LawBizBlog : Law Practice Management, Lawyer Coaching, Legal Consulting, Law Firm Retreats : LawBiz Blog : Ed Poll

The following note is prompted by the comments of Susan Cartier Liebel of Solo Practice University®  and her post about Kimberly, a young mother who just gave birth to her third child and was a 3L law student at Stetson. She became ill but failed to go to a doctor to address her own health. She was busy with her family and "stuff."

This is for all of you out there whether lawyer or law student, mother or father, who puts
themselves last. You put off going to the doctor for that chronic cough while you rush your child to the pediatrician for a hang nail. You eat your cold dinner out of a jar standing up and talking on the phone while you make sure your child’s meal is hot and she’s seated lest she choke on her food. You do so because ‘you can handle it’. Well, here’s the truth.  You can’t.

You can’t care for your kids or your spouse if you break down physically. You can’t care for your clients if you don’t take time to reinvigorate and refresh.  Remember the airline admonition: Put your air mask on first and then help your child and others around you. None of us are superhuman or immortal. There is nothing more important than your health, no final, no brief, no exam, no trial, no event.  Remember this the next time you get no sleep or ignore that persistent cough or inexplicable pain in your side because ‘you don’t have time’ to slow down. Remember you can break down, too. No machine and certainly no human can work without stop and without repair from time to time.

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There are at least two components of legal costs:  Fees and expenses. When one is clearly out of line, the other is perceived to be out of line. Perception is reality.

Much has been written about the $1,000 per hour legal fee. It's out of line, too high, much too expensive, etc. But the writers fail to assess the competitive market for those services and whether those services have some very special expertise connected with the fee that justifies the fee. If, for example, you're in a "bet the company" situation, you want the best lawyer you can get. If you're in a criminal trial as was OJ Simpson, you want a particular lawyer and team of lawyers. You will pay the asking price.

If you're facing a normal contract dispute, one might consider this a commodity type of legal battle, one not requiring the best lawyer in the state; a good lawyer will suffice and the cost of his/her services will be adjusted downward accordingly. Some call this commodity pricing.

If you're a very large bankrupt company, you need specialized professional expertise. According to Bankruptcy Court filings (attorney fees need to be approved by the judge), many lawyers in this arena are receiving $1,000 per hour. Nothing out of the ordinary here.... this is reality. 

However, when these same filings show application for expense reimbursements that are out of the ordinary, then questions arise. For example, why should the bankrupt estate pay for first class airfare, for normal photocopying charges, for faxes, for overnight hotel stays at the Waldorf-Astoria, etc.? Many such expenses are considered part of a firm's normal overhead; many such expenses can be lowered by conducting oneself in the "normal course of business," such as charging for coach airfare (not first class or business fare), hotel charges (at a Marriott, etc. rather than the Waldorf).

Any "over" charges should be at the lawyer's expense not the expense of the estate. After all, isn't that why the lawyer is receiving the larger per hour fees? It's when the lawyer begins to "nickel and dime" the client or take advantage by charging more than "ordinary" expenses, the perception of over-billing extends over to the fee itself. When asked, I usually advise my clients to reduce the expense charges and their fee charges will not be questioned.  It's usually the $5.05 charge that brings the whole bill into question, not the other way around.

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Most of us can notice when something “isn’t right” with our bodies, and we often are quick to jump to a conclusion about the cause.  Yet what we perceive to be the problem, and the reality behind it, may be much different.

A urologist recently shared an example with me, saying that many people come to him to “fix the problem” of an over-active bladder at night.  They typically attribute it to a “plumbing” issue that a pill or even surgery can cure.  Yet this doctor suggested that, as people age, they sleep less and they’re likely to be awakened more easily by sounds that didn’t disturb them in earlier years – a dog barking, the house creaking.  Once they’re awake, they decide to honor the bladder urge so they can go back to sleep. The perception is that there is a physical medical problem.  The real cause is the natural aging process and the best “cure” is to accept it.

Transfer this lesson to a law practice.  Most lawyers are quick to perceive a problem when there is less money coming in the door.  They immediately jump to a conclusion about “the cure” – do more marketing, or raise rates.  The reality is that declining revenue typically began long before as a problem with receivables.  Generating new work to cover declining revenue simply isn’t the answer.  The strategy is to make sure clients know they must pay their bills within 30 days.  And the way to do that is specify clear collection terms in the engagement agreement. Lawyers perceive every client as valuable and hate to cut them loose; the reality is that continuing to do work for overdue clients who don’t pay shows those clients are not worth keeping.

A new study by George Washington Law School showed that realization rates (the amount of money billed that is collected) average 83.6 percent for all law firms, a figure that is a historic low.  If you perceive your revenue is down, and the reality is that you only collect 80 cents on the dollar, you’re like the urologist’s patients – you won’t get many good nights of sleep.

 

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Virtual veterinarian faces a legal test in Texas. He moved his practice online and talked to distressed pet owners by email and telephone. He charged a flat fee, generally, and recommended treatment options. The Texas State Board of Veterinary Medical Examiners suspended his license for violating the state law that prevents veterinarians from setting up a medical relationship solely by telephone or electronic means.

The AVMA claims that it is protecting the public's interest. The vet claims that the regulation is intended to protect the brick-and-mortar veterinarian practices.

Does this sound familiar? Every Bar regulation that I've ever reviewed (or testified against) has been sustained on the basis of protecting the public. Where are the interests of the membership, the very professionals who pay dues to keep staff employed? These interests seem to be relegated to the back of the bus, if not ignored completely. In the legal community, this "ship" has sailed. I don't think anyone would claim that a "virtual" law practice is illegal. It will be interesting to see how the Texas court rules in this matter.

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In a recent case, the 7th Circuit appellate court said that the law firm failed to comply with its contractual notice requirement to the carrier. The law firm was required, as is true in most such contracts, to notify the carrier of a possible claim of negligence. The law firm said that notifying the carrier of every possible claim would delve it into minutiae and was unreasonable. The Court said the facts of this case suggest that any reasonable attorney should have known that a claim was likely ... and therefore the firm owed a duty to the carrier to notify the carrier.

If you take the time and expend the funds to purchase insurance, you must review your contractual obligations of notice ... otherwise you're wasting your money and leaving yourself exposed to massive claims.

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Customer service is appreciated whenever it occurs. 

My wife and I (and I dare not forget Bandit) are spending a few days in 
Tucson, AZ at the Lazydays RV  Park. 
Gathered with us are close to 100 other Airstream rigs, from trailers, 
to motorhomes ... from new to vintage as is ours. 
The amenities are outstanding and, as usual, it is the people that make 
an experience memorable. 
They go out of their way to be friendly and accommodating. Their brochure 
says that all their employees take weekly service instruction. 

Can you identify a law firm that has done that?

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In a recent USA Today article, texting and music listening while driving and walking are leading to an increase in the death of pedestrians. People are still talking on the phone and texting while driving, despite the statistics that prove it can be deadly and despite it being against the law.

But now, we have new statistics that show the same result -- injury and death -- arises from just walking and texting or listening to music and being in "another zone."  All of which confirms that multi-tasking is a misnomer. We can do one thing at a time, not many different things at the same time.

Those who reach the pinnacle of success are able to do many things ... but focus on one thing at a time. There just ain't no such thing as multi-tasking.

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At the end of the day, the value of our law practice is based on our success and the many people we have touched over the years. This is a significant legacy we will leave on retiring from the practice. 

Most lawyers all around the country with whom I've spoken don't understand this and can't comprehend even the possibility that their many years of effort may actually have produced a monetizeable value of some significance. This value can enhance their retirement. It is a challenge to overcome such deep-seeded beliefs among many Baby-Boomers as they get ready to move on to their second season. This is the difference between personal goodwill and organizational goodwill. There is more of the latter than most people believe.

My conversations have convinced me that the most feared word in the English language is “retirement.” That may contribute to the refusal to consider an alternative to closing the office; we will maintain our office and work until our last breath. It is possible, however, to do both! The sale or merger of your law practice, rather than the closing of the office, should be an alternative that is kept open for your consideration.

 

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I’ve talked about a lawyer having an estate plan. I’ve talked about creating an estate plan for your law practice; this is an idea first generated by Ellen Peck, retired judge of the California State Bar Trial Court. Now, there is another estate plan to prepare: Digital.

What are you going to do with all your passwords, all your email accounts, all your accounts in social media and all your other accounts that reside in the internet?   

Your virtual life doesn’t end just because you die. And in some arenas, the material you have on the internet cannot be removed or taken down. You may even have money residing in some of the internet residences such as PayPal, on-line gambling accounts, etc. Be sure to appoint or designate someone to be responsible for dealing with these issues. Be sure to write down all the accounts and passwords. And be sure to contact such companies as LinkedIn, Facebook, Google, etc. to comply with their policies.       

There is little or no case law to date about planning for digital assets after death, and certainly no precedent of which I’m aware on this. But, for just that reason, it’s time to think about these issues.

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Electronic and computer technology enable lawyers to do more and better work in less time, but this creates a new service dynamic where clients continually demand to pay less for what they increasingly see as a commoditized service.

Law firms must meet client needs through greater technology efficiencies. Not only does this seem obvious, it is an element necessary to maintain competence as required by the rules of professional conduct.

More efficient law firms that reduce client legal costs should gain new business that enhances revenue.  However, the ability to increase billings while becoming more efficient depends on changing the billing system to embrace alternative fee arrangements.  With greater reliance on contingent, fixed, capped or value fees where time is not the relevant issue to determine the fee; service to the client is the key metric of value to the client, not billable hours.  

 

 

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Are you billing appropriately? This week, Ed will offer handy tips that will help you collect what you billed to make sure that you're getting paid.
 

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Getting paid by the hour stresses us, according to Frank Partnoy. He says that "(i)nnovation doesn't occur in a year or a quarter---and certainly not an hour. So why measure work in too-brief increments?"

