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November 2007

How Truly Valuable is an Attorney?

You’ve all heard the jokes.  People love to make fun of attorneys, and is not unlikely that you have not told a lawyer joke or two in your day.  However, since I am now an attorney myself, I’ve really begun to think about the importance of my role in society.  By no means am I tooting my own horn, or the horn of any other attorney, but rather taking a candid look at the value that an attorney “can” add to a community, to a business or to any individual for that matter.  Note that I said “can” instead of does when I said that an attorney can add value to society.  The reason being is because, like any other job, you can accomplish what you set out to accomplish.  The title doesn’t confer anything.  Rather, it is what you do with that title. 

Now that I’m approaching my first full month of being an attorney, I realize how important and valuable I can be.  Granted, I see how important my partners actually are on a daily basis, and I see the amount of value they deliver to our clients.  That being said, I know that I can be just as effective as my career grows and hopefully prospers.  For example, every day I see how valuable an attorney can be to helping someone get their business off the ground.  Whether it is developing a new brand, trademarking the name of a product or service, starting an LLC or other corporate entity, or drafting the documents and contracts that will dictate how the business will function, these are all critical foundational elements with which an attorney helps businesses and/or individuals in order to get things moving.  Furthermore, while criminal work is not my practice, we all see how important attorneys can be to the wrongfully accused or how important prosecutors can be to the family who has lost something or someone.  Regardless, I’m a believer that a lawyer can make a difference and be as important and valuable as he or she wants to be.  I still believe that being an attorney is a noble and coveted profession.  My goal is not to be important for the money or for the fame, although both are nice, but rather to deliver value to the small business owner or to the corporation or to the individual who needs me to help them accomplish what they want in life. 

What it really comes down to is that people who want to do important things usually seek the advice and counseling from the all important attorneys themselves.  Will you be able to deliver the value?  ~Brian

Things That I am Thankful for.

Thanksgiving is a great holiday.  There are no gifts or shopping or unnecessary candy.  The point of Thanksgiving is to give thanks.  What a great holiday. 

I am thankful for so many things.  Here are a few:

  1. Smart, healthy well behaved kids who seem to have an appreciation for the more important issues we all face as human beings.
  2. A wondrous city in which to live, Traverse City, which is not too big, not to small and amazingly not pretentious at all.
  3. The fact that my wife and I continue to grow both as individuals and in the context of our relationship, in a creative, dynamic and unpredictable way.  Maybe it was something to do with the fact that we didn’t know each other at all when we got engaged?  There’s something amazing about waking up each day and being able to recreate yourself without your spouse being concerned that you have “changed.” When you don’t really know who the other person is to start, there are few limiting expectations.  Luckily, our relationship has continued to embrace the concept of change.
  4. My barter relationship with the owners of Broneah, the largest kiteboarding camp in the mid-west.  I completed my third camp last year and am very close to being a full-fledge kiteboarder.
  5. My new partners at Traverse Legal who are helping me build one of the most innovative law firms in the world.

Visualizing Your Legal Future

I’ve been posting a lot recently on how and why things in life happen.  In starting this law firm, I clearly took some level of risk.  It always seems strange to look back on your start-up experience.  In retrospect, it seems slightly crazy.  The timing of my departure was all wrong.  I had approximately five trials coming up which would have dominated all of my time.  Several of the trials were contingency fee trials for which I would have no immediate revenue.  I told my law firm before taking any affirmative steps to start-up the business.  This meant I had very little runway to take off from. 

So how did it all work out?  How did everything fall into place?  The answer has very little to do with realistic expectations, logical business plans or the like.  The truth is that our law firm launched because of my unwavering knowledge that it would. I didn’t “believe” I could do it.  I didn’t plan to insulate myself against failure.  I didn’t have an expectation of success.  I knew as sure as I’m sitting here today that my firm would succeed.  I knew my websites would drive business.  I knew my alternative billing model would be superior to the ones offered by other firms. 

It was my absolute knowledge (notice I didn’t say faith) that I would succeed which caused the success.

Understanding the Back End Numbers

We have really dedicated ourselves the last 45 days to improving our knowledge of the back end numbers for our firm.  Now that I have additional resources with Brian and Mark, it is easier to get into these types of issues.  Essentially, we have several pieces of data we’re focusing on.  The first is to understand what we are billing on a flat fee basis for each month, as well as the hourly billing (typically the litigation).  Last month, for instance, we were 70% flat fee billing.  Until we start to track and compare numbers month to month, we won’t be in a position to ensure the firm is going in the direction we want it to go.  For instance, we have prioritized flat fee billing.  For the client, flat fee billing means a defined number for defined deliverables.  Flat fee billing makes attorneys accountable for results.  For the firm, the advantage is a clear set of expectations with the client and upfront payment.

My message is simple.  If you really want to improve your business model you have to get into the back end numbers.

Big Law and Passing the Bar

I guess if you work for big law, and you don’t pass the bar, you’re essentially fired.  I don’t know too many people who work for big law who didn’t pass, but it has to be a death blow. 

Needless to say, Brian passed the bar with flying colors, scoring 160 on the multi-state.  They didn’t even grade his essay questions. 

Of course, Mark and I knew he would pass with flying colors.  But it does raise the interested question I posed earlier.  Are bar results really a good indicator of performance as an attorney? 

