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There are a lot of small and mid-sized law firms that rely on relatively few clients.  These client relationships are typically consolidated among an even smaller subset of top performing lawyers. It is not unusual for us to  encounter a firm of twenty lawyers serving less than 20 or 30 clients that are managed by three or four partners. We have also worked with firms of more than 50 lawyers working for 6 or 7…
With an estimated 65% of equity partners approaching retirement age over the next decade, most attorneys currently working in a law firm will be affected by the challenge of transition planning. While this statistic is notable, most law firms pay little attention to partners’ plans for retirement. Without careful planning, the investment and hard work you have put into your firm could end up benefiting your competitors. In this post, we review 10 key steps…
The topic of transition planning is not the most enjoyable or easy topic around law firms. But it is critical, especially with a significant number of equity partners set to retire over the next decade. So why is transition planning so difficult for law firms? The list of challenges to transition planning is a long one. Our eBook “Is It Possible to Transition a Small Law Firm” highlights 12 of the most significant ones we…
While the practice of law continues to undergo many changes, one thing will not change. Law firms will always need energy, experience and skill to survive. Smart firms understand that developing this type of firm starts with actually hiring the right attorneys.  And it continues with effective training, evaluation programs and compensation. Law firms with strong associate development programs will develop and retain their leaders and will be better positioned to handle future challenges.  …
Besides experience and skill, associate, staff, and even income partner performance are a reflection of the law firm’s management effectiveness. Attorney and staff performance are based on a variety of legal and non-legal activities, which can be described as behaviors that require motivation.  Such motivation can be categorized as extrinsic or intrinsic, both of which should be fostered by the firm’s leadership style. While incentives like compensation and bonuses are obvious management tools to drive…
In determining attorney compensation,  bonus considerations can be either subjective or objective in nature.   Subjective bonuses should be considered when intangible value is created or the achievement is not economically measurable. Typical areas of work that fall under this bonus category are: Quality of professional work Work ethic Client relations and service Personal development Business development competence Professional recognition Training contributions Adding to the reputation of the firm Such awards are not tied to…
Compensation issues are a main reason that clients and prospective clients contact us. Our clients view business generation as a means of survival and want to reward heavily for it.  The partners who make up our client law firms understand the transient nature of client relationships and want to realize a high return for their efforts during periods of success. Many partners took considerable risks to create new opportunities and expect fair compensation to parallel…
  Marketing is necessary for the longevity of a legal practice. A structured marketing plan will steer lawyers in the right direction of targeted clients and will make sure any time and money invested in marketing is well spent. In developing the actual plan, lawyers must consider the impact of various factors such as:  the firm’s priorities regarding workload increases, client types and billing arrangements; funding and marketing support availability; and the timeframe for the…
Setting and adjusting base salaries requires law firms to consider many factors. While initial base salaries for lawyers are often driven by external market factors, we encourage law firms to consider qualitative factors such as work quality, work ethic, and client service when determining the capability and progression of their lawyers. To ensure that a law firm develops a market-competitive and fair compensation system that rewards the firm’s valued behaviors, we recommend a balanced approach.…
When should attorneys receive a bonus? And when does a salary increase make more sense?  From our view, bonus payments represent compensation for contributions that are not necessarily repeatable.  For example, an attorney worked on a large case and generated significant income for the firm. Unless the attorney became more marketable in the process, the current year financial results might not repeat. Without producing the same results in the future, the higher base salary would…