This is a novel rationale for moving toward the fixed or flat fee billing concept and away from hourly billing. During the 25 years of my law practice, I remember how stressed I was, always seeking to make sure that I had accounted for my time ... and correctly billing my clients. During the last 23 years of coaching and consulting .... and only flat/fixed fee billing, I'm focused on my clients' condition and how I can improve it, not on how much time it takes me to do so. As Partnoy says, "Clocks and calendars are not going to change -- so it is up to us to try to get off the clock, especially when we find ourselves watching it." (See Parnoy's "Wait: The Art and Science of Delay.")

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In the Wall Street Journal, staff writer, Jacqueline Palank discusses the Justice Department’s attempt to control fees that bankruptcy lawyers seek. Creditors and employees may, at times, be a bit disgruntled by such fees. So, now, the U.S. Trustee Program appears to be entering the fray.

Before going further, it should be noted that i) any fee sought by an attorney must first be approved by the client going into bankruptcy; ii) the fee cannot be paid before a Bankruptcy Court Judge approves the fee request; iii) the legal fees most often are a pittance compared to the debts of the company and thus have little or no impact on either the creditors or the employees. In fact, the current proposal is limited to companies whose assets and debts exceed $50 million, hardly your "normal" bankruptcy.

The only reason for focusing on the legal fees is that this is a topic that makes good reading in the tabloids, including the WSJ. While the quoted hourly rate received by some attorneys seems high, it is insignificant in comparison to the compensation received by incompetent CEOs and others in the C-suite offices. Why don’t the tabloids focus on the cause of the bankruptcy? Why not focus on the compensation of the management team, which often is at astronomically higher multiples compared the lowest paid employees of the company? Why not seek redress against the management that is responsible for bringing the company to its knees? Although this focus may have more positive economic impact, it clearly is not sexy enough to sell many papers.

The U.S. Trustee is proposing, according to the writer, several new approaches to control lawyers’ fees, including:

•    Though the lawyer applicant must disclose his/her hourly rate now, the Justice Department wants the lawyer to disclose the lowest, highest and average hourly rates the law firm charges in all its matters.

•    The Department wants the lawyer applicant to create and disclose to the Court a budget for legal expenses. This budget would, necessarily, disclose to all involved, including the creditors who are adversaries of the bankrupt, the client’s planned legal strategy.

In the 1960s, the Supreme Court ruled that it was anti-competitive for bar associations to maintain a listing of suggested fees for different types of work. Such a listing, in particular, helped younger and newer lawyers set their fees at rates that were more in line with more senior lawyers. Not having such a list would compel lawyers to set their own fees, the theory being that lawyers would then be more competitive with one another to the consumers’ benefit.  The Trustee by its first proposal ignores this. The existing disclosure already provides information that tends to be anti-competitive. Law firms can see what others are charging and price their own services accordingly, causing rates to slowly increase in lockstep over the years.

Intruding into the fees charged for practice areas, such as general business matters, estate planning, tax work, and other areas of work performed by the firms who also do bankruptcy work has no bearing on the special expertise of large company bankruptcy lawyers. No area of law other than bankruptcy requires such disclosure for court approval. Fees are left to be negotiated between attorney and client. Other than precedent, there is no reason disclosure should be made here either and the process should not be extended. “Transparency” is a bogus issue. There is no backroom conspiracy on how bankruptcy fees are charged. All the proceedings are public and must be approved by the Court before attorneys are paid anything.

Budgets are good. I recommend them to my attorney-clients with whom I consult. Budgeting is a process, however, between the client and the attorney. By requiring that bankruptcy budgets, which reveal legal strategy, be made public, the U.S. Trustee is saying that bankrupt companies have no rights. They have no right to advocacy; they have no right to develop a strategy that might affect creditors' claims; and they have no right of confidentiality. This is clearly contrary to the U.S. Constitution and our entire judicial system. While the bankrupts, and their inept management, may have proceeded down an economically unwise path, they still have rights to seek the best windup of affairs in their economic environment.

Don’t worry about the lawyers’ hourly rates once the bankruptcy petition is filed. They are regulated first, by the client, and second, by the Court. Who is watching the compensation of the management team before the company entered bankruptcy? Why are inept executives not punished with fines, or worse, for malfeasance and negligent management tactics? Why are they allowed to benefit so expansively at the expense of their workers? Why don’t the tabloids focus their sharp light there? Oh, I forgot, the tabloids need to sell papers, they are part of the industrial complex that both Presidents Washington and Eisenhower warned us about as they left office.  Perhaps the fact that quite a few newspapers and newspaper chains (Tribune Co. and papers in Detroit, Denver, Minneapolis, Philadelphia and many other cities) have been mismanaged and had to file for bankruptcy has something to do with it, too.

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Have you committed negligence in representing a current client? Do you suspect you may have committed negligence in a current matter? Don't talk about your mistakes with other lawyers in your firm! According to Richard Zitrin in his recent article in The Recorder, the courts have held that such internal discussions, even if used as a teaching device to make sure the mistake isn't repeated, can be discovered in a malpractice case.  Only if you hire outside counsel and talk with such counsel are such discussions privileged. According to Zitrin, the client is owed the duty of competence as well as the duty of candid communications. These multiple duties trump whatever duty the lawyer may assert.

There is something wrong when you are not allowed to talk with other members of your own firm either to explore if something really was negligent, or how to deal with it for the betterment of all concerned and clearly how to make sure it doesn't happen again in the future. I suspect that talking internally about the best way to talk with your client about the actions taken or not taken would also not be privileged. This conclusion, at least to me, is counter-intuitive.

While the rule seems to be clear in California, the rule is not so clear elsewhere. It can only be hoped that as this issue receives more light, there will be obvious exceptions for issues as I've noted above.

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In the Opinion section of today's Wall Street Journal, two fellows from the Brookings Institute espouse their philosophy for deregulating the legal profession:  Let anyone practice law; whether they've gone through law school or not, and allow anyone to own a law firm.

These are not new ideas, but the assertion that these ideas are the key to lowering costs of delivery of legal services is misplaced.

First, the licensing of lawyers is to protect the public; they are not there to protect the interests of lawyers. For example, an individual must be competent to represent and advocate for the interests of a client.  It’s the same principle as licensing doctors.  Incompetence either in court or in the operating room can cost people their lives.

Second, technology provides many avenues to reduce legal costs. Removing the licensing requirements has no impact on this issue. Yes, requiring a license does cost money and does cost time (opportunity costs for the student), but it also impacts the quality of services delivered ... just as in the case of medicine (oh yes, and plumbing), etc. Why not remove licensing requirements for everyone in everything, from medicine, to plumbing, to driving a car. Licensing assures a minimum standard of quality. Licensing requirements in specific areas of human endeavor are society's way of self-protection. Caveat emptor is acceptable, but not to the degree apparently desired by the authors of the Brookings report.

If lower legal costs are the objective, the argument should focus more on the pricing modalities as they impact the cost of legal services rather than the governance of the law firm. We've talked about this on previous occasions.

Third, the underlying premise that licensing provides an insurmountable barrier to entry and substantially raises costs by controlling supply might be true if one doesn't look at the facts of recent and current reality. There are many more lawyers than the current demand can accommodate.  Many lawyers cannot find work. Thus, it is illogical to suggest that licensing is the cause for higher legal costs. Those lawyers who are working often provide legal services at lower rates than they used to charge. Even large law firms find significant resistance to raising their rates. Are legal expenses high? Yes, but compared to what? How low should these prices be before they are acceptable? And, if there is no regulation, we might likely see larger law firms pattern their pricing after one another, just as the unregulated airlines currently do, so that the benefit of lower costs would not be evident.

There is no price regulation now in the airline industry. Yet, it's remarkable how similar airline prices are. Yes, there are a few low cost airlines such as Southwest. And, yes, there are also lower cost law firms as we sit here today, even with the regulations we have in place. The only benefit of the authors' "non-licensing" proposal would be the destruction of minimum standards of quality. Caveat emptor might be acceptable if the public had a way of knowing what the quality standards should be ... but they don't and they won't.

Combining other skills such as accounting into one organization (the old "multi-discipline" argument) is not required ... many law firms already work closely with allied professionals for the benefit of clients. This is merely a non-issue.

Dewey, which went into Bankruptcy Court last night, did not fail for lack of credit. The firm had been extended bank lines of credit. It failed for lack of effective management. It's unlikely that investors or others would have given Dewey more money if they understood the true nature of the firm's economics and governance. Thus, this is also a non-issue for the authors’ arguments.

In sum, law firms function no differently from all other businesses. Good, solid business decisions must be made to attract customers/clients and operate cost-effectively. Dewey failed on both counts. The arguments put forth by the authors would not have changed this outcome. But, in the terms of business, by going into bankruptcy, the firm may be able to disgorge its unfunded pension obligations and become a viable candidate for acquisition by another large firm.  That’s when the principle of caveat emptor really comes into play – as a normal risk that businesses take every day.

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Judge Lippman, Chief Judge of the New York Appeals Court, announced a pro bono requirement to gain admission to the New York Bar. Every new lawyer will have to prove their performance of 50 hours of pro bono practice before being admitted to the New York state bar. Mandatory pro bono is now a reality in New York.

He said, "If pro bono is a core value of our profession, and it is—and if we aspire for all practicing attorneys to devote a meaningful portion of their time to public service, and they should—these ideals ought to be instilled from the start, when one first aspires to be a member of the profession."

His first error of judgement, in my opinion, is to conclude that pro bono is a "core value" of the legal profession. While many lawyers "give" many hours freely of their time and expertise, it is not the essence or "core value" of the legal profession. This has been substantiated many times over when bar associations call on their members to provide free services for low and moderate income people. Many do step up to the plate. But, not all. Thus, it's obviously not a core value of the profession.

