“With a staffing footprint of only a few attorneys why do I need a bookkeeper?” It’s a question I’ve heard a lot over the course of my career. Many lawyers who work in small firms don’t see the benefit of relying on external expertise to keep their books organized. Unfortunately, many of those same lawyers eventually come around to a different way of thinking only after something bad, or even catastrophic, happens with their accounts.
You probably didn't factor a global pandemic and national lockdown into your business plan! So now is definitely a good time to revisit your business plan for the next year. We know that writing a plan can feel like a big effort so we have created a template to make it easier. Please get in touch if you’d like to talk about your plan – especially the financial parts like cash flow.
Things are tough right now. At the time of this writing, Covid-19 is wreaking havoc with local and national economies everywhere. Businesses, including law firms, are struggling to stay afloat. In short, things look bleak.
But we’re optimistic. We think there are a lot of good reasons not to throw in the towel and give up. Continue reading below to find out why we’re still looking on the bright side!
Yes, things are looking bad at the moment. And yes, things may get worse. But we have every reason to believe that circumstances will improve in the long run. Just as the last 150 years have represented an almost uninterrupted climb up the ladder of human productivity and wellbeing, we expect that the next decade will be no exception.
The fundamentals of the American economy are strong. People are educated, relatively wealthy, and productive. We’ll get through this crisis like we’ve gotten through every other crisis: with grace and efficiency.
Now more than ever, your clients need you. People don’t go to lawyers for the company (although you do make fantastic company). They come to you because you can solve their problems. Whether you’re a personal injury lawyer seeking justice for an injured driver or a solicitor trying to help a client through a complicated contract of purchase and sale, your clients need you now.
The last thing your clients want is for their lawyers to become unavailable at a time when the world seems to be grinding to a halt. It’s in times of trouble and crisis that people rely the most on the professionals to help them with. You can’t let them down.
While it would sometimes be nice to simply hit pause on everything in your professional life it doesn’t work that way. From your support staff to the lawyers who work with you to the people in the court office, all of us are interconnected and rely on one another to get us through the month. We need one another to help us pay the bills, rent, and to support our children.
It’s almost certain that you want to be able to step up and support your employees and colleagues through these difficult times. The sooner and faster you can get things back to “normal” at your firm, the sooner your people will be able to stabilize their lives.
Not only do we have good reason to be optimistic about the ability of the world to recover from this shock, but we also have good reason to believe that you have every incentive to help that happen. People depend on you and your firm to deliver results, solve problems, and put your people to work. Believe it or not, but before you know it you’ll be doing these things like never before. The country, your firm, and you are stronger than you’ve ever known.
Covid-19 has brought with it a whole host of financial difficulties. For a lot of law firms, new client flows are drying up while existing clients aren’t conducting business. As a result, there just isn’t a lot of work to go around.
For many firms, this means struggling to stay afloat. And while, in the midst of a crisis, there may not be a lot we can do other than try to survive, there are things we can do to blunt the impact of the next downturn in business.
Continue reading below to see our favorite tips for how to prepare for difficult financial times.
One of the best ways to ensure that you’re able to endure financial downturns when they occur is to run a lean operation. Minimal staff, minimal overhead, and minimal costs should be the name of the game. Luckily, this is easier than ever to do. Modern technology allows for efficient firms to operate with very little overhead.
The secret to maintaining a lean operation is to manage your workflows. It will come as no surprise to lawyers who have been in practice for more than five minutes that work tends to follow predictable patterns. From marketing to client intake to file prep, maintenance, work, and payment usually follow the same steps. For example, real estate clients will almost always follow a familiar pattern.
For those firms that are on top of their workflows, automation through software can be a huge help. It increases the quality of client service and reduces errors while improving efficiency.
Flexibility is key to surviving an economic downturn. So while you want to be as lean as possible, you don’t want to eliminate any possibility of making significant changes quickly should the need arise.
Backup and contingency plans are key to making this work. If key support staff fall ill or an extended power outage affects your area, you should have backup plans in place for how to deal with these eventualities.
Similar to backup and contingency planning, you should have concrete, written plans for what to do in the event of an economic downturn. Budgeting and business planning should usually include a worst, usual, and best-case scenario. (In fact, the best-case scenario probably isn’t necessary since it's usually just an exercise in wish fulfillment.)
Those firms that have set plans for what to do in the event of an economic emergency typically perform much better than those firms that don’t have anything written down and are forced to wing it.
The next few months are going to be tough. Covid-19 has taken a huge toll on the ability of the average person to conduct business, which is having huge knock-on effects on law firms everywhere. But with a little bit of planning and strategy, you can make sure that the next disruption doesn’t knock you on your butt.
