Launching a Virtual Law Firm

Vol. 31 No. 1

By

Chad E. Burton (cburton@burton-law.com) is the founding attorney of Burton Law LLC, a virtual law firm headquartered out of Dayton, Ohio, with locations in Cincinnati and Columbus, Ohio, and in Raleigh, North Carolina.

When running a business, you should always look forward while remembering past lessons and current circumstances. As lawyers, we have an interesting perspective that is beaten into our heads from the first day of law school: We always look to the past for precedent. In other words, how we operate on a day-to-day basis relies heavily on the way things were done in the past. You take existing court cases and laws and apply them to your facts at hand. On occasion you get to be creative and push new solutions, which, not surprisingly, are largely based on the past.

The common mantra is that you need to be running your firm like a business. This is true whether you’re a solo, small firm, mid-size firm, or big firm. The larger the firm, the more this mindset has been in place for years.

It gets interesting at the solo and small firm level. Many lawyers are not trained and educated on business processes. So, you either need to go and seek outside help or do it yourself. When starting a firm on a limited budget, lawyers tend to gravitate toward the latter: self-help. This is not a bad thing. It just ups the learning curve and the fun of getting started. The hope is that we recognize our limitations on running a business and eventually get help when resources exist.

So, how does the concept of the “virtual office” fit into all this? The virtual law firm is an emerging business model that helps lawyers think differently about how to operate their practice. It is a forward-looking mode of delivering client service. It runs counter to lawyers’ training on looking backward. This is a fascinating dynamic that we will explore in this piece. In particular, we will look at the concept of virtual law firms, how to launch one, different means of collaborating in such an environment, and the technology behind virtual firms.

The Virtual Firm Concept

The topic of virtual law firms seems to be quite hot and timely. The term has caught on and has evolved into different meanings. The range of models starts with solo lawyers delivering only online services and extends to multi-lawyer, multi-jurisdiction law firms offering full-service representation and online delivery of legal services. Those are the bookends, and examples range throughout.

Several core concepts are consistent across these variations:

  • Using cloud-based technology to operate the firm;
  • Working outside the traditional bricks-and-mortar office space;
  • Using virtual assistance for administrative work;
  • Using an online client portal to communicate with clients for the delivery of legal services.

There are other common traits, but these seem to form the basis of most virtual firms.

What really matters here is the state of mind and thinking about how to create and operate a firm. There is a strong argument that this “virtual” label is there to push the envelope into this different form of thinking. It helps firm owners avoid relying on “how things have always been done.” This way of thinking is easy to fall into, especially when lawyers are busy being lawyers (you know, serving those clients that have needs).

Technology, obviously, plays a significant role in these firms. However, it must be noted that you can have all the great technology in the world, but if the lawyers in the firm lack substantive skill sets and the ability to otherwise effectively work with clients, the technology is not going to be as useful as it should be. Technology cannot be a substitute for lack of skills. Instead, it enhances these skills.

Bearing this in mind, it is key to remember that the purpose of these emerging business models is to better serve the public. Any firm’s method of delivery must be client centric. When discussing the online delivery of legal services, the existence of this market has been established by the millions and millions of dollars driven by companies such as LegalZoom. The public recognizes that using the Internet in connection with legal services makes sense. The issue for law firms becomes how to integrate use of the Internet with the delivery of legal services in a way that jibes from a client perspective.

If firms aren’t utilizing technology to enhance client service, they are not going to their clients. We should be thinking about where clients’ needs currently sit and where they are going. It means being one, two, or three steps ahead. That’s more of a challenge. Fortunately, the tools exist to get there.

Launching a Virtual Firm Concept

Virtual firm models create a lower barrier of entry for lawyers to get started. This is true for the solo lawyer trying to start a virtual firm as well as the multi-lawyer firm spread across the country. Eliminating or reducing the need for physical office space reduces overhead. Eliminating full-time employees in exchange for virtual assistance lowers overhead. Eliminating legacy technologies requiring extensive server space that must be upgraded on a regular basis and maintained by IT staff (whether in-house or outsourced) and replacing these systems with cloud-based services lowers overhead.

When starting a new firm or converting a traditional firm into a virtual model, the vision and the goals will drive the structure. This is true of any business. Ask yourself:

  • Who are you going to serve?
  • What practice areas?
  • What is the tolerance of your team members regarding technology?
  • Will they adapt or revolt?
  • What is the best way to approach this concept with that team?
  • What geographic limitations exist?
  • Where do you see the firm in one, five, or ten years?
  • Do you plan on expanding to add additional lawyers? If so, how many and where?