He then said that "We think that if you want that privilege, that honor of practicing law in the state of New York...then you are going to have to demonstrate that you believe in our values." He is really saying that if you want to practice law in NY, you better meet my values. Interesting that he says that practicing law is a privilege, not a right. Seems as though we're taking a test to get our driving license. Driving a car is a privilege and in order to get you on the streets, you need certain requirements. I guess Judge Lippman equates getting a law license with a driver's license.

Why does this new requirement apply only to new lawyers? Why doesn't this requirement apply to all lawyers in NY, even those who have been practicing for a few years? Judge Lippman's excuse for this discriminatory practice is that existing lawyers' practices are very diverse and some lawyers already are having difficulty earning enough money to put food on the table. Thus, they should be excused from this requirement. The real reason is that the Judge would have a rebellion on his hands if he tried to spread the requirement to all present lawyers in the state.

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In a recent issue of a major legal publication, as reported by the American Bar Association, the magazine looked at pension plans of law firms. It appears that a number of the country’s largest law firms have pension plans that are unfunded. In other words, these are firms with pension plans, but without money to pay the obligations of those pension plans as their lawyers retire. What we will increasingly see are law firms with the bulk of their lawyers leaving the practice for retirement with the hope and prayer that the fewer remaining, younger partners will be willing to fund the firms' obligations. We will also see many situations where these younger lawyers will find it to their economic advantage to torpedo the existing law firm and its pension obligations in exchange for creating a new firm with no pension obligations. Doing so will give them the opportunity to take on more of the revenue that is produced by their efforts. They will earn more and pay less.

This phenomenon will exacerbate the generation warfare that is building in today's law firms.

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Once again, it is confirmed that law practice is a business. As I've been saying since I received the registered mark for The Business of Law®,  law practice is a business. Yes, it's a profession AND also a business, a service business.  Dewey & LeBoeuf confirms this. 

This large, national law firm has just retained outside bankruptcy counsel. Why? To consider whether they can create a controlled bankruptcy ... filing a bankruptcy application with creditors and potential acquirer already in place. The beauty of such a filing is that it will i) stop the bleeding of lawyers leaving the firm a few at a time, ii) eliminate the unfunded pensions that would be a drain on the firm assets and future revenue, and iii) enable another firm to complete an outstanding acquisition quickly with a clean balance sheet and revenue stream intact.  A side benefit of eliminating the unfunded pension obligations would be to avoid generation warfare that frequently arises between retiring partners and younger partners left with the responsibility of using current revenue to pay for the old debt.

This process is precisely the same process used by so many other companies, including some of the large companies in the recent financial crises that survived, but in different configurations. This is the same process as the airlines are implementing today ... to reduce their obligations to labor. This is the same process being contemplated by a number of prominent government entities (cities and counties) to get rid of their unfunded pension obligations that are expected to require more than 60% of their current tax revenues.

So what is different about Dewey? Nothing. We are in the world of business, The Business of Law®.

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The Law Practice Management Institute raised a number of issues and produced great discussion among the attendees.  Some of the issues in the first day were:

• Creating a marketing plan is important for success
• Alternative fee structures and billing modalities opened possibilities not previously considered
• Sending a satisfaction survey to clients helps maintain and build the relationship as well as provide a defense against malpractice and disciplinary complaints
• Guaranteeing satisfaction with the service of the law firm will reduce the hesitancy of many clients to engage your firm
• The statistics of why clients leave their present firm and why they refer their present firm to their friends and colleagues was an eye-opener.
• Always put yourself in the shoes of the client and seek to understand, and avoid, what makes the client unsure and/or angry about your service.

 

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An interesting question was raised recently in the discussion about alternative fees. What happens in either of two scenarios:  i) When the client terminates the relationship before the legal services are concluded and ii) When the fee is challenged in a dispute between attorney and client.

In the former case, how do you apportion work already done versus work yet to be done, especially when the fee agreement is silent on the subject? This question is set against the backdrop that a lawyer refund any advance payment of fee that has not yet been earned. And, though a fixed fee, the fee must be placed into the client trust account until earned. Does one have to refer back to the time spent (hourly billing)? And if the subject is covered in the fee agreement, are we building into the relationship all kinds of negative vibes between attorney and client?

And, though fixed fees/alternative fees are designed to reduce conflict between attorney and client, should a dispute arise, how do we test the reasonableness of the fee?  Again, usually by reference to the hourly billing rate and time spent.

This subject once again points to the need for good client relations and effective, frequent communication between attorney and client to make sure such disputes don't arise and/or are settled quickly.

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From time to time, we have guests on our blog.

This week, Erik M. Pelton with Erik M. Pelton & Associates, PLLC is our guest blogger.

Excellent management of calendars and deadlines is critical for all attorneys. Big firms can afford dedicated staff and/or software for these matters, but small or solo law firms must properly and efficiently manage firm calendar and deadlines without such luxuries.

A law firm “docket” consists of calendar items such as meeting schedules, court deadlines, discovery deadlines, client obligations, marketing schedules, hearing dates, and more, for each of the members of the firm. Timely tracking of these matters is critical to increasing the chances for successful outcomes of matters. The key to successful docket management is to develop procedures, routines, checks, and backups so that the docket takes care of itself.

Here are some tips for setting up a docketing system:

-       Find what works. There is no magic solution and there are many ways to reach the same goals. Be creative and experiment with different possibilities.

-       See the big picture. Use a physical master calendar centrally located in the office. For example, I have a wall filled with four large calendars for the current month and the next three months (see photo below). Deadlines, travel, planned absences, meetings, and more are all labeled on this central calendar. I use dry erase so it can easily be changed, and it is color coded for different types of items. The calendars hang so that they can easily be rotated and updated as one month ends and a new month begins.

-       A system for intake and inputting new docket items is key. When a new matter or item with a deadline comes in or is created, do not hesitate. Docket it immediately before any chance to forget is created. For example: when I receive discovery requests in a case, I docket the deadlines for when the responses are due before I even read the requests. I set a reminder of the deadline in Outlook as well.

-       Err on the side of caution. I docket even potential deadlines and items. If I have to cross them out or erase them, it becomes one less thing to do. Proactively docketing saves having to scramble at the last minute if a “maybe” becomes a “yes.” (Example: a tentative deposition date in a case that might be settled first.)

-       Document the office docket procedures and make sure everyone understands how to use and access them.

-       Mistakes inevitably will happen when a new system is set up. Learn from them, and tweak the system to make sure that type of mistake will not happen again in the future.

-       Have a backup. Even better, have two! (Example: I have a software-based docket, with backups in Outlook and on the dry erase boards.)

A solid docket with a backup does more than help you work efficiently and manage your time – it may reduce potential liability for malpractice and can also reduce malpractice insurance rates.

Managing a docket can certainly be stressful. The time and money invested into a great docket that works for your particular situation will not only serve clients and attorneys well, it will reduce an enormous source of stress and worry.

© 2012 Erik M. Pelton. All Rights Reserved.

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One would think that lawyers could keep their eye on the ball. But, somehow, despite the importance of cash and cash flow to the very survival of the law firm, lawyers tend to focus their attention elsewhere. I find this to be true not only in the small firm, but also in some of our larger brethren as well.

Recently, I was asked to consult about "missing cash." The bottom line is that it's easy, for even a longtime and trusted staff person, to lose his or her moral compass ... when money is readily available ... and not regularly monitored! Establish policies for handling cash and for paying bills, the two easiest areas of manipulation by one so inclined. Be persistent in the application of these policies. Ask for an external review of these policies periodically ... and their application. Insist that there be no shortcuts in handling the finances of the firm.

Nothing less than the firm's reputation and standing is at stake! ... And the lawyer's license to practice law.

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From time to time, we have guests on our blog.

This week, Erik M. Pelton with Erik M. Pelton & Associates, PLLC is our guest blogger.

Unless you are truly a solo practitioner, you will experience hiring and managing a staff (even a ‘virtual assistant’) at some point. In fact, unless you are super-efficient or already established, some form of staff is likely necessary to manage a growing firm and the marketing needs. For example, in my 12 years of practice (starting and managing a small firm), I have hired and supervised numerous associate attorneys, paralegals, and interns, as well as a variety of subcontractors.

Hiring and managing is no easy task – especially when you have no relevant training or experience. Law school gives most of us the experience of being interviewed, not interviewing others; of writing resumes, not reviewing them; of taking instructions, not giving them.

Use the following keys for making successful hires in a law firm, and you should fare well:

-       Personality and character are at least as important as experience and skills. Skills can be taught, but bad character or clashing personalities cannot be overcome.

-       Reward staff that are trusted and hard working. When financial raises or bonuses are not available, provide additional vacation time. While this represents and increase in expenses, the financial and other costs (time, risk, productivity) of replacing someone good who leaves for another job and training a new hire are generally far greater.

-       Let employees develop their own “brand.” Encourage them to participate in associations, chambers of commerce, or other activities that are good for the firm and good for their professional development.

-       Provide occasional non-work opportunities to socialize with employees and their families and significant others. Take them out to dinner, sporting events, or the like.

-       Lead by example. Actions speak louder than words. These clichés are generally true and can have a big impact. If you expect your staff to do something in a certain manner or act a certain way, you must lead by example.

-       Don’t micro-manage. Delegate and provide support to your staff, but allow staff the room to grow and to figure things out on their own.

-       Provide periodic reviews. Offer constructive criticism and positive reinforcement. Provide a steady stream of feedback to your staff and encourage them to provide the same to you.

-       When staff members do not work out, cut your losses and move on. Letting someone go is difficult, uncomfortable, and creates short-term stress and additional work. However, it is worth it. Bad situations only become worse over time, and the lost time and stress produced by bad or unproductive relationships can never be replaced.

