Social networking - Even for Airstreams
Have you ever heard of giving a war and no one came?
How about going to a Vintage Airstream Rally with no Airstream?
That’s just what we did! Our vintage (1969) 27' Airstream Overlander was broad-sided on December 30th last year and then totaled by the insurance company earlier this year. Thus, we are bereft. I use that word advisedly. My wife really is bereft at not having our SteSpot at ready!
But, despite that, we went to Albuquerque this week-end to spend time with folks that we’ve gotten to know and like ... and view others’ vintage rigs. Our “new” vintage 1968 28' Airstream Ambassador is currently under construction and we thought that perhaps we'll see things we just must have in the new trailer.
How can I use the two words, vintage and new, in the same context? Well, the skin of the trailer is 1968, but the inside will be all new. We have stripped it to the ground, literally, and started over with brand new equipment. So, my wife’s passion for old will appear to the world as an old skin buffed to a bright sheen and my enjoyment of the new will be inside, which is where I spend my time.
In the meantime, we’ve met more folks and, as my wife said, “networked” with the Airstream world. Or in the context of lawyers’ recent awareness, expanded our “social network.”
Whether you social network in LinkedIn, MyFacebook, or other social networks, or meet people at places you frequent or in activities you love to do, connecting with people is the way to build your law practice. People seek people they like; they do business with people they like; they like to do business with people who have similar interests. What’s yours? What are you doing to extend the reach of your passions and the people who will know to refer business to you when they have challenges you can address?
Lawyers core competency - Must we specialize or be incompetent?
In a recent Los Angeles Times article, the headline read “Double-O: Better for Obama than Oprah.” The writers of the article cite a study by a Fordham University political science professor. He concluded that her popularity went from 74% before the endorsement to 56% and is currently at 46%. He suggests that Oprah’s endorsement for Obama was far more costly to her than might have been imagined.
It also brings to my mind Corporate America’s lesson: Stick to core competency. PSA, an airline formerly based in California, for example, expanded beyond flights to operating hotels and rental cars, among other enterprises. They considered themselves to be in the entertainment business. But, this expansion extended them beyond their core competency, transportation. The market place ultimately punished them and they were acquired by another airline.
Railroads, in the early 20th century, considered themselves to be in the railroad industry and therefore ignored both the new car industry and the airplane industry. Here, in the reverse, they mis-calculated. They were in the transportation industry, not the railroad industry ... and the other forms of transportation “ate their lunch.”
In the case of media stars, what is their core competency? Does Oprah know how to evaluate politicians more than the average American voter? Does she risk her high status by moving into the political arena? What would happen to Lance Armstrong, the renowned winner of the Tour de France, and his efforts on behalf of cancer victims, if he were to take sides in politics? Would he have the same moral authority?
What happens to lawyers when they seek to be all things to all people? Do we need to focus on limited areas of practice, to enhance our competencies and our credibility with clients? There is tremendous learning required to be competent in any given area of practice. Can one lawyer maintain his/her competence in many areas at the same time? Can one truly be a general practitioner in today’s world, or must a group of lawyers gather together in one firm or one network to offer multiple skills to clients?
Cash flow of lawyers is impacted by insurance proposal
Mike McKee, a reporter for the San Francisco Recorder once again underscores the hostility that California lawyers have against the current malpractice insurance disclosure proposal.
Still, the question I asked earlier in this series has yet to be answered by the Board of Governors! Why is it that shareholders of law professional corporations do not have to disclose that they do not have malpractice insurance? Or, at least meaningful malpractice insurance? All they need to do is sign a piece of paper saying that they will be responsible for the first $50,000 of a malpractice judgment. There is no financial statement required, no verification of financial ability and no insurance policy required under the current rules; nor is there any such requirement under the new proposed rule!
And why is this fair in the minds of the Governors supporting this proposal?
Is the billable hour a trap? A contrarian perspective.
In Law Firm Fees & Compensation: A LawBiz® Special Report, I discuss several formats for billing legal services. Jeff Bleich, President of the State Bar of California, discusses one of these formats, the billable hour in his April column of the California Bar Journal. He raises the specter of the “billable hour trap.” He maintains that the profession must change its fee structure and move away from the current policy of billing by time. He reflects the thinking of many lawyers who are feeling the pressure of working long hours.
Because of his comments, I began to think about this subject in a way different than I have ever done in the past. I want to share some of my revelations as, perhaps, a catalyst for your further consideration on what clearly is a very important issue.
First, is the billable hour truly a trap? Or is the desire for economic rewards in a society whose cost of living continues to increase the real trap? Lawyers, no different from any other segment of our economy, want to earn a “reasonable” living. In fact, if asked, most lawyers would admit they would like to earn as much as possible. Just look at the many lawyers both in large firms and boutique firms who accept million (multi-million?) dollar annual compensation packages. And consider the many lateral moves by lawyers made primarily for their personal economic betterment.
Second, the assertion that our ethics rules are promulgated to resolve clients’ problems as cheaply and efficiently as possible just is not true. Our rules maintain a certain amount of decorum and boundaries to assure that we fight for our clients within the same sandbox and don’t sneak in an 800 pound gorilla. Nothing more, nothing less. For example, there is no punishment to the lawyer who refuses to discuss settlement ... until the time of trial. In the meantime, both sides have rolled up many thousands of dollars in wasted legal fees ... despite both sides being able to closely predict the outcome of the matter in question. There is no requirement that legal work be outsourced, either to India or to another law firm down the street with less overhead and lower fee structure.
