For so many lawyers, having their own law firm is a dream. Many lawyers reach that point only to learn how much more challenging it can be to run a successful law firm — and let’s be honest, nobody sets out to own and manage an unsuccessful firm.
Here at CosmoLex, we work many different firms throughout North America, and while we pride ourselves on helping those firm’s become successful, we also pick up some great tips, tricks, and habits from those firms along the way.
Through our work and experience, we have compiled a list of seven habits that we see the most successful firms practicing on a regular basis. Here is that list.
7 Habits of Successful Law Firms
- Even the Smallest Detail Has a Place In The Big Picture- If you’re managing a firm, it’s likely that you have your eyes set on the big goals, but successful managers know how to keep an eye on even the smallest details. A great way for an attorney at the partner or management level to keep a full understanding of everything is to utilize tools that are most likely already in place to keep an eye on all of the smaller, daily details: practice management data dashboards, bank data feeds, and software user permissions. Tools such as these can give insight into billing status, account activity, and user actions, all vital stats that are often overlooked
- Clean Up Data Entry by Only Doing It Once- All too often firms separate practice management, billing, and business accounting into no less than two different systems, even though they all require the same data. Keeping these different systems in sync can create a massive challenge. Successful firms integrate these different systems into one so that data only needs to be entered or edited once. This reduces data entry errors and makes it easier to track down errors that have already occurred as they are all in one system.
- Understand Which Practice Areas Produce the Best Return- This habit really differentiates firms that are business savvy from those that are not. Like any business that has multiple products or services law firms need to understand which practice areas are the most profitable. This allows them to make better use of their time and marketing dollars.
- Understand Productivity- Successful firms need to understand productivity of their firm. This helps them to understand how different members, or even outside partners should be compensated for the work they carry out on behalf of the firm. In addition to this, it can also help firms to understand which practice areas are more profitable than others, as mentioned above.
- Keep Money in The Firm’s Hands- The best law firms deserve to get paid, so it is important that firms make it as easy as possible for their clients to pay them. For law firms, this means accepting credit cards and being able to process large deposits through a legal-specific credit card processing vendor, such as LawPay.
In addition to making it easy for clients to pay your law firm, it’s equally as important to reduce and avoid leakage by ensuring everything is billed at the time of expense and all overhead costs are always accounted for.
- Make Compliance a Priority ALL THE TIME- Chances are you and your firm are already familiar with IOLTA or trust accounting. You probably understand how much of a headache it can be trying to remain compliant with the regulations associated with it. Many firms will depend on account reconciliations one a month or even every 6 months to ensure their compliance, but it is best to always have your accounts reconciled and IOLTA compliant because you never know when a legal accounting audit may rear its ugly head.
- You’re Not Just a Lawyer, You’re a Business Person- The final habit is simple. Once you put up a shingle and create your own practice you need to understand that you are no longer just an attorney, you’re now a super-hybrid business person/attorney and there are many new challenges that come with it. Your reputation will go beyond what you do in the courtroom and now include how your business operates. Build your firm up with the right infrastructure and technology to simplify your day to day operations, so you can spend less time worrying about the management of your business and more time practicing law for your clients.
If you’re looking to learn more about these habits or see how CosmoLex can help you adopt them in your law firm, visit our 7 Habits of Successful Law Firms Resource Center for more information.