The only way to get experience in a position of authority is to do it! Hiring and supervising can be great fun and lead to great successes by training and mentoring staff persons that blossom.

© 2012 Erik M. Pelton. All Rights Reserved.

 

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More elderly find they cannot afford to retire ... they must continue to work. The recent economic woes have taken a big bite out of the retirement hopes and plans of the Baby Boomers. And this includes lawyers.

Just today, a lawyer in his late 60's called me to talk about selling his practice and retiring. But, he said, he enjoys what he does and financially cannot see his way to retiring. For interesting tax reasons, he turned away from selling his practice. Of course, he didn't consult me before he made this decision.

But, I find it interesting that the prediction made by the ABA only a few years ago that by 2020 (or perhaps sooner), 400,000 lawyers would retire. As evidenced by the phone conversation today, I believe the numbers are correct, but the timing is not. Succession planning, whether a solo or large firm practitioner, will require more thought than we anticipated. And experts should be consulted to determine sales potential, tax planning (both estate and consequences of a sale) and future personal life planning.

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How do we get from here to there? Jim Collins, in his Good to Great, describes CEOs with many different styles, but all successfully leading their companies to the pinnacles of success. How do we do that for ourselves? Is wanting something enough? Is the intention to be great, to be successful, to be rich enough? Is imagining or visualizing the "there" enough?

I suspect not. First, we must identify where we are. Then we must honestly address what our current state or condition is. And finally, we must develop new approaches to deal with the troubling challenges we face. As Dr. Phil might say, in the popular vernacular, "How's this working for you?" And if what you're doing now isn't working for you, you've got to change your pattern, your actions ... and not merely wanting the change. You've first got to think it through and, then as my coach, Alan Weiss, might say, develop the "Resolve" to change.

Are you in a good employment situation, do you have a good law firm partnership, do you have the kind and number of clients you want? If not, what are you going to do to make the change you want? One approach might be to engage a coach to provide you with meaningful feedback.

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Jane's comments about holiday cards vs email cards is are worth noting. It is a tough time of year for many with cards and gifts decisions to make ... But, as my mother used to say, "... if you don't remember me364 days of the year, forget me on my birthday!"  In other words, the one day a year remembrance doesn't do much, especially for busy people.

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From Lawyers USA, we learn that the American Bar's Ethics Commission has recommended that states rules be changed to allow non-lawyers to own up to 25% of law firms. 

Rules against lawyers sharing fees with non-lawyers might need to be loosened to allow U.S. firms to compete globally. The proposal says that any firm with non-lawyer owners must have “as its sole purpose providing legal services to clients.”

This is the foot in the door.The next thing you'll see is Latham & Watkins, or other billion dollar law firm opening offices in Wal-Mart or Target stores for curbside service. This is not necessarily a bad thing. It will certainly bring the law to the people ... And it will certainly change the perception of the law.

I've always maintained that the rules of professional conduct are controlled by the large firms, AmLaw 100 and 250.  When their economic needs change, the rules get changed and the sole and small firm practitioners have to adapt accordingly.  In other words, the rules are not made in a vacuum, not made because of their inherent righteousness or goodness. They change and are made to serve the economic interests of the few ... oh, if the public is served, so much the better.

But if you're a solo, watch out ... your interests may not matter. Such has been the case in recent times when solos' interests were not protected, in fact hurt, by changes in the rules .. But, here, to allow the larger firms to complete on a global scale, we see the rules begin to change and allow allied professions to join in the ownership of law firms, not merely as allied professionals independently serving the same client.

Economics control .. as always ... even here in the rules of professional conduct.

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Robert Denney, a well -known and very capable marketing consultant, reports in his monthly newsletter that:  "... an outsider ... joins DLA Piper as co-chair of the entire 4,200-lawyer firm.  This is probably an unprecedented move, at least in BigLaw.  Corporations frequently hire senior executives from outside the company – or even from outside their industry – but large law firms almost always elect partners to senior management positions.  In most cases this means they have little senior management experience and must climb a steep learning curve..."

Perhaps the legal profession is approaching reality in letting lawyers do what they do best, lawyering, and leave the managing to professionals. Or, at the very least, engage a professional coach who has walked in their shoes (i.e., practiced law) and also has business experience. The idea of having a business professional at your side, or at least available by phone, works in industry and is beginning to work in the legal profession for mid-size firms as well as sole and small firm practitioners.

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Fee suit exclusions seem to be the latest insurance ploy to cheat unsuspecting lawyers.

An engagement agreement is designed to be a "two way street." The lawyer promises to do certain things... address the needs (and wants?) of the client; represent the client to address the challenge being faced by the client, whether it be a lawsuit or a transactional issue. And, of course, the lawyer is representing that he/she is competent to do so.

The client, on the other hand, promises to tell the truth to the lawyer, provide information and documents relative to the matter when requested by the lawyer to do so ... and to pay the fee as billed in accordance with their arrangement.

What are the consequences of failure to honor the respective promises?  For the lawyer, it is a malpractice suit and/or a disciplinary proceeding. For the client, it's withdrawal by the lawyer (unless on the eve of trial or otherwise would prejudice the client) or a lawsuit for payment of the fee.

BUT, some insurance carriers are lining up with clients, saying that if the lawyer sues for fees, and the client cross complains or counter sues for negligence or files a disciplinary complaint with the state bar, the carrier will not provide defense costs or pay any judgment against the lawyer. The effect of this is to deny the lawyer the ability to collect the fee when the client fails to pay.  Why pay insurance premiums for something you will not receive?  The $64 question.

Fee suit exclusions are a veiled attempt by insurance companies to raise premiums without notice to the lawyer. And, the lawyer generally isn't even aware of this exclusion.

Both law schools and insurance companies conspire to keep lawyers ignorant of the business nature of their practice. In no other industry do creditors ignore their rights and fail to sue debtors for refusal to pay legitimate debts resulting from their purchases. Why should lawyers be placed in a different position? Why should clients be encouraged not to pay their lawyers' fees?

The reality is, according to people I've spoken with in the industry, that there are few lawsuits filed by lawyers. (Perhaps it's because lawyers have been scared away.) Further, the reality is that there are few counter suits for negligence. The further reality is that lawyers win most of these lawsuits; the figure I've been given is winning 9 out 10.

Seems that the lawyers face a big challenge:  Failure of the law schools to teach business practices so lawyers can more effectively represent clients and efficiently deliver legal services; insurance carriers looking out for themselves, not their customers (lawyers); and bar associations believing their sole function is to protect the public, rather than a dual function of protecting the public AND helping their members (lawyers) to become better practitioners (including business skills).

Lawyers who survive in this environment should be commended.

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On one evening of the year, we can be legitimately scared. But, don't run your practice out of fear the rest of the year. Know the financial metrics for your success and how to achieve it by improving the condition of your clients.

The Haunted House:

 

 

Continue Reading...

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A recent announcement touted the merger of two relatively large firms to make one larger firm of almost 800 lawyers. Why? One doesn't know the real reason, the personal agenda of the moving players. But one can look at the outside and prognosticate the likely success of the merger. What are the characteristics that will help achieve success?

First, and foremost, is the culture. Do the firms think and act in a similar fashion? This is perhaps the most difficult characteristic to address because it's subjective. And, in truth, sometimes different cultures can be blended, resulting in "new blood" being inserted into both firms creating a new, and revitalized "third" firm. But, a clear and conscious effort must be asserted. "Integration" is an overused word, but under-utilized activity in the merger field ... without which there will be a collapse of the new entity. As said, it's imperative that the leaders of both firms come together with an integration plan that is implemented with care and diligence.

Other factors can be more objective. Factors such as the differential in compensation levels and methodology, profitability and target clients are important when analyzing two firms. Another factor to consider is whether the rationale is to expand the services offered to existing clients or to enhance and make more effective existing services. Is this a sale of one firm to another? (Lawyers never speak in this language, so one must look at the economics to answer the question.) Or, is this really an amalgamation of two equal or nearly equal groups? The answer will determine the approach to be taken in putting the two together.

Mergers of larger service organizations are never easy ... Ego always is a significant factor ... and great effort is required.

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If you haven’t already, I suggest reading “Personal Best” by Atul Gawande on newyorker.com. Dr. Gawande examines the need for and nature of coaching for professionals of all walks of life.

Musicians and singers, he points out, think of their coaches as “outside eyes and ears”. They hear and see things that even the best performers can’t detect about their own performances. In endurance coaching, anyone can design hard workouts. Anyone can make you tired and push you into the darkness. In coaching lawyers, anyone can tell you what to do even if it is beyond your comfort zone.

But a good coach will help you understand where you want to go, devise a plan that is within your comfort zone and that will get you there, and then be your mentor and accountability partner to assure your success.

Who is your coach? Is it your colleague, your spouse or significant other or a professional whose career is devoted to helping others like you to succeed? Whomever it may be, we all succeed sooner and stay on top longer when we have a coach, our "outside eyes and ears."

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Yesterday, one of the attendees at the Kansas City Metropolitan Bar Association suggested that increased competition was the largest challenge facing lawyers. He said that more lawyers are using television as a major promotional venue ... and it's very difficult to compete against. These are not just the lawyers on late night, early morning spot ads. But, rather, lawyers throughout the day and in a variety of practice areas.

Television advertising is an important marketing tool for many lawyers. It has become more important for some, despite the increasing importance of the internet. 

One way to address these competitors is to focus on existing clients.  Bond with existing clients, serve them in ways that creates loyalty, and have these very same clients be your advocates with others.

In such a case, you don't need television. You won't have competitors! You will be in your own bubble, growing your revenue and growing your profitability with clients who continue to return and who refer others to you.