Third, lawyers are not the hardest working folks in our economy. Yes, some are. But, I came from industry. I worked in a family business. I owned and operated several manufacturing ventures. I knew long hours before I ever practiced law. Talk to the CEO of companies and they will regale you with stories of long hours and hard work. Lawyers do not have a monopoly on hard work.
The billable hour is only a method of accounting; it is not the reason we work long hours. We work long hours because we love what we do; we love helping people; and we want to earn more money to better take care of our loved ones. Billable hours merely provide a method of accountability for those clients who may not see the value of what we do. If clients, in fact, fail to understand our value, we have failed to properly communicate with them and we have failed to understand the value to the client of what we do.
If we use a different method of accounting, such as “value billing” or fixed fees or any of a number of other methods, and we fail to have the “value conversation” with our client, they will continue to fail to understand what we do, why we do it, and how we helped them. And, they will then procrastinate or refuse altogether to pay our bills. And, we will continue to work long hours ... if that is our proclivity ... because we want to do more and earn more.
Lawyers wanting to do better for themselves drives much of what they do. President Bleich said the Bar helps lawyers only to better serve the public. So, too, I believe that lawyers will change their billing approach only when they understand how it will benefit them. Protecting the public will not be the motivator, though it may be the sales pitch used to attract more lawyers to a different method of billing. Remember the airline mantra, put your oxygen mask on first and then attend to your children.
Finally, President Bleich suggests that we must act as a profession. Years ago, in focus studies done by the State Bar of California, I learned that people view the profession one lawyer at a time, usually their own rather than the opposing lawyer. So, I ask President Bleich if he is billing his clients still based on hours, or is he billing his clients based on value? Has he followed the example of Patrick Lamb, an attorney in Chicago, who left a well-respected firm in order to open another law firm whose billing goals are based on value? This is one lawyer at a time.
President Bleich raises an important issue. I respectfully disagree, however, with the framing of the issue. I don’t think it’s a matter of the billing method used, but rather of failing to have the discussion about the value of the matter to the client ... and the consequences that would follow from an open and candid conversation with the client about value.
LawBiz® Tips
The April 8th edition of LawBiz® Tips is now “on the stands” for review.
Solo lawyers and malpractice insurance debate
Sole and small firm practitioners have more at stake than insurance in the current debate at the California Board of Governors over mandatory disclosure of malpractice insurance coverage, much more! Their very existence is threatened. Perhaps that is an overstatement. What is clear, though, is that the economic well-being of this group, and the very survival of many individuals in this group, is being threatened.
Jeff Bleich, President of the California State Bar, states his case very succinctly in the March 2008 issue of California Bar Journal. He starts by saying “... small and solo practitioners are justified in demanding that the State Bar be more sensitive to their concerns...solos have a right to demand that any new obligation imposed by the State Bar is there for a good reason ...” (Emphasis added.)
But, President Bleich counters this philosophy, however, in his very next column (April 2008) when he says “The work of the State Bar ultimately is to protect the public and to ensure that the people of California have access to the legal help they need. Although the bar (sic) provides benefits and other services to lawyers, it does this not as an end in itself, but instead to help lawyers better serve the public ...”
It appears quite clear from his comments that he believes the Bar has only one goal, to serve the public. What happened to the Board’s pronouncements two years ago when then President Jim Heiting said the Bar has two, co-equal goals, one to protect the public and the other to protect its members, lawyers, who need help in many different areas in order to be more effective and efficient in delivering legal services to the public? Has one of these two symbiotic, intertwined priorities now been abandoned? Seems to be ... especially if we believe that helping lawyers is only a means to an end, not a co-equal end!
Again, I ask why this group of lawyers have been singled out? California Business & Professions Code 6171 (b) and Law Corporation Rules created thereunder allow professional corporations to escape this requirement!!!! Under Rule IV of the California Rules, shareholders of a professional corporation can sign a simple statement that they will be responsible for paying malpractice judgments. Do this, and you don’t need malpractice insurance! The last time I checked, a sole practitioner is personally liable for any such judgments anyway ... So why do we need to have the current proposal adopted by the Board of Governors? Why is a group of 30,000 sole and small firm practitioners being harassed?
There continues to be no evidence that mandatory disclosure of whether a lawyer has malpractice coverage is necessary to “serve the public.” There is only anecdotal suggestions. But this commentary appears on both sides of the issue as is evident in Letters to the Editor of the California Bar Journal. Continuing to pursue this action infers that sole practitioners without malpractice insurance are “bad” people. Yet, this group of lawyers is not subject to more malpractice claims than others. They are good lawyers, just economically challenged by the cost of malpractice insurance.
There has never been a suggestion that the Board is controlled by the insurance industry. But, it is true that the Bar receives many revenue dollars from the industry. And, contrary to President Bleich’s inference, the current Bar insurance programs do not claim to provide lower cost insurance to California lawyers. In fact, to this date, when asked, those on the insurance committee will admit that there are less expensive programs available elsewhere.
President Bleich says the current proposal doesn’t require the purchase of insurance ... does this serve the public? Does not requiring the insurance, but nevertheless attacking lawyers' economic interests, indicate a sensitivity by the Board for sole practitioners? I think not. What would serve both the interests of the public and the lawyers is to have affordable insurance available. Until then, there should be no meddling with the current status quo.
Lawyers will be hurt; that is, those estimated 30,000 lawyers (without reference to those in professional corporations) who currently do not have malpractice insurance will be hurt. And if they are hurt, their clients, typically the people who cannot afford the large law firms, will be hurt. Here’s the rub: How does this provide greater access to the legal help the public needs?
