Running Your Legal Firm as an Efficient Business

Estimated reading time: 6 minutes

It’s possible to simultaneously be good at practicing law and running a business.

While you’re probably thinking “I know that”, it still requires laying it out there in print. Even though it’s an obvious observation, many small law firms and independent lawyers act like there is a choice between the two.

And there are multiple reasons for this false dichotomy:

Time: Court appointments, document prep, meeting with new clients are all time-based operations. Focusing on the efficiency of the business often takes a backseat to the everyday workings of being a legal professional.
People: Following up, setting agendas and counting on people. Managing individuals on your team (paralegals, virtual assistants and others) is a difficult task — but totally worth it when done correctly.
Tools: Lawyers commonly use tools. Things like document storage, data tools and practice management solutions, to keep track of their cases and research. But there are other tools most are less familiar with (accounting software and investigative research solutions, for example).

If one or more of these three things inhibit your practice, it’s time to work on improvements.

Efficient firms have a plan (and a goal)

Making the most of time spent requires proper planning. Sure, you plan your day or week without having a set “goal”. But efficiency is always easier to achieve with a solid target in your organization.

What is it you’d like to achieve?

More clients or billable hours?
Take on another lawyer and build out the firm?
Keep the same client level with fewer hours in the office?
Something else?

Think about it. Figure out your goal. It’s step one. After everyone knows the target, the plan is a bit easier to figure out.

Plan to meet the goal

Goals need a plan. And great plans have waypoints. Think of waypoints as a few metrics showing whether or not the goal is becoming a reality. From there, individual tasks are set to move the needle in those waypoints — moving you toward the goal.

Here’s an example situation to better explain.

Example goal: You want to increase the number of clients you represent in a given quarter. Typically, you are able to handle about 8 clients. An increase to 10 represents 20% growth — not bad.

Example waypoint: In order to get more clients, you need more leads. So, the number of potential leads coming in each quarter is our waypoint.

Here’s the math.

Currently, your firm gets around 40 leads each quarter. As determined, this equals about 8 clients in the same period. So, 20% of the leads in your firm become clients. Increase leads by 10 each quarter and it’s statistically likely you’ll reach the 10 clients by next quarter.

Example tasks:

Attend more networking events.
Send emails to current/previous clients asking for referrals.
Expand services to attract different clients.

To reiterate; the tasks improve your waypoint metrics (increasing the number of leads) in order to achieve your goal (10 clients/quarter).

Takeaway action: Determine your goals, set waypoints and determine tasks. Then, check on your waypoints as a way of seeing how close you are to each goal you set.

Efficient firms delegate (and trust)

Meeting your business goals often means expanding your team. Hiring paralegals, assistants and even other lawyers are all part of growing firms. For each person hired — you’re the one training and managing them.

At least at first.

This makes the “people piece” of the business a big hurdle for small legal operations. In general, distrust is the likely culprit. Either you don’t trust yourself to be as engaged and necessary, or you don’t trust someone else with your set processes.

Both of these problems often have the same solution.

While it’s impossible to parse through the best management practices in a single article, there are two steps to getting started in the realm of delegation — clear expectations and regular follow up.

1. Set clear expectations

You may have people already working with you. Even still, it’s a great idea to sit down and think about the functions everyone on your team is expected to perform. Outline each and every task given and the expected outcome from all of them.

Thinking these things through and writing them down helps you and those current/future employees. For you, it provides the needed information for training. You know how you like documents prepared, so that’s something that needs to pass on to the team.

And for the team, it gives clarity in their role. They know what’s required and will ask questions if they aren’t sure how to live up to the expectations.

2. Regularly follow up

Delegation should never be a “set it and forget it” solution.

Proper follow up is perhaps the most vital skill of an efficient business. Meeting goals requires regularly visiting those goals and waypoints. And proper leadership requires regularly checking up on quality of work as well as the overall well-being of the team.

At first, follow up is frequent and in-depth. Over time, the frequency and depth of follow up will likely reduce.

A few examples of “following up” would be:

Checking daily tasks: Quality checking individual tasks. Individuals wouldn’t be present, but you’d bring up issues found.
Weekly check-ins: A quick in-person or virtual one-on-one meeting to go over issues, address concerns and continue training.
Regular reviews: Annual reviews are great for going over the previous year and talking about the broad accolades, issues and concerns for each team member.

Efficient firms fully leverage tools

There are two ways to grow, as a legal firm. One is to hire, delegate and take on more work. The other is to improve the speed at which you’re able to perform common tasks in your firm through the use of tools.

In terms of tools, there are those you already use and those you don’t. Efficiency in your software is about fully leveraging those solutions.

Better leveraging your current tools

Again, you probably already have practice management, document management and other tools in your firm. Ask yourself a one question about each piece of tech in your firm:

Does this tool have any other features currently not being used?

Sometimes, you’ll find some really cool features that only take a few minutes to learn. Just pull up a YouTube video or schedule a demo with the vendor and you’ll be better able to take advantage of current tools.

Note: You can also find overlap by answering this question. For instance, the project management tool also provides messaging. Save money by using the one app and cancel the other.

Using new tools to achieve efficiency

New tools are fantastic for improving efficiency, reducing time and empowering your team to better perform their jobs. One solution, specific to legal professionals, is an investigative software solution.

A tool like Tracers gives you and your team the ability to pull up 4 types of critical data on your clients or the opposition in about 3 seconds.

Witness/Person-of-interest data.
Due diligence (researching clients to mitigate surprises).
Asset searches (find assets for business or family law).
Digital footprint (e.g. social media profiles).

Imagine finding admissible proof via Facebook that a plaintiff went jet skiing on vacation while suing your client for a work injury? No need for a private investigator, just a quick search on Tracers and a scroll through their profile.

This is a single example of how an investigative research tool is likely to save time, reduce costs, and massively improve efficiency.

Key takeaway: When you set proper goals, empower your team people and fully leverage the right tools — efficiency quickly becomes the norm in your firm.