 

 

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One of my clients recently asked me why we all do what we know is not good for us, in fact, hurts us? If you’ve got a choice between option A that is good for us an d option B that is not good for us, why do we oftentimes select option B? To be specific, why do we procrastinate? Why do we fail to enforce our own engagement agreements? Why do we continue to work for clients who do not pay our billings? And we could go on …

In this specific instance, my client complains about his partners and associates not collecting billings for work performed. There may be several possibilities to answer the “why.” One is that, despite being in an adversarial profession, most of us dislike being confrontational, especially with our own clients. Second, lawyers like doing what they love to do … and collecting (or any business related matter) is not what they love to do. And third, they don’t perceive this as their business.

There may be a number of solutions that will get their attention. First, you sign the paycheck. That carries a lot of weight if you care to wield the “stick.” Two, engage a staff person to be the collections manager for the firm; don’t ask lawyers to do that which they’re both not qualified to do and which takes them away from doing what they do best. Third, read my book, Collecting Your Fee: Getting Paid from Intake to Invoice, and follow the scenario and script outlined to interact with slow-paying clients.

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Should a lawyer-employer lend or give money to an employee to improve her skills, to become a paralegal, when there is some concern that she may not remain with the firm more than 2 years more?

This is a question that is posed more often than we realize. How would you respond?

In my experience, the answer is determined by the contribution the employee makes to the firm. However, if there is concern about whether the employee will remain with the firm, my inclination would be to hesitate.

Continuing education,not only for lawyers, but also for staff is essential for improving skills and effective representation of clients. And we should do anything we can do to encourage staff improvement.

 

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More than 23% of the Washington State Bar Association, a mandatory bar, are 60 years or older. Several years ago, the American Bar Association, a voluntary bar, estimated that 400,000 lawyers would retire in the next 10 years.  For the ABA, that’s equal to its entire membership. And that's equal to about 40% of all lawyers and a majority of private practitioners.

Continue Reading...

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Outsourcing jobs typically pay better than temp work — and certainly better than no work at all. This is the message of a recent article. The legal profession is developing its own caste system. We all understand some of the differences, or castes:

• Big Law vs. Small Law
• Sole practitioner vs. Large firm lawyer
• Specialist vs. Generalist
• Boutique vs. Full product line
• Domestic vs. Outsource (overseas as in India and Philippines)

And I’m sure there are other distinctions that I've overlooked. But, now there is another phenomenon appearing. ....

Continue Reading...

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Despite today's economy, some law firms are growing ... by merger and acquisition.

In fact, I had lunch with such a law firm just this last week. They are an 100 lawyers firm that is seeking to grow. They are interested in acquiring my client, a substantial boutique that would add a significant presence for them both in the relevant practice area as well as the geographic area.

We couldn't seem to connect, however. I made it very clear that my client was talking about selling his firm. Their offer suggested that they were interested in "merging." The reason was simple: No capital outlay was needed for a merger. The "offer" was structured in a way that would pay my client several hundred thousand dollars more than he is currently earning. And 100% of the payment to my client would be tax deductible as an ordinary expense, not a capital expenditure. They structured the offer this way also in order to be sure that the "book of business" follows my client for several years. This, was not what we wanted ... we are not looking to become partners in the acquiring firm.

During our conversation, it became clear why we were communicating at different levels...

Continue Reading...

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Even marketing folks are concerned about the return on the investment in one's daily activities. While some folks, yes, lawyers too, ignore the money, marketing professionals are trying to convince their management that they are important to the success of their organization, that they are responsible for a lot of new business.

AdAge says: "...Return on advertising investment has always been a priority for marketers, but in the recession it flew to the top of the list. As chief marketing officers fought to justify spending within their organizations -- often via spirited discussions with procurement departments about where the dollars are going... " The Days, the subject matter of this article, I'm pleased to say are friends ... and outstanding marketers who focus on providing a profit on marketing dollars spent.

Do you look at this issue? Can you determine whether the money you spend is producing a profit, is enabling you to expand in your practice area, is improving your skill as a lawyer, or otherwise contributing to the improvement of your law practice?  You should. If not, you're in the gardening, playing with the dirt rather than growing gorgeous roses for sale to others who can appreciate your skills.

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"The NLJ 250 collectively employed 9,567 fewer lawyers in 2010 than it did in 2008, a decline of nearly 8 percent in headcount, with the 10 largest firms in the U.S. alone losing more than 1,000 lawyers last year. This is just the second time in the 34-year history of the NLJ 250 survey that the nation’s largest law firms have experienced a net reduction in employed lawyers for two consecutive years."

This group of law firms, the largest of which is Baker & McKenzie at 3,700+ lawyers, makes up less than 5% of the attorney population. Their growth, like all corporate growth, has its expansion and contraction phases. There are at least two questions that come to mind:

1.  Is this contraction permanent? Is this contraction a reflection of the entire industry?

2.  Does this contraction reflect a major shift in the way legal services will be delivered in the future?

My crystal ball does not give me the answers. But, I believe that

i) even sole and small firm practitioners felt the change;

ii) though the numbers in the survey reflect 2008 as the base year, there does seem to be a cautiously upbeat attitude among lawyers today. More lawyers are contacting me with the serious questions of how do we make our practice better, how do we grow our practice ... in other words, lawyers are starting to come out from their caves, a bit shell shocked, but ready to understand the needs of clients and focus on providing solutions to their clients;

iii) it's not the contraction that will cause the shift in the way services are delivered, it's the continuing evolution of technology that will impact the delivery of services. And this conclusion would have been the same with or without the contraction. It's just that, because of the contraction, we're more sensitive to the changes. But, these changes began before 2007-2008, and they will continue after 2011.

Lawyers have to be more sensitive to technological changes and how these changes can improve their efficiency and mode of delivery. Clients certainly are and they are looking for those lawyers who can reduce their legal costs (not necessarily hourly rate). Thus, even the decades-old billing and pricing models will be subject to pressures that mere conversation failed to impact until now.

As Oprah said yesterday while interviewing the President and First Lady, "... keep your eyes on the prize."  Know what you want in your practice. Know what your clients want from you ... what is the ultimate solution they are seeking by engaging your services? Stay focused and you will have happy clients ... happy clients pay their bills ... happy clients refer their colleagues and friends ... While doing good, you will be able to do well.

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McKinsey & Co. released a report stating that 'inadequate career development has kept women from reaching the top rungs of the corporate ladder..." The same is true in law firms who correspondingly have low numbers in top management.

The report said "...companies need to spend more time coaching women ..."  Corporate America understands this; when lawyers learn to understand this, they will become better lawyers.

The coaching process works for athletes, works for top executives in Corporate America; and works for others who want to increase their revenue and decrease their stress. A side benefit of great importance an increase in one's self-esteem. Lack thereof is one of the greatest impediments faced by most professionals, probably because our standard is "perfection." I know no one who is able to reach that standard. Coaching can show us how important "progress" is without worrying about reaching an impossible level of perfection. Having someone walk the plank with you who understands these issues and can enable you to progress is important. As with an athlete, having a coach can be the difference between a very successful practice and a modest practice. 

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In today's L.A. Times, a doctor  talks about her reaction to meeting a patient in an airport restroom. The patient was out of context and the doctor was taken aback, at first not recognizing the patient. She concludes by suggesting how much she learned about the patient by seeing her in her own environment, the place where she works. As a consequence, she starts to think about how her future treatment of this patient will be altered.

How often do we, as lawyers, see our clients in their habitat? What kinds of information might we gather, mostly unspoken information, that would dramatically alter the advice we provide? In many cases, quite a bit! Yet, not many lawyers take the time, unbillable time, to visit our clients to really get to know more about them, their work and family environments, and the possible impact on the clients of the advice we provide.

Like the doctor writing the article, I suspect our approach would be somewhat different. And, perhaps more important, the connection the client has with us would be dramatically different!  That bond, needless to say, would result in better representation and more referrals. Interested?

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I recently wrote in my LawBiz Tips Ezine about how law schools continue to churn out new graduates even as demand for them drops, and cited a New York Times article on this issue that concluded:  “Today, American law schools are like factories that no force has the power to slow down – not even the timeless dictates of supply and demand.”

Now it appears that the law of supply and demand has not been repealed after all.  The Wall Street Journal reports numbers from the Law School Admissions Council showing that the number of law-school applicants this year is down 11.5% from a year ago to 66,876. The figure, which is a tally of applications for the fall 2011 class, is the lowest since 2001 at this stage of the process, which is almost 90% completed.  

The reasons aren’t hard to understand.  Firms increasingly prefer to hire lateral attorneys who have already had on-the-job training and books of business, rather than new graduates who don’t understand “The Business of Law®” and will take years to begin returning a profit on the investment made in them.  And from the student side, the realization that going six figures into debt to get a J.D. degree that offers no assurance of gainful employment is not exactly a smart idea – especially for those whose main motivation to attend law school was to make the supposed “big bucks” available rather than to pursue a legal career.

So who is hurt most if the law school bubble does burst?  We can only hope it will be the law schools themselves, who continue to pour huge resources into “gaming” the law school rankings so that they can move up from number 19 to number 17 and thereby (they presume) entice more students to enroll.  When the housing bubble burst, it was – and continues to be – the financial geniuses at the banks who were left holding the bag.  Are law school administrators any smarter?

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Last week, I had an accident. A preoccupied driver who admitted she didn’t see me failed to yield the right of way and turned left before I could see her. My bicycle hit her right front fender. You can see a picture of the damage to the car.  Sometimes, it's better to hit than be hit. Because I hit her car, rather than she hitting me, I am alive and still walking, albeit with some difficulty. The fireman and paramedics said they'd never seen such damage to a car from a bike. “... Either the car was made of plastic or you are a man of steel!...”

If I were made of steel, I would not be so sore and bruised as I am still today. My thighs and quads have turned colors I never knew existed; like burnt toast. The bike down tube is cracked and very good, beautiful and cherished Orbea Orca carbon fiber bike is history. I'm lucky, frankly, to be alive ... The alternative is not appealing.

