Business-Minded Don'ts and Dos for Law Firms

Some lawyers still insist that law is a "profession" and not a "business," an attitude that is ingrained in legal training. They fail to understand the operation of the firm as a business with a budget, collections, profit and loss.

Not surprisingly, that kind of thinking leads to the failure of too many firms. But the concepts of law and business are not mutually exclusive. Lawyers who can link the two concepts will better assess the value they provide and create new ways to provide more of it.

Here are a half dozen of the most important dos and don'ts — or, more to the point, don'ts that require corresponding dos — for businesslike conduct in client relations.

1. Don't put the firm first. Do put the client first.

   Amid all the communications between attorneys and clients, lawyers often fail to ask the most essential question: "How am I doing?" Admittedly, it may open a dialogue that is difficult, but it should be part of any lawyer's skill set. Attorneys are skilled at communicating with judges, juries, partners and peers. Communicate to your clients about their worth and you'll have a better chance of retaining them.

2. Don't just take whatever work is available. Do target your clients.

   Successful marketing can only be approached practically with a narrow focus that creates a profile of your ideal client and develops a strategy for communicating your services and capabilities to that target, not everyone. A business that tries to grow without a clear idea of where it wants to grow will soon find itself floundering.

3. Don't worry about keeping your options wide open. Do have a budget.

   Lawyers may reject budgeting because they believe that providing their services depends on too many unanticipated variables, or they don't want their quality of services to be constrained by budget limitations. But budgets define successful business planning, and any firm can and should operate according to one that's approved and accepted by the client.

4. Don't assume clients know what you do. Do constantly communicate and inform.

   It's essential that the client knows what the lawyer is doing and that the client approves of the tactics to be taken to achieve the client's strategy/goal. The lawyer can only provide services successfully by understanding the intent and desires and wants of the client. Attorneys must communicate with clients at their level of understanding — and do so frequently.

5. Don't view technology as a cost threat. Do use it as an investment and way to give clients more value.

   Law firms should partner with their clients and show them how they use technology to reduce their legal costs by reducing the amount of necessary labor (but without needing to reduce the lawyers' per unit fees). Don't be too quick to dismiss a new technology that may seem too "techy" or unnecessary. When we first heard about the "cloud," didn't it conjure up images more mythical than utilitarian? And tablets were once seen as superfluous way stations between phones and laptops.

6. Don't be a bank for your clients. Do emphasize collections.

   Law firms should not be lending institutions that carry their clients' expenses. Stipulating payment rates and terms in the engagement agreement and then enforcing them is the best way to get paid. If the client hasn't paid the fee while your firm continues to work on and bill for the matter, you are extending a no-cost loan to the client — the ultimate lapse in businesslike conduct.