It’s Amazing What Lawyers Get Away With

I met with a new prospective client this morning who was thinking about changing counsel because an experience he had recently had with their current counsel.  Essentially, the attorney had failed to keep the client informed.  When the attorney dropped the ball, the attorney failed to provide that information to the client.  Once slight of hand led to another.  Before you know it, the client had thousands of dollars wrapped up in a legal project that should have never been started in the first place.  Of course, the lawyer charged the client for every mistake along the way that the lawyer had in fact made. 

The interesting part of this story isn’t that it occurred.  It is the brashness that some attorneys have concerning their own mistake.  Let’s say for the sake of argument that the attorney really did put in every one of the hours that was billed (which would be hard to calculate since that attorney provide no accounting of the number of hours despite the hour billing model, instead merely providing some narrative information with a final tally), the lawyers refusal to take any responsibility for events along the way is astonishing.  The hourly billing model limited this attorney’s ability to see anything except his own hours.  The drive to get paid for each and every minute spent on a client matter drove the attorney to bill every minute, even for all of that attorney’s mistakes along the way.  To suggest that the client should not have paid for that activity would seem pure common sense to most of us.  But to the hourly billing lawyer, such a suggestion is blasphemy. 

People sometimes wonder how hourly billing has become such a bad business model for clients.  The truth is hourly billing didn’t start out this way.  But over the decades, lawyers devoted to hourly billing continued to see the only way to raise revenue, profits and their own income was to find new and creative ways to bill hours.  Before you knew it, meaningless client phone calls were being billed by the hour.  Transmittal letters with no real information included were being billed by the hour.  Review of meaningless court paperwork, which probably took less than one minute of attorney time, were being billed in 18-minute increments.  Unsolicited letters from lawyers who had no pending matters were being sent to clients.  And those clients were thereafter being sent for bills.  Lawyers who contacted or solicited their clients for new work were sending bills for their solicitation letters.  Lawyer screw ups were billed identically to all other activity on the file.  And to suggest that a lawyer would eat two minutes of their time was viewed as an attack on revenue.  Any longer, there was no reason for lawyers to take any risk with the client, discuss or invest in deliverables or even think strategically on their client matters.  The business model was hours, not value.  Lawyers began to wake up in the morning thinking of nothing else except how to create a billable event. 

Needless to say, this lawyer lost their client’s work this morning.  They don’t know it yet.  And when the find out, they’ll think someone is attacking them and their client base.   They won’t for a second take a shred of responsibility for their own failures and inappropriate billing tactics.  They will have become so obsessed with their own billing sheets that they will be incapable of learning from their own errors. 

Standing in Front of Brian’s House Waiting for Bar Results

Do you remember when you were waiting for your bar results?  I’m standing with Brian and Mark in front of Brian’s house.  We’re waiting for Eric the mailman who is two houses away.  Even though everyone else got their bar results yesterday in downstate Detroit, northern Michigan bar results don’t arrive until today.  There’s two houses left before Brian finds out whether or not he passed the bar.

What’s the point of the bar exam anyway?  Does it really become an indicator of success?  Do you lawyers that pass the bar exam on their first try automatically become good lawyers? 

Well, Eric’s almost here.  We’ll let you know how Brian does if he passes.  If he doesn’t, this will be the last post on the matter…

The Next Three Things.

I always say that the practice of law is easy.  It's just identifying the next three things that need to get done.  With our business model, the next three things get dictated and uploaded into the extranet and, of course, assigned. 

But really, defining the next three things is not as easy as it sometimes seems.  A reactionary approach would allow the next three things to simply be revealed.  A proactive approach aggressively identifies the next three things which must happen in order to win.  Figuring out what the next three things should be is the real value a lawyer brings to the matter.  Picking the right three things will make the difference between success and failure. 

Refusing to Allow Your Client to Fail

Perhaps the most difficult part of running a client-centric law firm is making sure your clients don’t fail to realize their defined goals.  While an extranet system works well in setting client expectations and assigning client key tasks, the most important ingredient for success in any client matter is the lawyers willingness to get involved. 

At Traverse Legal, we take a stake in the outcome we’ve helped to define with the client.

Sometimes, clients don’t get back to you in a timely fashion.  There may be important information or tasks they need to complete.  You may need client approval on the next phase of the case.

A good lawyer helps the client realize defined goals.  A great lawyer demands that the client protect their own interest, get their tasks accomplished and see the matter through to conclusion.  A great lawyer is proactive when it comes to the client’s interest.

One of the many problems with hourly billing is that it fails to align the client’s goals with the lawyer’s goals.  Hourly billing drives complacency when it comes to accomplishing defined deliverables. 

So what if you do if a client isn’t responding in a timely fashion?  The best technique is to pick up the phone and call.  Emails can often get lost in the shuffle. If is easy to ignore an email, especially if it’s asking you to make a tough decision or perform a task.  An even better way is to have your staff schedule a meeting.  Again, email may or may not move the ball.  Picking up the phone, getting a live body on the other end and forcing the issue is sometimes part of the job.  And if you can’t get an office meeting scheduled, try a conference. 

At the end of the day, the lawyer is the one responsible for the deliverables and the outcome.  Using the client as an excuse won’t get you very far.  For firms that live and die by the value provided, lawyers are driven to push a matter through to completion.  They do it because the can only see value as the commodity which is bartered.  And a bad result reflects on them as much as it does the client irrespective of the cause.