Once things settled down, several days later, and a mechanic suggested that some manufacturers offer deep discounts for bike frame replacements needed because of a crash, my wife found the e-mail address for Orbea and sent them this note: “...My husband was involved in a traffic accident with his 2008 Orbea-Orca .... He is apparently okay with major bruising but his beloved Orbea has a damaged frame on the post between the seat and the pedals. Is there an incentive Orbea offers to encourage customers to replace a damaged bike with Orbea? ... Thank you.

CANNOT MAKE THIS UP
The company response follows: “Good morning, Thank you for contacting with Orbea! In case of accident, Orbea’s Warranty is null and void. Sincerely, ...”

We never entered a warranty claim; that was never in my mind. My wife was merely checking out the status of their crash program. Some companies retain the loyalty of their customers by allowing them deep discounts to replace a damaged bike (product) and then studying the returned item for future research and improved manufacturing processes. My wife’s response was classic understatement: “We were not expecting to file a Warranty claim. We understand that some bike manufacturers give a discount on purchasing a new bike when a bike has been in an accident. You might consider doing the same.  We are in the market now for a new bike. Thank you for your concern.”

Lessons here are legion.

First, listen to your customer’s comments and requests. This reminds me of the classic instruction from a lawyer to his client: Listen to the question. Answer only the question. Then shut up! Wait for the next question. Don’t answer what you think should have been the question.

Second lesson: Everyone in your firm represents the organization. If a receptionist is rude, if a secretary fails to give you a message; if an associate is ill-prepared for a conference or court appearance, this reflects poorly on you as the senior lawyer and the firm as a whole. Education and training is not limited to the lawyers in the firm. Everyone needs to take continuing education programs to maintain and elevate skills and service levels.

Third lesson, don’t “piss off” the economic buyer (in this case, my wife) in your organization or you will never retain the business, and accompanying revenue.

Fourth lesson, live your life for now. There may not be a tomorrow. Yes, we have to keep an eye on the future, saving, planning and preparing. But, don’t do so without having some joy and value (your subjective opinion here) each day that passes. For me, the pleasure and reward is a vigorous bike ride, especially as a reward for something I did during that day. Whatever it is for you, “just do it.”

I’m sure you can provide other valuable lessons from this experience. Contact me or write your comment below. Let’s see how many lessons we can create from this one true-life experience.


 

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There is a song that suggests that "all things have a season ..."  And perhaps the time has come for the dismemberment of the mandatory bar, especially in California. My last post on the subject suggested that the current president of the Bar is doing a disservice to its members by complying with the implicit demand of the Legislature to eliminate lawyers from participating in the Board of Governors; lawyers should not elect its own governing body.

And, if you believe that the Bar has no business in addressing the needs of its members, then Mr. Hebert is right; the Legislature is right; let's create a licensing agency and do away with the Bar as we know it. Let's call it what it is, a tax, a fee for the privilege to practice law. A fee for the privilege to help people address their legal needs.  After all, we "tax" plumbers, accountants and others for their privilege of earning a living as they do and helping their constituencies.  Why should lawyers be different?  Assess the fee for licensing and keeping lawyers on the path (the disciplinary process).  And let lawyers form a voluntary association to provide economic advice and continuing education and lobbying efforts.

Seems simple.  But, the current discussions are off onto a different path. President Hebert says that the only goal of the Bar should be to protect the public; that any benefit to or for lawyers is incidental and of little consequence.

Yet, if he (the president and other members of the Board and Legislature) truly believed in protecting the public, the first step would be to understand what the public concerns are. And that would require looking at the state Bar's disciplinary report. If you did, you's find that more than 50% of the complaints there against lawyers relate to issues of managing a law practice.

The number one complaint is still the failure to respond timely to clients. To address this and other such time and practice management issues, one need only to provide appropriate education programs. Help lawyers be more effective with their clients and more efficient in the delivery of their services.  And, again, but only if you want to protect the public, require malpractice insurance at affordable prices. With its enormous buying power, California ought to be able to craft an affordable insurance program. The cynic in me says this won't happen no matter how the Bar is re-configured.

Oh, the mandatory part might show up ... but not the affordable part ... Why, because neither President Hebert nor the Legislature cares much about the average practitioner who helps the average citizen. That may be a harsh criticism, but it is apparent from observable behavior to date  of both.

Lawyers have a right to have spokesperson; lawyers have a right to have someone promote their interests in Sacramento. And lawyers have a right to organize for their own economic well-being. It's clear the State Bar of California is not doing any of this!

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Have you ever had problems traveling, making connections or finding that weather is a great excuse to be surly to those you serve? If you've ever experienced any of these, or a myriad of other issues facing us when we travel, check out my latest commentary on having been stranded in Manhattan, trying to get home from JFK. While bad weather is a legitimate catalyst for scrambling (as in Chicago), just remember that you're in the business and know these things happen. Be prepared with a good attitude - your customers need all the help and pleasantness they can get.

Thus, as lawyers, you know that your clients will always be in stress. Make sure that you and your staff are pleasant. It will make the relationship go more smoothly ... oh, and yes, they will be far more willing to pay your bills timely! Heed this advice only if you understand that you are in The Business of Law®.

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(Note: The California State Bar President asked  California lawyers to contribute to the State Bar's efforts to provide legal services to those in need. Following is an open letter to the President; his letter is set forth below.

 

Dear Mr. President:

 I agree with you completely. There is a tremendous "justice gap." I'm glad the State Bar is seeking to do something about this. I wonder, however, why the State Bar doesn't expend the same energy on helping its own members, lawyers. One study reported by the State Bar several years ago indicated that 50% of lawyers in this state earn less than $100,000. Just think, if the State Bar would actually help its members be more effective with their clients, be more efficient in the delivery of their services and, yes, be more profitable, members of the Bar would then i) be less tempted to invade client trust accounts (a public service issue) and ii) have money to contribute to narrow the "justice gap."

Instead, however,  the Bar does things that are perceived by our members to be antithetical to the interests of lawyers … The list is rather long and I won't bore you here with issues on which I've spoken before. But, until you (the organized, mandatory Bar) works with its members … until you (the organized, mandatory Bar) has as at least one of its primary goals the interests of its members, you have a great deal of courage (some might say gall) to ask struggling lawyers to contribute more than they already do.

If our Bar were a voluntary Bar, I suspect less than 50% would join … Then we would not have governance issues imposed on us by the legislature. Of course, we would also be far more interested in the thoughts and concerns of our members than is currently the case.

Clearly, these are my own thoughts, not those of any Section or other body of the State Bar … but these thoughts were clearly expressed to me just this morning by another attorney. I thought you should know, considering you're asking us for money.

And let me take this opportunity to wish you and your family the best of the holiday season.  You've taken on a very tough job, some would say a thankless job, and I wish you great courage and strength. 

Continue Reading...

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Today, a client called me to ask whether I know a compensation systems consultant who can help their firm create the right environment for non-equity partners to become equity partners. My response was i) compensation systems are a function of the firm culture and governance; ii) one first must analyze what the goals of the firm are and ought to be; iii) for any system to work, it must have the acceptance ("buy-in") of the principle stakeholders in the firm.

Most systems will work so long as the participants deem the system in place to be fair and reasonable. The system is better, in my opinion, when there are objective metrics in place. But, even subjective metrics work as long as the participants think there is fairness and justice working ... with an appellate process in place that is also fair and just.

Oh, by the way, I concluded, I do that! <g>

Apropos of this conversation, I read that another law firm is being sued for unfair compensation system that works against the women in this firm. See my earlier post on this subject.

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A new report discusses how a law department can make money for its company.

Assertion of rights (warranties and other claims) and prevention of wrongs (preventive law) are two ways to protect clients. This report describes one of the two ways. In the assertion mode, there appears to be a metric of "counting" the benefit that lawyers provide to clients. This may be what is needed to persuade management to pay more attention to its legal department.

Yes, the numbers can be significant. In this case (the assertion mode), however, the client must be willing to engage the lawyer/law firm/in-house counsel to be alert to those opportunities. In the latter case, the client must likewise be willing to engage the lawyer to show the client how to negotiate and/or structure customer relationship so that challenges/problems do not arise or at least are minimized.

In both cases, there must be a willingness to include the lawyer in the business process. In the former, we wait for a problem to arise ... and then claim credit for a return on the investment in the lawyer. In the latter, we are inserted into the process from the beginning ... and the ROI is more difficult to measure. After all, how can you measure or take credit for something that didn't go wrong in the first place?

Lou Brown was the "father" of preventive law. I "grew up at his knee" and learned a great deal from him. The concept of "preventive law" was a difficult one to "sell" to both clients and lawyers, especially in an era of good times and increasing wealth for lawyers. I suspect it will be a difficult sell even today, despite the even greater need for it. It's always easier to claim credit and persuade management that the lawyer is an essential part of the recovery process when you can claim credit for the flow of recovery money.

Good work and congratulations to those who prepared this report. Perhaps we will get closer to preventing problems by showing how we can cure problems. I'm not so sure though. This reminds me of the search for cures for lung cancer. The American Lung Association raises a lot of money and makes millions of dollars of grants to research for a cure for lung cancer. Yet, less than 5% of their grants are for behavioral research that prevents smoking, the primary cause of lung cancer. Why cure cancer so patients can go back to smoking, why create a cigarette with fewer carcinogens, when not smoking at all will take care of most of the problems?  Why set patients up so they can return to buying from the tobacco companies?

Seems to me to be the same here.  Warranty work (cure) is important, but better customer relations (prevention) is the better approach.

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In August 2009, the California legislature enacted a law requiring the State Bar to examine how it governs itself. I don't think any other state in the Union has a legislature overseeing the bar. This is usually a function for the State Supreme Court. However, in California, since the 1920s, the Bar must get permission for it to send out dues bills to members; thus, the legislature has the power to impact the legal system through the back door.

