Are you thinking like a lawyer or a law business owner? Here’s a quick litmus test:
Do your daily thoughts revolve around getting Income or ROI?
Most lawyers are not even sure what ROI is, let alone how to focus on it. In a nutshell, ROI or return on investment means that you:
“Never spend a dollar unless you can make or save MORE than a dollar.”
It’s that simple.
Getting income is crucial. Never take your eye off that ball. But do take a moment to examine your strategies for getting additional income because you might find you’ve been focusing in the wrong place. You’ll be glad you did.
The primary challenge you face when you’re focused on getting income is that you can only sell so much of your time.
Return on Investment means you’re leveraging systems, people and money (or, ideally other people’s money) to generate more cash than you could on your own.
How can you make the shift from merely getting income to getting ROI?
Let’s say you’re billing at a reasonable $300/hr. Each hour of your time is a unit of inventory. The only way for you to make more money is to sell more inventory, and there are only so many hours available to sell. If you are chief, cook and bottle-washer in your practice, you have even less billable hours in your inventory because you have to do work that doesn’t pay $300/hr.
1.) Replace yourself – Learn to Leverage Other People’s Time
Hiring assistants at $15, $30, even $60 or $100 per hour to free up more of your $300/hr inventory is a no brainer. Just do the math:
ROI on a $30/hr assistant is easy to calculate: ($300 – $30)/$30 = 9 or 900%
Yes, you read that right, you’re getting a 9x return on your dollars invested. In today’s weak market, you quickly begin to see that your practice really is your best investment.
Granted, hiring and training take time.
Also, there will be hours your staff gets paid while you’re out of the office (enjoying lunch, seeing your child’s school performance, studying marketing and sales, working ON your business, getting coached, days off, etc…) but in this basic example, you can see the ROI is juicy.
In fact, an assistant who handles your marketing, client services and more is so affordable you’d be crazy NOT to hire (so long as you can quickly and efficiently train that assistant well.)
With the S&P 500 averaging 13.5% returns, even if your investment in hiring and training staff yields you a mere 100% or even 50% ROI (instead of the 900% in my example), hiring is still the smartest investment you can make.
And the fastest way to get ROI from your hiring investment is to hire and train a team member to focus on getting you in front of a steady stream of new clients, and then turning them into raving fans.
Don’t worry if you have no idea how to actually do that, we’ve got answers. Here’s a call you can register for now that lays out the specifics of how to find and train a law practice assistant to find you prospects, follow up with leads and turn your clients into raving fans.
In part two of this article, I’ll talk about leveraging other people’s systems so you don’t have to reinvent the wheel figuring out how to market effectively, hire effectively, train effectively, manage effectively…
Stay tuned for part two next week, where I’ll share more powerful shifts you can easily make to take you from income-mentality to ROI mindset.