Law Practice Management News
Ideas for Lawyers and Managers That Dare To Be Different December 2011

in this issue

Client Origination Credit and Importance in Law Firm Partner Compensation Systems

Diversifying a Personal Injury Plaintiff Law Firm

Controlling Cost and Managing Overhead in the Law Firm

Solo-Small Firm Question of the Month - Law Firm Partnership: Pros and Cons

Looking to Sell or Merge Your Practice - Let Us Know

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John W. Olmstead


We would like to wish everyone a Merry Christmas and a happy holiday season. We hope you will find 2012 a prosperous and happy year for you and your families.

Welcome to Olmstead & Associates Law Practice News, a law practice management resource for practicing attorneys, managing partners, administrators, and others that must keep updated on all aspects of law firm management.

Our Law Practice Management E-Newsletter is distributed on the first Wednesday of each month. Look for it and send us your emails with your ideas for topics that you would like covered. I wish to thank those who take the time to email me with their thoughts and comments. I encourage our readers to do so.

  • Client Origination Credit and Importance in Law Firm Partner Compensation Systems
  • All law firms need a mix of finders, minders, and grinders. Finders (client originators) are needed to provide sufficient work to keep the workers busy. Minders (responsible matter attorneys) are needed to manage the portfolio of client work. Grinders (working attorneys) are needed to service and produce client services. While there are exceptions, in most firms partners must hit on all three of these cylinders. In other words, most of the partners must do well at finding, minding, and grinding. Partners may perform some of these roles better than others, however overall they should be competently performing each of the roles.

    Read on . . .
  • Diversifying a Personal Injury Plaintiff Law Firm
  • We are being asked by personal injury (PI) firms to address the pros and cons of diversifying the practice and adding a non-PI practice area to the practice. While a lot can be said about specialization - a firm can also sometimes be too specialized. I have seen many hybrid firms over the past 20+ years that have successfully combined a plaintiff personal injury practice with a transactional practice. As one firm told me "us transactional folks bill the hours and pay the bills while we turn the PI folks loose to go after the big hits." Firms that operate the firm as a "firm-first" firm tend to be more successful with such a practice mix than do firms that are "long ranger" firms operating as a collection of individual practitioners.

    Read on . . .
  • Controlling Cost and Managing Overhead in the Law Firm
  • I am often asked to help law firms design and implement profitability improvement programs. In most of my engagements the real problem is insufficient gross income and lack of sufficient investment (spending and time) on marketing and initiatives designed to stimulate client and revenue growth. For most firms increasing revenues is the most effective way of impacting the bottom line. However, we do find that there is waste and unnecessary overhead that eats away at profits and a cost control program is also recommended and implemented. During recessionary times such as we are currently facing - drastic cost control are often the only option. Reducing overhead can immediately and effectively improve a firm's bottom line.

    Read on . . .
  • Solo-Small Firm Question of the Month - Law Firm Partnership: Pros and Cons
  • Question I am a solo owner of a small law firm in Southern Illinois and have been solo for ten years. I have two staff members in the firm. Recently I have been contemplating either bringing in a partner or joining another firm? What are the advantages and disadvantages?

    Answer:Partnership can offer its lawyers a measure of value independent of the skills, talents, and contributions of its individual partners.

    Pros The advantages that the best law firms have over sole practitioners or groups of lawyers who share overhead include:

    • Shared skills and expertise
    • Backup or additional help when needed
    • A safety net during economic downturns
    • Shared resources, such as technology, library and research access, forms, and work products
    • Cross-selling and/or referral of work
    • Access to the expertise of lawyers in various disciplines
    • Highly trained associates, legal assistants, and support staff
    • A firm name or reputation that makes marketing easier
    • More-sophisticated and highly skilled management
    • Opportunities for individual lawyers to become highly specialized

    • A system of partner coaching that brings out the best in each partner
    • Emotional support, encouragement, and personal recognition
    • Flexibility that allows lawyers to be more involved in probono, community, and bar activities
    • Continuation of the firm beyond the tenure of the current owners

    Cons Like anything else in life nothing is free and there are tradeoffs. There can be conflict and interpersonal struggles, large capital contributions, requirements for you to be guarantor on huge firm debt balances, missed paychecks, and loss of independence.

  • Looking to Sell or Merge Your Practice - Let Us Know
  • We frequently consult and work with law firm clients working on implementing succession strategies that involve the sale of a law practice, merging with another firm, or hiring lateral talent. If you are looking to join up with another firm keep us in mind. We will be posting confidential listings on our website in the near future.

  • FREE Guide to Law Firm Management Best Practices
  • Download a FREE copy of our Guide to Law Firm Management Best Practices.

    To learn more about Olmstead & Associates visit their web site at www.olmsteadassoc.com

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    ::Phone 314-241-5665