Does this remind you of law firms whose compensation structures govern what its lawyers find to be important? If the firm emphasizes and rewards new client acquisition more than work performed, that is what lawyers will spend their energy doing  ("eat what you kill").  If, on the other hand, the firm compensates more for hours expended, then focus on new client generation will go down and billable hours will go up.

The same is true in the relationship between the bar and the legislature. Today, with less than 30% of the members in the legislature having a law school degree, there surfaces an animosity between lawyers (the bar) and those (the legislature) who approve the dues to be paid by lawyers to retain their license. Oh, did I forget to say? California is a mandatory license state, meaning that you must be a member of the State Bar in order to practice law. Voluntary bars exist at the county and local levels, not at the state level. The state is mandatory. Voluntary bars exist, but only at the local (county and city) levels.

So, what's the big deal? The fear by legislators is that a self-regulating body (more than half of the Board of Governors are elected by lawyers; others are appointed by the Governor and others) will serve the interests of their constituencies, not the public interests. I thought that was the whole point of public members being part of the Board; they are, they participate and they have a significant influence from the Board. The legislature wants the Bar to "protect the public" only; the well-being of lawyers is unimportant.

More than 50% of lawyers earn less than $100,000, a relatively paltry sum when considering the number of years of education required and the good that lawyers provide. (Yes, I know there are a few bad apples, but that is true in every profession ... hmmmm, even with law makers.

If lawyers were helped by the bar and did earn more money, there would be far less temptation to invade clients' trust accounts. This would be real public protection.

I have yet to find a set of rules of professional conduct that favor lawyers over the public. And what the rules of professional conduct does not "catch," the penal code does. And sometimes rules are made that hurt the public.  For example, in the loan modification fracas, the legislature enacted a new penal code provision that made it a felony to take money from clients for loan mod work before the work is done ... can't even take money for the clients' trust account! The rules of professional conduct were similarly altered. But, no intelligent, business savvy, lawyer would now represent such clients unless pro bono. If the client has insufficient funds to keep the mortgage current, what makes legislators believe such clients will pay their lawyers after the modification is completed? The clients didn't suddenly get flush with money! So, lawyers will not now help the people who need help the most, those about to be kicked out of their homes ...

A new wrinkle to this, however, is that the law seems not to apply when a lawsuit is filed. So, the lawyer might take the client into bankruptcy or sue the lender on some pretense, all with the ultimate objective of merely getting a loan modification. This is more costly and adversarial than needs to be ... if the law makers kept their hands off! There were already rules on the books sufficient to punish the "bad apples" in the profession who were guilty of fraud on the clients.

Back to the main point: If the legislature removes governance from lawyers, the resulting agency will be merely a licensing and disciplinary agency ... and lawyers who volunteered their time and expertise to the bar for the benefit of many in the public and produced much good work will go elsewhere. That would be a grave loss that will hurt the public.

The Bar should push back and fight the legislature ... All the more reason for the separation of powers! Let the legislature do its job ... and this does not include determining how lawyers govern themselves.

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Insurance companies hire lawyers as in-house counsel at reduced (wholesale) rates, pay lawyers in accordance with insurance policies for their insureds, and otherwise have a dramatic influence over the billing practices in the legal community. Wasn’t it insurance companies in or about the 1960s that demanded lawyers submit bills that showed the time expended in matters for which they pay? And then, as a consequence, lawyers began using time increments as a basis for pricing, not just as a management tool. Before then, lawyers based their fees on the value received by the client.

Perhaps the insurance industry will, once again, have a dramatic impact on the legal profession, but indirectly this time. In Rhode Island, it’s reported that the Lifespan hospital group and Blue Cross have reached an agreement intended to overturn the way hospital care is financed. The goal is to promote and pay for health (value) rather than episodes (hourly) of treatment. Currently, when you go to a hospital, you pay (and the insurance company reimburses or pays directly) for your stay in the hospital, for tests performed and surgeries and related care. Does this remind you of the hourly bill that lawyers produce monthly (hopefully no less frequently?.

The agreement is the first to meet Rhode Island's unique rules concerning health insurance policies and their premiums. Blue Cross, the largest health plan in the state, and Lifespan, the largest provider in the state, have agreed in principle (details yet to be worked out). The program will provide for fixed fees (alternative, or value, billing) for given procedures, thus discouraging tests and procedures that might not be needed – but usually performed because of insurance payments or attempts to make sure “no stone is unturned” in the treatment. Does this sound familiar? Performing more discovery than needed just to make sure “no stone is unturned” and to avoid an accusation of malpractice for failure to uncover the hidden evidence.

The hospital will be eligible for bonus payments when they meet as yet to be determined quality standards. Again, does this sound familiar? Bonus payments for faster resolution of the litigation, payment for results below the insurance company’s reserve or other standards determined by the parties. Almost sounds like a sport’s figure’s bonus payments when playing more games or hitting more home runs, etc. than set forth as minimums in the contract.

Increased and more effective communications and streamlining payment processes to increase the hospitals cash flow are also part of the agreement. Again, does this sound familiar? When lawyers have effective communications in place, it is seldom that the client is upset with the lawyer and it is seldom the client refuses to pay in accord with the engagement agreement, thus increasing realization rates for the lawyer.

Tying payment to quality care is available elsewhere, but to a modest extent and never before to an entire state. The insurance commissioner in Rhode Island is mandating change in connection with premium rate reviews. As they say elsewhere, “follow the money.” In this case, when customers demand change, suppliers change. Here, the review process for payment of insurance premiums and health care will change, not overnight, but quite assuredly ... only because the customer (or regulator) demands the change. When will clients of lawyers finally say “enough is enough” and demand change? Until then, lawyers are not likely to alter current billing practices   

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The current political mood of the country seems to be that "less is more," at least when it comes to government intervention. A student of American history will note the changes and mood swings between federal/national involvement and states' action. On reflection, we may be going through one of those swings now.

A similar reaction is being generated by the mere mention of the American Bar Association reviewing the Model Rules of Professional Conduct to determine whether new rules should be created or old rules modified in reaction to the new technology. The problem is that new technology such as social media is merely a distribution method of ideas. Rules already exist that deal with statements to the public, advertising, self-promotion and the creation of attorney-client relationships, just to mention a few.

There is nothing inherently wrong with the ABA reviewing the rules. But, sole and small firm practitioners are fearful that the ABA will not stop at merely a "review." And, as Carolyn Elefant so eloquently pointed out, the members of the task force/commission that are reviewing the impact of the social media are, themselves, devoid of any personal experience with the media. That would be like someone with no newspaper experience at all seeking to create rules of procedure for the newspaper industry. Or someone with no automotive experience trying to design a car.

Here, the case can be made that there are now rules on the books; more are not needed.

Strange how this discussion takes me back to the conversation about the Bar preventing lawyers from taking retainers to do loan modification and loan foreclosure prevention work. Who does the Bar represent anyway? Ah, but that's another question for another day.

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There is a great deal of heat generated thus far over the ABA looking into the issues of internet marketing/advertising/promotion ... They have not overtly yet taken a position, only solicited commentary for the ethics commission to consider.

Yet, many bloggers and commentators believe that the ABA is seeking to destroy the marketing advantage gained in the social media by sole and small firm practitioners.

The mood of the country, as seen in the recent election, appears to be that less is more. (Though I believe that that is true only as an electioneering slogan -- just wait until "they" get into power.) Translating that feeling, though, into the legal world and we want fewer rules to regulate our conduct.

Yes, there are enough rules already on the books to protect the innocent and govern the "guilty." But, new technology does require a new look ... perhaps even a loosening of the current ad hoc rules. Frankly, I'd rather have the ABA review these issues than the many states who tend to take a far more restrictive stance than does the ABA.

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I was wondering how long it would take? 

Sarah Martinez, a recent law school grad, broke the ice. She has sued Howard, Rice, Nemerovski, Canady, Falk & Rabkin in San Francisco Superior Court for extending her an offer of employment, deferring it and now reneging, saying it didn't have the resources to hire anyone in the near future. Among the counts alleged are racial discrimination, sex discrimination, and breach of contract.

While every case stands on its own facts and merits, it's clear that Big Law will have to alter its offering policies in the future. The impact on law schools and those coming up through the grades is yet to be determined, but I suspect it will dramatically alter the economics of the future practice.

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I've talked about internships for lawyers. We've discussed articling in Canada. And now I find out that the State of Georgia has a mandatory mentoring program for brand new lawyers. Perhaps we're not so far away from the internship process. On the other hand, since Georgia has been working this path for quite a few years and others have yet to follow, perhaps it's still a pipe dream that even the current recession won't make happen at either the law school or Bar level. It may still take the combination of law firms and client demands to create an effective post-law school education program for learning how to become a lawyer.

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Today, I had a discussion with a very bright individual who is seeking new office quarters. He was having difficulty with the math, so he thought. He was seeking to understand the interplay between basic rent, common area charges (charges for maintenance, taxes, etc. that the landlord assesses at the end of each lease year to cover the cost of operating the building, paid pro rata by each tenant), and his actual cost of occupancy (total actual rent!).

I suggested that he walk away from this bottom down thinking. Instead, I suggested he look at the situation bottom up, and get his real estate broker involved to earn his keep.

First, figure out what you want to pay for monthly and/or annual rent. You can do this in a number of different ways. You can say that historically I've earned X% profit on Y number of revenue dollars; when I move into new quarters, I will earn more revenue because (better facilities, closer to prospective clients, larger space to hire more staff, etc.) and therefore, with the same percentage for occupancy cost, I can pay more .... and that number is $X.

Or you can say my revenue is likely to stay the same even after the move (or I'm not sure and I want to be conservative) ...  and don't want to pay more than the same rent I'm paying now. That number is $X.

