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"I Guarantee It"
One of my bedrock beliefs is that lawyers should charge for the value of the services they provide, and not at an hourly rate like a day laborer. My billing for consulting and coaching is totally flat fee and project based. I started billing this way when I founded LawBiz® Management Company in 1990. I wanted to bill, not for the amount of time I worked, but for the value I provided to my clients. Part of my approach is that, once I negotiate the fee for a client engagement, I give up the power of the pen. In other words, once I send my bill to a client, any dissatisfaction on the client's part is reason enough for them to write down the amount that I bill to what they think it's worth. The opportunity for them to exercise the power of the pen is always there.
Apply this principle to the current enthusiasm for alternative billing. Alternative fee arrangements when tied to a specific result are really a form of guarantee. Contingency, flat or fixed fees all do this; so too does premium pricing which confers the right to an additional amount beyond a stated fee if the result exceeds client expectations as defined in the agreement. Such billing alternatives again require the kind of solid knowledge on a firm's cost structure that supports taking a direct financial stake in achieving the desired results.
It's only a short step from this level to the "satisfaction guaranteed" approach some firms have taken. Chicago's Ungaretti & Harris has for well over a decade assured clients: "We cannot guarantee outcomes; we do guarantee your satisfaction with our service. If we do not perform to your satisfaction, inform us promptly. We will resolve the issue to your satisfaction, even if it means reducing your legal fees." The Summit Law Group, based in Seattle, offers a variation by providing clients with its "value adjustment line" on invoices: "We empower each of our customers with the right to adjust our billing, upward or downward, based on our customer's perception of the value received, not ours."
Rule of Professional Conduct 7.1 prohibits false or misleading communication that could "lead a reasonable person to form an unjustified expectation" about results. However, lawyers and law firms can guarantee a certain degree of effort - which does not violate the code, because it deals with factors within the lawyer's own control. In this way, a firm can give the kind of assurance on the value and quality of their services that clients want and expect.
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Following the worst economic crisis since the Great
Depression, and facing a sea change in clients' demands
and expectations, law firms must respond and adapt
quickly and effectively. Law firms must choose the kind of
law practice they will be; the marketing and business
development tactics they will use; the overhead that is
critical to their functioning; how to price, bill and collect
for services; and how to manage the cash flow cycle.
Success lies in identifying and capturing the right kinds of
clients, providing the services those clients need in ways
that add value, and ensuring prompt payment and the
ability to grow profits. This book, based on the
experiences of Ed and his clients over 20 years of
coaching and consulting, provides the keys to
successfully thriving in the new era.
Available for Pre-Sale
Ships in February 2010
Pre-Sale Price: $99
Regular Price: $120
Call or Order Online at:
1-800-837-5880
www.lawbiz.com
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Personal Commentary
One of the best results of working with a coach is that you become
accountable to someone for your agreed and accepted assignments. I have
believed so much in the value of this process that I have had a mentor/coach
for a number of years. Recently, I've taken to noting my accomplishments and
setbacks on a daily basis and then send them to my coach at the end of the
week. And he'll respond with his reaction and observation to provide
additional feedback.
I've found that the mere fact of noting these events in writing, sort of as
a personal journal, or journey on my career path, has the beneficial impact
of highlighting and reinforcing the good things that have been happening to
me. We tend to forget the good and fuss over the bad. This process allows me
to relish in the good and put the bad into its proper perspective.
Let your coach know how you're doing. The salutary impact for you will be magnified.
Best wishes,
Ed Poll
lawbiz.com
lawbizblog.com
www.LawBizForum.com
800-837-5880
Please use the URL below to link to this issue:
www.lawbiz.com/nlimages/tip-2-16-10.html
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What Readers Are Saying...
"No matter how you slice it, there is
no substitute for wisdom and
experience. Ed Poll has
demonstrated both in this eyeopening
book about the essential
elements of running a profitable law
practice. He provides practical
wisdom along with simple ways to
adopt and incorporate best practices
for each. After explaining the pros
and cons of every decision, he makes
recommendations and provides
useful guides disguised as key
principles. Buy the book so you too
can access Ed's wisdom and
experience. It's worth much more
than the investment."
STEWART L. LEVINE. ESQ.,
FOUNDER, RESOLUTIONWORKS
AUTHOR, GETTING TO RESOLUTION;
THE BOOK OF AGREEMENT AND
COLLABORATION 2.0
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