June 2001
by Edward Poll, J.D., M.B.A., CMC
Ancillary profit centers are the wave of the future, and an effective way for law firms to get off the slavery of the billable hour. This was the point made at the most interesting program yesterday at the ALA national conference, here in Baltimore.
Carl Barba, Jr., the executive director and CFO of Nutterman McClennen & Fish in Boston, said that their ancillary business provided a "significant" portion of the partner's profits each year. They have a big trusts & estates practice at the firm, which creates a lot of trusts for clients. The three ancillary businesses handle accounting, tax returns and money management for those trusts.
Lots of firms are starting ancillary businesses. Marilyn Mickelson, Executive Director at Collier Shannon Scott in DC, listed 15 well-known law firms that have ancillary business that offer technology, marketing, investigation, ADR and other services for clients.
Marvin Chavis of Womble Carlyle said that the ancillary businesses will actually help lawyers reduce the hours they need to bill, even though revenues is not the No.1 problem in law firms. He said that the top problems in law firms is lawyer dissatisfaction -- the vast majority of associates quit within 3 years. He said that law firms need to give lawyers time to have a personal life, which means getting off the billable hour treadmill.
Very interesting program overall.
Larry Bodine, LawMarketing Operator, http://www.LawMarketing.com
