General Practice, Solo & Small Firm DivisionMagazine
The Business of Law®/by Edward Poll
Can We Survive?
© American Bar Association. All rights reserved. Edward Poll, J.D., M.B.A., CMC, is a certified management consultant in Los Angeles who advises lawyers and law firms on how to deliver their services more effectively while increasing profits. He is the author of Secrets of the Business of Law: Successful Practices for Increasing Your Profits and The Profitable Law Office Handbook: Attorney’s Guide to Successful Business Planning . To comment on this column, call 800/837-5880 or send e-mail to firstname.lastname@example.org .
What does the Cape Hatteras Lighthouse on North Carolina’s Outer Banks have in common with the legal profession? They’re both fighting for survival. Due to the shifting of ocean currents and the erosion of the once-wide beach that has protected it since its construction in 1870, the tallest lighthouse in North America is in danger of crumbling into the sea.
Similarly, events and circumstances—some beyond anyone’s control, but others firmly within the grasp of lawyers themselves—are threatening to erode the foundations of sole and small-firm practice. For example, lawyers antagonize clients to the point where they file more complaints with state bar associations than there are lawyers in the state. In California in 1996, there were 130,000 lawyers and more than 140,000 telephonic complaints to the bar. Nevada and other states have similar statistics.
Some state bars have lost the confidence of their members. California is the first state to have its mandatory bar status examined under the political microscope. The governor vetoed the 1998 bill to approve the bar’s dues and sent a stinging message that the bar has failed its mission. He wants the power to appoint the members of the bar’s board of governors (who are currently elected by the lawyers in the state).
Since the legislature has not been able to develop a compromise, the State Bar of California has no money to operate. It is terminating employees, and it has shut down the disciplinary system. Lawyers in Texas and other states are also beginning to question the mission of their bars.
In addition to the loss of confidence from clients, the rising complaints by consumers, and now the loss of trust in lawyers’ own professional organizations, Congress has taken a little bit more from the plate of lawyers’ performance of legal services by recently passing a taxpayers’ bill of rights. One of the provisions in this bill extends to accountants a limited privilege (attorney-client privilege) when representing clients before the IRS.
This privilege has previously been the hallowed territory of lawyers in representing clients. However, many clients perceive that accountants can perform services just as well, if not better, at a lower cost. While one can technically argue that a responsible client would have a disincentive to engage an accountant since this new privilege does not extend to criminal and other matters beyond the appearance before the IRS, lawyers are nevertheless faced with more intrusion into traditional legal practice.
Lawyers will soon be faced with "multidiscipline practices" in this country. In Europe, Australia, and Canada, accounting firms provide services in many different disciplines, including the law. The largest employer of lawyers in the United States may be Arthur Andersen Consulting. In these kinds of practices, professional services are offered under an umbrella organization that provides accounting, legal, financial, and other services. It’s a "one-stop shop." Real estate matters are being handled by brokers with pre-printed forms for offers and acceptances. Employee benefits consulting firms prepare pension and profit-sharing plans without lawyers. Environmental and other consultants frequently give advice with significant legal consequences, but without involving lawyers.
Solo and Small Firm Practitioners
Can lawyers endure this onslaught on the profession? I believe the answer is a resounding "Yes!" While the keepers of the lighthouse have only two choices—leave it alone and let it be washed out to sea, or move it to a safer inland location—the legal profession has many alternatives.
Lawyers need to address the client’s concerns in a more effective and meaningful way than in the past. Lawyers must become more client-focused. It’s not important what you can do, what you want to do, or what you think the client wants. The only thing that matters is what the client actually wants. That means that you must start by talking with your clients, not just to your clients.
Clients crave communication with their lawyers and dedication to their concerns more than they want cheap fees. In fact, client focus groups indicate that clients understand that they must pay for their legal representation and are willing to do so—provided the lawyer is giving them the type of service they desire. So ask your clients about the type of service they’re looking for. Implement their requests, and tell them you are doing so.
Each client wants to be treated differently. That means you must be flexible; your staff must buy in to this process and become part of an effective team of "service providers." After all, without the client, there really is no need for the lawyer—or the staff.
Steps you can take to endear you to your clients include:
• Preparing a budget for the client’s approval.
• Sending short, easily understood status reports regularly to the client.
• Visiting the client’s site.
• Being realistic in your evaluations of the process and merits of the client’s matter.
• Returning telephone calls promptly.
Clients appreciate good service and even refer more clients to lawyers who treat them well. Most importantly, the client will look to a lawyer as his or her lead counsel—counsel in the original sense of being the first person to go to with a problem or challenge. And then you, the lawyer, will resume your traditional role of servicing the needs that you are competent to handle and bringing in your network of experts and advisors to perform the other tasks requested.
This is the way that lawyers can survive—and even flourish—as individuals and as a profession. We can progress and prosper by recognizing the importance of the client and the desire of the client to be treated with respect and care. CL