?  80% of them never called back. 

Now go to ten law firm websites, you would see the same old tosh on virtually every site, with nothing to differentiate them.

Things such as:

"We have been in business for 200 years"

"All our lawyers are legal experts"

or simple brochure sites where you can't call anyone or email anyone.

Two simple examples of what's wrong.  To become better, simply do the opposite of what failing firms do.

Answer the phone properly.

Make sure that your website doesn't suck.

But it doesn't stop there.  In reply to an email that I received from a lawyer who asked me why some firms survive and some don't, here are the Top Ten reasons why firms survive:

• Greater emphasis is placed on the delivery of current of legal knowledge to active fee earners.
• Everyone uses the right technological tools such as laptops, email and Internet.

• Lawyers paralegals and fee earners of all kinds practice in specialist branches of the law. Specialists are more successful than general practitioners.They choose the type of work which is plentiful and profitable.
  

• Money is spent wisely. The question is always: what is the return on the cost/investment? More specifically, successful firms spend more money on marketing, computer systems and software, productive employees, knowledge improvement and motivation of employees.

• A great deal of attention is given to accounting. Partners who regularly  look at cash flows, outstanding debtors, fees debited, work in progress, new matters opened, transfers from trust to business, bank reconciliation and other reports, almost always do well financially.

• Reporting to clients is better. In some matters one must report once a week to clients, in others once a month. But regular reporting to clients is an essential element of success. With today's technology, reporting by email is quick and effective. After all, more clients will leave a firm who is perceived as "not caring" than for any other reason.

• They pay better. Remuneration is based upon performance. A salary should only be part of remuneration. A major part of remuneration of any employee should be based upon fees which that person has generated. But more, the remuneration should be based on fees actually collected, in other words, the cash flow contribution of an employee.

• They spend time on recruitment and appoint the right employees. The right person for a particular position is vital. Spend more time in interviews and ask many more questions. Ask other staff members to conduct interviews with the prospective employee and require their opinions on personality, attitude, skills, including people skills, employment history and remuneration.

• They treat all employees as people, not as disposable parts of the business.  The receptionist is as important as any partner.  Treat her right!
• They follow up on enquiries with a systematised process.
• They use social media properly.

There you go.  Now you have the top ten, set to work and make sure that your firm is one of the firms that survives.