Although the answers to these questions may morph over time, it is important to have an idea of where you are going with the concept to create the right infrastructure.

Virtual Collaboration

One of the trends in the questions above has to do with the team. With whom are you going to work?

Virtual firm models create unique opportunities to collaborate with other lawyers on a broader scale than may be otherwise possible in a traditional bricks-and-mortar setting. Adding lawyers in the traditional sense requires the analysis of whether there is enough real estate and whether staff has to be added. Virtual models take a lot of these issues off the table. Being able to scale up by adding team members and plugging them into the tech ecosystem creates interesting opportunities to collaborate with lawyers across jurisdictions based on subject matter and expertise while worrying less about where you are going to “put them.” (Obviously, one must keep an eye on how this is executed to avoid the unauthorized practice of law.)

Plus, many lawyers are solos because they like working on their own, outside the traditional firm world. The hybrid approach of working in a virtual setting gives lawyers the best of both worlds: the ability to work with others without being in the enclosed office environment on a regular basis. Plus, it is fair to say that if lawyers are engaging in a virtual firm model, then they are probably likeminded and forward thinking. There will be less distraction from conflict between those lawyers who are comfortable where things are and those who want to advance forward—everyone drawn to such settings wants to move forward.

The Technology to Make This Happen

The discussion of technology in this article has purposely been placed near the end. As mentioned above, technology is important for virtual firms, clearly. However, leading with the technology platform and building a law firm around it is backward. The people involved in the firm must figure out the culture, practice areas, client types, etc., and then analyze which platform is right for their situation.

Below are four areas to consider implementing when developing a virtual model. (Note: The platforms discussed below are those used by the author. There are others out there; check out ABA resources, attend ABA TECHSHOW, or use the Internet to find them.)

Practice management solutions. Regardless of the size of the firm, a cloud-based practice management solution is necessary to run a virtual firm effectively. This includes time and billing, calendars, contacts, reporting, and bank account management tasks, among others. For example, Clio (goclio.com) is such a solution. Clio is cloud-based, so the data can be accessed from anywhere on the Internet in a secure environment. Clio also has an iPhone app to meaningfully interact with the platform. There is a strong trend toward mobility in technology platforms, and this is a good example. The platform also easily scales to add users when the firm is poised to grow.

Document management. It would be an understatement to say that documents are important for a law practice. Having them accessible from anywhere in a paperless work environment is a core technology tenet of a virtual firm. Having a paper-filled office is inconsistent with being mobile and being able to share information online. Fundamentally, relying on paper is antithetical to the concept of the virtual firm.

Box (box.com) is an enterprise content management solution that can house documents of all file types. Again, there is a focus on mobility to access these documents anywhere. Lawyers can pull documents off a mobile device in court if a certain subject matter is at issue or while sitting in a client’s office discussing a matter.

Online delivery. One of the traditional characteristics of a virtual law firm is having a secure client portal to interact and share information. This includes directly delivering services online through platforms such as DirectLaw (directlaw.com). DirectLaw allows the consumer to explore and purchase documents through a law firm’s website by filling out tailored questionnaires online. This data is then populated automatically into documents (whether forms provided by DirectLaw or customized documents from the firm), allowing the lawyer to review the documents, have follow-up conversations with the client, and provide final documents that the client can execute him- or herself. This is a prime example of going where consumers currently are seeking legal services and where they will likely seek these services in the future. This model combines the legal knowledge and delivery of services with technology in a direct and meaningful way.

Social engagement. The idea of having a virtual or distributed team means that face-to-face interactions are not going to occur as often as in a traditional firm model. Still, interaction and engagement in a collaborative environment are important. This is where tools such as Yammer (yammer.com) come into play. Yammer is an enterprise social network—sort of a Facebook just for your law firm. It has news feeds and private messaging. Yammer can be used for everything from watercooler talk to event planning to other information sharing within the firm. It helps reduce excess e-mail and focuses the interactions in a format that most of the world is used to: social media.

Integration. Although each of these platforms can be used individually within firms, they all integrate with each other as well to share data and increase efficiency. In fact, the usability and relevance of each platform increases the more it is integrated with the others. Such integration reflects where the cloud is moving technology and collaboration.

Bringing It Home

The virtual law firm creates a different environment for delivering legal services. By definition, it causes lawyers to think differently about client service. The creativity that is included in such an endeavor keeps the mind working to further enhance and make sure that the firm is keeping an eye to the future, as opposed to living in the past. In the coming years, it may well be that such firms will not be labeled as “virtual” at all; they will simply be considered to engage in the practice of law.

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