You Decide What Counts
It was the early 1970s and the answer to increasing law firm profitability had been found: Keep track of the time spent on client tasks and bill accordingly. Toss those fee schedules. An ABA study tested and confirmed the theory. Case closed.
By 1980, new answers were sought. The pyramid structure, providing leverage for shareholders’ pockets through staffed-up lower ranks, became the next true way to increase profits.
But by the 1990s, it seemed clear the pyramid wasn’t always the answer. The next hot business strategy for law firms appeared: merging. Bigger had to be better. Once again, a single strategy was revered as the ultimate solution to business management challenges. Troubled and acquisition-hungry firms alike sought an easy answer: a gullible merger partner.
We’ve seen plenty of other trends along the way. Print a brochure. Beef up on paralegals. Brand your firm. Do what the other firms do.
There. I’ve said it: Do what the other firms do.
The unfortunate truth about law firm management trends is that they are just that—trends, built on the all-too-familiar ground of precedent-based decision making. We’re talking lemming-like thinking about the most fundamental and critical of business questions! Is charging for your work based on an hourly rate a good idea? You bet, for some firms. What about the pyramid? Ditto. Some practices lend themselves to hoards of busy worker bees. Others, personal tax counseling, for example, do not. And aren’t there irrefutable success stories to be told on the merger front? Yes, along with some dismal tales of failures.
This issue of Law Practice Management is dedicated to considering and devising strategic options in the context of your firm, your market, your people and your individual measures for success. Ed Wesemann investigates strategic alliances and joint ventures. Ward Bower helps you decide whether to pursue a merger. And Steve Taylor tells the success stories behind five midsize firms that steadfastly choose not to merge.
No single business strategy is right for every firm. Not every business metric is an appropriate measure of success for all. (As inviting as the AmLaw "profits per partner" measure may be, it doesn’t measure success from everyone’s point of view.)
It can be tempting to borrow other firms’ strategies. But in the final analysis, only you can decide what counts for your success—be it money, integrity, quality, adventure, balance, happiness or a combination of factors. This is something you have to figure out for yourself. Consider that your road to success might just be that road less traveled.
Merrilyn Astin Tarlton, email@example.com
P.S. Don’t miss Fresh Out, on page 43, our brand-new column written by Susan Saltonstall Duncan. Be sure to send it on to your favorite young lawyers.