Guest editorial from Dan Warburton, Law Firm Consultant, Speaker & Author

The Law Firm Owners' 3 Secrets to Major Take-Home Profits While Freeing up Their Time

Having now worked with over 1000 entrepreneurs and business owners in the last 20 years, with many of these being law firm owners, I was recently reflecting on what key elements I noticed they were implementing that enabled them to increase their take-home profits while freeing up their time.

Law Firm Profits – the Three Secrets

I reviewed some of the recent conversations I've had with my clients as well as absorbing their testimonials, thereafter I narrowed down the elements to these three secrets. I call them “secrets” because most law firm owners do not understand that doing these three things can impact their performance and elevate their take-home profits.

Here they are!

People first, technology second

As many other sectors such as finance and insurance are adopting technology quickly many law firm owners are also trying to do the same thinking that technology will make their businesses much more productive and thus profitable, but this is usually not the case.

Before Artificial Intelligence (AI) can be implemented to read documents, for instance, those documents need to be arranged, stored and put to work in the right order and with the right human processes.

All this is down to a system and until a system is fully in place, agreed upon and documented in a ‘this is how we do things around here’ text, no AI or tech is going to solve anything.

Most important is getting team cohesion in place first to create and lay out the repetitive systems that everyone in the law firm agrees to adhere to.

For this to happen, first the business culture must be good; any ‘blame culture’ needs to be cleared, competitiveness needs to go out the window and only then can you have a ‘team’. By this, I mean a group of people who trust each other and will work together to ensure their firm (and each individual within that firm) succeeds as a whole.

When you get to this, multimillion-dollar law firms can be run with only a basic PC, emails, spreadsheets and nothing else. Not that tech isn’t good for increasing productivity, but it only speeds up once systems have been agreed upon first and are proven to be effective by reliable collaborative teams.

People first, tech second

The second secret:

Don’t advise, lead

One of my clients, a partner of two who co-led a team of ten, was working over 100 hours per week. As you can imagine, my client was completely burned out. Looking closer at why he was so flat out, I discovered that he was receiving over 250 text messages a week and the majority of these were from internal staff.

My client had made the mistake that most law firm owners make, building a firm that relies on themselves to run it. Law firm owners do so by continually giving advice to their team members whenever it’s asked of them and so the team become completely dependent on one person. Instead, the skill is leading your team to become problem solvers that can run the business without the owner or partners.

How to start relinquishing control and motivating your team to do it themselves:  schedule weekly (or more) one-on-one meetings with each key team member. Then use the meetings to answer their questions (but not give the answer) with your own questions thus guiding them to find the answers themselves. At first, this may feel painfully slow but soon enough this teaches them how to solve problems on their own.

Also, add to this a request that unless absolutely necessary, all communication is to be carried out only in the weekly allocated time.

We put this in place between my client and his team and as a result, he went from receiving over 250 text messages a week to barely 20 because he was then using the weekly one-on-one meetings to ‘lead’ his team to become problem solvers and not rely on him so much.

Within four months his team began to really support him, and he’s had one of his best team billing months yet.

Don’t advise, lead

The third and final secret:

Schedule it and lock it

Most law firm owners are burned out and exhausted because they believe that ‘working more means earning more’.

This is true until they are so packed with billing hours and completely exhausted that they can’t work anymore. They keep only doing what is urgent but instead, they need to also schedule in time and do what is important.

Actions such as business development to create ideal clients, interviewing to find ideal recruits, reviewing work that’s completed by their team before it’s released to the client and leading training meetings to ensure mistakes aren’t repeated are good examples of important actions.

These are actions that will create the law firm you’ve always dreamed of leading. A firm where your team does a major part or all the work, both fee and non-fee-earning work so that you can focus on the more important things such as recruiting and business development, as well as having time for yourself and your family. But these things will only happen if you schedule them in and make them non-negotiable.

Another client of mine, Kim, a sole practitioner, was stuck on a hamster wheel (her law firm!). She had built up a great reputation for providing employment law solutions, so the work kept pouring in but of course she’d do all the fee-earning herself.

She was exhausted and couldn’t see a way out.

The first thing we did was to schedule time to lay out her ideal revenue and team plan. We then hired recruiters to be available for interviewing, and worked on time to train and review new staff members’ work.

As a result, her firm made an extra £192,041 in revenue in 12 months, greatly increasing her take-home profits and while she reduced her weekly hours from over 70 to 35.

Schedule it and lock it

I hope my three secrets are helpful! 

Dan Warburton is a Speaker & Bestseller Author GET IN TOUCH