With that number in mind, tell your broker to find you the space you require (with the specifications you want) for that amount. Don't worry what words are used, whether base rent or common area charges, etc. The lease contract must state that the maximum annual rent will be $X.

If the broker says that you can find plenty of space for that amount, great; if he says you're crazy, there is no space for that amount, then you have choices to make: Work harder, work smarter to earn more revenue/profit to pay the higher rent, reduce your profit and take-home pay, or join forces with another to share the space and cost of the space.

But, don't let others dictate how you should think. Don't let the system force you into a thinking pattern that will confuse you or prevent you from knowing what your cost of operation will be.

 

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As quoted by Alan Weiss, citing an IBM survey, CEO's focus on three elements:

1. Embody creative leadership (take prudent risk, invite disruptive innovation)
2. Reinvent customer relationships (set priority of customer intimacy)
3. Operating dexterity (flexible cost structures and opportunistic capabilities)

Shouldn't this be what law firms do? Take prudent risk to grow the practice and enhance the well-being of its members and staff; focus their energies outward, to benefit their clients, which would include both pricing and costing flexibility.

Too often, law firms are all about their lawyers, and they forget the well-being (intimacy) of their customers/clients.

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Save the date!  The Midwestern Law Firm Management Conference will be held in Chicago on September 21st and sponsored by West ... Save the date! And plan to attend at the Chicago Bar offices.

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A Texas law firm lost its defense against a lawyer whom it hired. The plaintiff worked for another law firm and was lured away based on alleged representations of the future of the firm and the collegiality of its founding partners.

In today's economic turmoil with an increase in lateral movement, does this mean there will be an increase in litigation from dissatisfied lawyers claiming negligent misrepresentation when their compensation is less than desired?

As my mother used to say, be careful what you sow - it impacts what you reap. If you encourage a lateral move and it produces less than outstanding results for all concerned, can you expect to be sued? And, depending on how you do entice the move, are you at risk of being sued by the first law firm for interference with contractual relations?

We may be encouraging a new specialty in the law ... lawyers who sue law firms for something other than legal malpractice!

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Join us on LawBiz Forum in the discussion about legal education and the current reexamination of its efficacy for teaching management skills for success.  Will the law school tumble into the morass of being a trade school (heaven forbib!) by including such skills in its curriculum? Let us know what you think ...

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West Pub. Co. has announced the pre-release offering for my new book, Growing Your Law Practice in Tough Times.

I'm very excited about the new book ... and encourage you to take advantage of West's offer. You can also see the new offering at LawBiz.

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It's reported in today's Los Angeles Business Journal that SBA loans have evaporated. "Banks really are stingy..." is the headline. Small Business Administration guaranteed loans, funded by banks, have fallen by 53% from the 2008 level, a year in which the number of loans also decreased from the preceding year.  This is further evidence that banks' credit for business and for real estate ventures has been dried up.  With TAARP money going to make financial institutions healthier rather than a stated purpose of loosening credit strings to jump start employment and business activity, the financial executives just don't get it.  They wonder why Main Street is upset with them as they sit back and take large bonuses; if they also were to spend the funds to help as intended, I suspect the American people would not be so upset. Also, in U.K. where there will be a 50% tax on bonuses. Wow.  Wake up Wall Street and bankers before we tumble backward ...

Law firms seeking either an extension or increase in their lines of credit are walking in this same environment. It's tricky, at best, and possibly disastrous. Creating and enhancing a good working relationship with your banker is even more critical in these times. That's the point I make in my book, The Successful Lawyer Client Relationship: A LawBiz Special Report. Just as lawyers are being told to create a "partnership" with clients, so, too, they should create a "partnership" with their banker. This will pay dividends.

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Yesterday, a jury rendered a unanimous verdict in a very much watched criminal trial in Los Angeles Superior Court. This wasn't so spectacular as the O.J. Simpson trial, but to those involved, it was equally dramatic.

The courtroom gallery was filled to capacity Monday as a jury of seven women and five men announced it had convicted former emergency room doctor Christopher Thomas Thompson of assaulting a pair of cyclists last year by abruptly stopping his car in front of them. The jury found that Dr. Thompson ignored the rules of his profession and allowed road rage against cyclists in general to get the better of him in attacking two cyclists in particular. He will now pay the penalty.

So, too, lawyers must share the road ... involve staff and clients in the development of strategy and implementation of tactics in order to provide the best and most effective representation for the client. As I said in another context, there is no "I" in Team ... and teams almost always achieve better results.

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Today, I talked with a solicitor from London who is studying knowledge management and its implementation in UK firms to increase profits.  Since much of their work is based on fixed fees, any improvement in efficiency will go directly to the bottom line. 

They even employ a group of lawyers whose primary function is to improve their knowledge base, organize it and make it more searchable, all with the view to reduce the time needed to create documents for a new transaction and increase the margins of profit.  These lawyers do not engage with clients; their focus is on the infrastructure of the firm and its improvement.

Since her firm (she says most are like hers) uses only the fixed fee billing model, there is no focus on the billable hour; this, then, allows the focus to be on efficiency. Thus far, American law firms do not use this model much ... and thus their focus on cost cutting today is primarily because of the decrease in demand they've experienced from the crises of their clients. That is a far cry, however, from having a focus on efficiency ... Cost cutting and efficiency are not necessarily the same.

An interesting contrast presented today by the solicitor:  Increased profit by increased efficiency under a fixed fee engagement agreement.  While the American law firm model is increased profit by incresing the hourly billing rate.  As clients begin to revolt at annual price increases, American law firms will need to look at alternative fee arrangements to keep clients ... then, their focus might turn to efficiencies in the delivery of those services.

My wife is fond of say, "there is no free lunch."  The fixed fee approach is not necesarrily a panacea for profitability. With a fixed fee, there is the inevitable pressure to reduce that fee and squeeze the firm's profit margins. It's an easier target than is the billable hour (where the number of hours can be fudged without much challenge). But, that's another story for another day.

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A recent quote from Associated Press:  "The economic downturn has meant less work for law firms, fewer experienced attorneys leaving jobs and thousands of lawyers laid off. From August 2008 to August 2009, total law office employment fell by nearly 26,000 jobs, a mere 2 percent but striking for an industry accustomed to constant growth."

Of course, these figures ignore the larger impact on the profession: small law firm lawyers who are being laid off, sole practitioners and small firm lawyers who are experiencing lower demand for their services and law school graduates who are not finding work in any size law firm.

Just today, I met someone who, in frustration, said to me that he’s a college graduate, yet has to sell vacuum cleaners. Will today’s lawyers find themselves in a similar state?  How can today's law graduates who don't find immediate work and lawyers who have been laid off take advantage of their legal education and still feel good about their vocation?

I do believe times will be better. But, having gone through the last great meltdown after the Vietnam war, I believe it will take more than ten years to forget the current recession/depression ... For some, there are great opportunities even today; for others, adjustments will be needed, and the passage of time.

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Bullies cost you money! Addressing this topic is not a "soft skill" but one that goes right to the "bottom line." Tolerate bullying in the workplace and you will experience lost time, lost ncentive and lost resources when skilled staff take time off from work, lose motivation or suffer stress burnout and leave the job for another. The cost to business is in the billions of dollars annually.

The converse is true. Creating a culture of collegiality, cooperation and teamwork creates enhanced performance, greater successes and even higher profits.

Bullying, by definition, is unwelcome behavior including unwarranted or invalid criticism, exclusion and isolation, being singled out and treated differently, and being humiliated in front of others. One study shows that younger women suffer bullying at the hands of older women ... but this phenomenon is not limited to women ... and sexual harrassment is only one aspect ...

Male clients find often find that how they respond to the bullying tactics of their male superiors is a critical feature of whether they succeed in the law firm and whether they make partner or are asked to leave.  Irrespective of how they deal with bullying tactics such as imposition of unreal time deadlines and nitpicking of their draft documents, the psychological toll on the lawyer is humongous ... including stress in their home life.

In one such experience, I helped a client negotiate his way with the supervising partner through a particularly stressful project. On its conclusion, I suggested that he stop on the way home to buy flowers for his wife. I explained that his wife had been a "passenger" through his recent difficulties ... and that since he had come out the other side successfully, he needed to share some of the good times with her ... She had supported him without knowing the details and deserved recognition for her efforts. He later reported that his consideration was a huge success!

Had the firm's culture not tolerated this bully, their productivity and profitability and bonding would have been significantly higher.

Yes, bullying is exaggerated in times of recession and credit crunch, if allowed ... But, it need not be.

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News about the health care reform package is getting more interesting. As we get closer to a vote of some kind, the identities of the players and respective positions are becoming more clear.

In today's analysis, the drug companies are joyous. If universal health care is adopted, the pharmaceutical industry benefits ... with more folks insured, more drugs will be prescribed that will be covered by insurance ... to their benefit.  However, insurance companies will hurt a bit ... no one is yet sure how much. With more people insured, their costs presumably increase. With the right to maintain - retain insurance despite the loss of employment, COBRA income goes down. With prior medical history being irrelevant for coverage, insurance carriers will have to take on some risks they would have eschewed earlier. Hmmmm. Sounds a bit like mandatory auto insurance. The details are not so significant to the ideas here and certainly not to some of the stakeholders.  Can you name them all?

In your law practice, even if a sole practitioner, can you name all of the stakeholders? How do you seek to reconcile the differences among all of your stakeholders? As I mentioned in an earlier article, providing value is the name of the game in today's world. And how much more value could you provide with the stakeholders on "the same page," all working together for you and the same goal? And with that, how much more profitable would your firm be -- how much more income would you receive -- if you could create harmony among your various stakeholders .... such as clients, associates, staff, assistants, et al.?

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I listened to a fascinating interview today about dogs seeing the future. Alexandra Horowitz’s “Inside of a Dog: What Dogs See, Smell, and Know” draws on that of an early-20th--century German biologist, Jako