Remember that class you took in your second semester of law school…
The one where you carefully laid out your vision for how your law practice would look, feel, function and flow cash from one month to the next?
You didn’t have that class. You learned how to “lawyer” in law school.
Running a law practice is an entirely different skill set, and it begins with admitting that there are things you don’t know.
“Failure to plan, is planning to fail.”
Fortunately, these things are knowable, and the best part is, you can make many of the answers up. Just pull them from your mind and make sure they pass Jim Collin’s Hedgehog test. (You can read my article about that, here.)
Before we get into the elements of a healthy business plan — which can be simpler than you imagine — let’s go over why you’d even want a written plan in the first place.
Why Every Law Firm Needs An Up-To-Date Plan
1.) Inspiration — If your plan doesn’t inspire you, then rip it up and start over. There’s no point putting yourself through decades of stress and strain trying to do something your heart is only half in. That’s what will happen if you aren’t in love with your business plan — you’ll hold back, and it will show.
Remember the three circles of your Hedgehog: Passion, Mastery and Economic Upside… it’s hard to get inspired about slaving away helping people who don’t appreciate you, or doing work that’s been commoditized to cut-throat prices, so be sure to include a healthy upside in your plan by positioning yourself as an expert with premium services.
2.) Focus — The leaders job is knowing what to say ‘No’ to. There will always be more opportunities than you can handle once you start seeing some success. Your job is to keep your eyes on the prize. Stay focused on your Hedgehog strategy, and trust that saying ‘No’ to bright shiny objects that glisten all around you is your strongest way of saying YES to the durable, long-term success of your firm. When in doubt, throw it out. Nobody ever became the most successful ‘door lawyer’ in town.
Your plan not only keeps you focused, but your team as well. By sharing your written plan with each new member of your team (even before you hire them), they will understand where you’re going, and if this is the bus they want to get on. When they do join up, they’ll be enthused and clear on their seat and their role to play in getting you there.
If you’ve ever made a list, you know there’s something powerful about writing out your plan — ideally printing it out and posting it somewhere you can review regularly — that solidifies and focuses the vision in your mind. Think of an architect. They map it out so it’s clear to everyone. Otherwise, they’d be very limited in terms of the size of structure they could effectively build.
3.) Leverage — At a certain point in your growth, you’ll absolutely want to consider leveraging debt to accelerate and get to the next level. Having an inspiring, focused vision lets your investors — be they family, friends, banks or partners — know you’re serious. It gives them something to get excited about.
Doing your homework and creating a thoughtful plan can be your single greatest leverage point for growing your firm.
There’s your starting point. Go forth and get moving. In my next post, I’ll talk about the elements of an effective business plan.
Want to learn more about how to run your law practice like a business and see higher success rates?