Why Systems are So Important To Your Law Practice

My Wife and I are currently under contract to buy a house and we close later this month. Earlier this week I had to drop off a due diligence check to the realtor. It was close to closing time at the realtor’s office and the front desk person was new.

As I was standing at the front desk waiting for them to give me a receipt and copy of the check, I noticed that the girl at the front desk was working off a checklist in a binder entitled “front desk training manual”. The checklist she was working off of was titled “end of day closing checklist” and it had probably 10-12 things that she needed to do, each and every day, to shut down the office.

One of the items was to close the blinds for the window in the reception area.

I got a little chuckle as I thought to myself, “I wonder how many businesses would just tell the staff person to remember to close the blinds at the end of the day and then open them in the morning?” Probably most.

That’s a system. And that’s the difference between running a successful and growing business and just skating by with a solo practice.

The Importance of Systems in Your Law Practice

If you are a student of legal marketing like I am, then you probably already know how important systems are to the growth and sustainability of your law practice.

I first learned about the power of systems back in 2005 or 2006 when I was told by another, much more successful lawyer, to read the “E-Myth” by Michael Gerber.

One of the most well-known examples of how powerful systems can be is the McDonalds franchise. Honestly, any business that can get some 16-year-old kid to do the same job and create the exact same product as some other 16-year-old kid halfway around the world is bound to be successful.

The systems that McDonald’s has developed are thorough, complete and simple to understand and follow. They have a system for everything from how to make fries to what to to do when someone doesn’t show up for work.

Which leads me to the point of this blog post, if you haven’t already figured it out.

You need systems in your law practice.

I know what you are thinking: “Great, thanks for the insight Jim. We already knew that.”

I’ll be honest with you, this advice is not novel. Pretty much every legal marketing guru out there will tell you the same thing. If you want to build and grow your law practice you absolutely, positively, MUST have systems in place. You just can’t do it any other way.

Why You Must Develop and Implement Systems in Your Law Practice

If you are trying to resist the idea that you need systems… don’t. Just don’t.

Here’s the deal. You are one person. In any given working day, you can only do so much work. You only have so many hours in the day.

Let’s say you decide to start up a law practice, or maybe you already have. You are doing a good job marketing and developing some new business, but have decided that you are going to do everything yourself.

(Spoiler alert, this was me for the past couple years while I was trying to find a niche for my law practice).

For some people, this approach works just fine because they are practicing law part-time, or just taking on a small number of clients for some extra cash while their spouse earns a salary to support their family. Other lawyers that fall into this grouping are older, nearing retirement and trying to slow down. They aren’t looking to grow, they just enjoy the work.

If you find yourself in one of those two situations, then you can stop reading right now and get back to doing what you love – practicing law.

But for the rest of you who are looking to take your practice to another level, this information is vitally important.

Back to where I was a couple of years ago after I fired my legal assistant and decided to “slow things down” while I figured out what I wanted to do with my practice.

First off, things didn’t completely slow down. Cases still came in the door and clients still paid me.

But because I was doing hourly work, the amount of money I could earn was limited by the number of hours I could bill in a day. Let’s say I could bill 4 hours per day (a stretch), while still handling all the administrative tasks that come with running a law firm.

There are 365 days in a year. If you subtract out 104 days for weekends and 10 holidays you get approximately 250 billable days that you can work per year. This doesn’t include vacation because as a solo you can’t afford to take a vacation.

At the time I was billing out approximately $285 per hour. So $285 times 4 times 250 equals a gross income of $285,000 per year.

Now let me ask you a question – is your law firm grossing $285,000 per year?

Let’s not forget about expenses.

You can run a law firm on a pretty tight budget, but at a minimum, you will probably spend $2,000 to $3,000 per month on expenses related to your law practice. Conservatively speaking, that’s $36,000 per year that is going out the door. And that probably doesn’t include health insurance which is ridiculously expensive right now, but that’s another topic for another day.

So net income to you is approximately $250,000 per year, before taxes.

Not a bad living, huh?

Except for the fact that you haven’t taken any vacations, you are probably working your ass off 10-12 hours per day and I dare you to remember a weekend that you haven’t worked because there is always something you need to do.

How do I know this? Because that was me, and 1) my firm wasn’t even grossing $285,000 per year, and 2) my expenses always seemed to be much more than $36,000.

Was I making a nice, six-figure income? Yes.

Was I slowly killing myself in the process. Also yes.

This is why systems are so important.

Law Firm Systems Will Set You Free

In January of this year, I bit the bullet and hired a legal assistant. Not a paralegal – a legal assistant.

Her job is not to do legal work, but rather to handle and manage all the administrative, $10/hour crap work that I don’t want to do. She manages my calendar, answers the phone, keeps my case management system up to date, etc.

It’s already made a huge difference in my life and the way I approach the work I do both in and ON my law firm.

(It’s also one of the main reasons I was able to restart this blog)!

We’ve started to build out systems for how we do everything from handle the mail, to answer the phones, to opening or closing files.

It’s a slow process because we are both learning on the fly about how best to do training and make sure everything she does is systematized.

But honestly, it was the best decision I will make in 2018, and I encourage you to do the same.

Start small. Write out a procedure for how you answer the phones in your office and how you open a new file.

Do one procedure a day. When you have 10-20 new procedures, make up a job description and place an ad for a legal assistant or paralegal. You are worth anywhere from $250-350 per hour to your firm – don’t waste that time doing $10/hour work.

Do some interviews and hire someone.

You won’t regret it.

In six months you will be able to take more time off knowing that stuff is still getting done in your office even if you aren’t there.

Good luck – you can thank me later.

Have you joined our Facebook Group? It’s a completely free group of marketing-minded lawyers to share information and ask questions of. Click here to request access.

Post a Comment

Your email address will not be published. Required fields are marked *