Covid-19 has hit law firms especially hard. The face-to-face nature of a lot of legal work and in-person courts have ensured that legal settings are breeding grounds for the virus. Quarantines and business slowdowns have ensured that firms are suffering a significant reduction in both clients walking through the door and in the ability to conduct litigation and legal work.
If there’s any silver lining for the legal industry during this outbreak, we hope that it includes an increased realization amongst the members of the legal community that some things need to change. What do we think is most in need of transformation? Continue reading below to find out.
For most kinds of legal matters, litigation is almost always conducted in-person. And this makes sense, for the most part. Litigation is a high-stakes game dealing with sensitive subjects. It’s only fair that a defendant is able to see the witnesses arrayed against him or for a plaintiff to be in the same room with the defendant.
But there are undoubtedly ways to decrease the amount of in-person contact between the parties to a court proceeding. Some simple court proceedings, like routine criminal court matters (bail hearings, for example) could be conducted by videoconference at a fraction of the cost.
While complex trials likely won’t be going virtual any time soon, things like depositions could very well occur online. The presumption towards in-person hearings should shift in favor of a presumption for virtual presence.
Legal culture is extraordinarily conservative. It’s not unusual to hear lawyers bemoan the advent of computer technology and brag about their ineptitude with technology. This is unfortunate. A culture that clings to the past forfeits the future.
A culture shift is required amongst lawyers, especially the more established ones, to allow for new and more technological ways of doing business. Whether that’s an openness to storing documents in secure clouds, conducting virtual meetings, allowing for documents to be e-signed, or encouraging support staff to work from home, there are countless ways that lawyers could encourage innovation in the legal workplace.
Because lawyers and law firms are usually so busy, many of them do very little strategic planning for the future. As a result, disaster mitigation strategies for a lot of firms simply don’t exist or are woefully inadequate.
We hope that one of the consequences of the current crisis is a renewed focus by lawyers and firms on the importance of planning and strategy. Just as important as meeting the day-to-day needs of their clients, proper plans guide the future of a firm and prepare it for success.
Covid-19 has suddenly created a new and unpleasant reality. Our hearts go out to everyone affected. We hope, however, that some good will come of this crisis. We hope that the legal industry will learn the lessons of the outbreak and put them to good use so that we’re better prepared for the next disruptive event.
The extent and depth of the damage caused by Covid-19 were unexpected. The fallout from the impact of the virus will likely echo into the months and years ahead in a variety of forms: economic damage, personal difficulties, and business disruption, among others.
But a few things are certain. First, this too shall pass. It might be a cliche but, eventually, things will return to some level of normalcy. The United States is a fundamentally strong nation with a healthy economy and, as a people, we will endure. Second, another crisis will come along after Covid-19 is just a memory.
Time will tell if we were prepared enough for Covid-19. What we can guarantee, however, is that we are prepared for the next crisis that comes along. So how do you go about ensuring that you’re ready for the next disruption? Continue reading below to find out.
Remember the fable of the ants and the grasshopper? The ants spent all summer gathering and storing food for the winter while the grasshopper played music. When winter came around, the ants had food and the grasshopper went without.
Be the ant, not the grasshopper. Use times of plenty, not just to gather and store resources for the future, but to future-proof your business. Use good times to make plans for business disruptions and organize your firm for maximum flexibility. That way, when the hard times come knocking, you’ll be well-prepared.
We’ve already written an article on some of the tools you can use to remotely work from home. But technology has benefits beyond just allowing us to work from home. Cloud software allows us to secure our data and make it accessible from anywhere on the planet. Video conferencing software allows us to stay in contact with our clients from a distance, even if they’re unable to come into our offices. And budgeting and bookkeeping software allow us to keep a close eye on our finances to ensure we have a rainy-day fund set aside for leaner months.
There are reams of technology available all over the internet to help us shock-proof our firms. And while we’ll still suffer some of the ill effects of an economic downturn, that technology can turn our firms into lean and flexible organizations able to adapt to almost any situation.
Every plan needs a backup. Just as you want your organization to be lean and adaptable, you want backup plans in place in case that key employee comes down with an illness or you lose your internet connection temporarily. You should have a backup plan at the ready for every key technology and component you rely upon.
These are difficult times. We extend our sympathies to anyone affected by Covid-19 (which is almost everyone these days). But let’s use these hard times to the best of our ability to mitigate the damage of future crises. We owe it to ourselves, our colleagues, our clients, and our loved ones to be as resilient as possible.
