Perhaps never more apparent than during an economic, technological or health crisis, owners of firms benefit hugely from the leadership of a nonlawyer administrator. Lawyers as trusted advisors must tend more intentionally to the care and feeding of client emergencies during a widespread crisis or risk being replaced: The unresponsive attorney is an unpardonable sin.
Even during normal operating conditions, however, lead administrators offer necessary cohesion and a more neutral voice among lawyers, staff, vendors and clients. It’s no surprise that good clients are willing to pay top dollar for proactive, personalized legal services that can only exist through the deep focus of an experienced attorney anticipating their current and future legal challenges. What is surprising is lawyers’ insistence on moonlighting as the business guru for their firm, while attempting to render top-shelf legal advice in their day job.
In short, attorneys must take off their lawyer hat to effectively run a business. Economic, human capital, business development and technology functions of law practices simply don’t lend themselves to such cognitive biases as:
- A motion to adjourn final decisions is always in order.
- Righteous selection of information is that which proves one’s pre-existing hypotheses.
- The firm across the street did it first.
- Control of the business outcome exists because truth is interpretive.
What Does An Administrator Do For Me?
In their primary role, legal management professionals enable attorneys to spend more time practicing law (billable hours) rather than managing multiple facets of the practice (non-billable time). Following are nine more ways a nonlawyer administrator helps ease the attorney’s non-billable load.
Accounting and financial management.
Such business knowledge includes generally accepted accounting principles, tax regulations, financial management and reporting, collection and billing procedures. Depending on your practice, this may or may not include bookkeeping responsibilities, and the administrator should implement solid internal financial controls to prevent fraudulent activity before it begins.
Law business matters.
Administrators offer necessary accountability when they are empowered to act independently for the good of the practice (as opposed to any one equity holder). Law firms are a different animal and require strict professional responsibility on behalf of clients, and administrators can be invaluable when confronting data security, disaster recovery and conflicts of interest.
Since law practices are a professional service, human resources management is a critically important component of any firm’s overall business success. Leo Rosten, an American social scientist, said that first-rate people recruit other first-rate people; second-rate people recruit third-rate people. I’ll add that third-rate people recruit fifth-rate people. In addition to mission-critical recruiting and onboarding, administrators must stay on top of changing employment laws and the day-to-day minutia of hiring, training, compensation, evaluations and discipline and discharge.
Following salaries and perhaps rent, fringe benefits are a significant portion of a firm’s operating expense. For this reason, administrators oversee these important benefits requiring close attention to create a differentiating compensation package.
Every employee at your firm drives revenue, not just client managers and timekeepers. An administrator can be a force multiplier when encouraged to serve as a face of the firm in the business community contributing directly to new business development.
Strategic planning and succession.
Lawyers can often be too close to their practice, which affords their livelihood, to unbiasedly gauge new opportunities as well as upcoming challenges. Administrators can facilitate both policy development and business strategy implementation plans, as well as business succession issues, all without equivalent skin in the game.
Any practice has a brand and reputation that, much like technology, requires care and feeding. Administrators can carry some of this burden, managing everything from outsourced advertising to website design.
Technology and project management.
Rapid advancements in technology point to a strong need for administrators who are computer literate, and not intimidated by technical terms related to systems, software, hardware and peripherals. In addition to diagnosing tech issues, the administrator oversees the management of your firm’s equipment and systems.
Leadership and negotiation.
I estimate that small and midsize law practices have at least 25 existing vendor relationships and some perhaps as many as 70. While the lead lawyer of your practice should review all contracts, or at least those where payment terms exceed $10,000 in a given year, managing the purchase and delivery of office supplies, food and beverages and the mail entail a massive drain on billable hours. An administrator with excellent written and oral communication skills can deftly handle competing interests as well as negotiate favorable terms for your practice.
Empowerment Is The Key
Before hiring a professional administrator in your practice, ensure that your lawyers are willing to relinquish day-to-day operational responsibilities and that the firm’s culture supports such a position. Nobody relishes a job where they are unwanted on day one. Further, your administrator will absolutely come with some weaknesses to complement their comfortable strengths in these nine areas: Locate your threshold to accommodate them.
Still, being definitive and willing to risk failure is far better than decision paralysis and continued crushing amounts of non-billable time. Empower your administrator to effectively support your practice and then back her up when mistakes are made and the vultures circle. If your experience is anything like mine, practice some heartfelt apologies and test your sword-falling skills. Leading people often means learning to fail forward.