The Questions that Every Small Law Firm Must Answer
With hundreds, if not thousands, of new businesses opening throughout North Carolina each year, many hardly have the chance to launch before they crash and burn. The same can be said about new small law firms in North Carolina. Who’s to actually know why so many small law firms fail? One thing is for certain: the number of small law firms that are able to achieve even the smallest amount of lift-off is minute compared to the number of firms that fail or barely survive.
So, why do small law firms fail? In my opinion, lawyers, with all their wits and intelligence, refuse to comprehend or understand simple business facts and necessities. These simple realities include business principles and practices like managing finances, developing business strategies, utilizing talent and customer acquisitions.
Moreover, lawyers are notorious for opening small law firms utilizing the “copycat” mentality. The “copycat” mentality is a logical fallacy that exists because lawyers love to think of the law as the great equalizer. As such, lawyers love to think that their services are always in demand—after all, justice requires lawyers to exist. This logic causes lawyers to believe that having an office and practicing certain practice areas will magically make clients appear. The “copycat” fallacy causes lawyers to believe that the simple prerequisite to success is to have an office and a list of practice areas on a website.
On the contrary, lawyers who approach their new venture as a business by documenting and plotting a course to success are setting themselves up for business and professional success. In an effort to build your practice and shape your law firm, you should be asking yourself the following:
What is the Goal?
This question is less about your personal goals but goals for your law practice. Answer this question by defining the goals you want your law firm to achieve. Moreover, understanding your goals will assist you in better understanding what kind of practice will be required.
For example, if you plan to build a practice that is self-supporting and sustainable, you may need to focus on building a practice that is well governed by practical and realistic policies and procedures.
Finally, you need to ask yourself if your goals are worth the risk. If your goal is to create a lifestyle practice that produces enough income to support you and your family, you wouldn’t likely want to personally guarantee any business debts or need to focus on hiring numerous employees. By analyzing your goals, you may be better at understanding what you need to do to reach for success.
How Do I Get There?
After you have considered where you would like to be, it is important to begin analyzing how you are going to get there. A successful practice involves developing clearly defined strategies that adequately communicate the practice’s procedures, ideal client identity, geographic scope, practice areas and practice framework in a way that is practical and helpful.
Is this Possible?
Finally, a well-thought-out business strategy is utterly worthless if it is impractical, illegal or impossible. As such, it is important to create a plan that is reasonably feasible considering your available resources, infrastructure, commitment and abilities. It is too common for new law firms to create unrealistic goals that cause them to fail and to ultimately lose hope.
It is worth pointing out that no one but you and maybe your immediate family cares about your success or failure. If you harness your resources and infrastructure and have the necessary commitment, you can shape your law firm into the practice you always wanted.
Jared Pierce hung his own shingle right out of law school and has spent every minute since then discovering the joys and difficulties of chasing success. Anyone who has ever met Jared will tell you h