Why attorneys struggle with time management

A senior associate at a large law firm shared an anonymous snapshot of her day on Quora, outlining the stark reality of life in a busy law firm and lack of time management for attorneys.

“Documents begin to come back and a junior associate dumps work on me from outside of my practice group. I try to tell him to shove it, but I can’t because he has CC’d a powerful partner. I ignore the deals that I’m trying to close and deal with the junior associate’s query.” 

A brief scan of her day shows work is dumped on her by those above and below her.  This is the reason why time management is such a struggle for attorneys.

How poor time management costs law firms money

Time management is a problem for small law firms as well. The 2019 State of U.S. Small Law Firms states that small law firms often have to choose between the practice of law and the essential tasks required to keep their law firm running. 

“Nearly 40 percent of their day goes into activities other than the actual practice of law. Much of this is time for which the lawyer will never be paid.”

Forty percent doesn’t sound too bad until you realize that an attorney working 12-hours per day spends approximately five hours on non-billable work. This means they have seven hours to work with. Here’s the problem. These billable hours are battered by billable leakage, poor realization rates, discounts, and write-downs.   

Other sources state the loss is much higher. According to the Legal Trends Report, the majority of attorneys collect pay for only 2.3 hours of the work in their day. 

Why time management is a juggling act for most attorneys

Attorneys experience significant demand for their time. Whether it’s a client or new associates on the team, there are a variety of people, circumstances, and tasks competing for your time and attention: 

• Partners and associates who want to unburden themselves by giving you extra work 
• Non-billable work that requires a consistent investment of time (e.g., business development, accounting, rainmaking) 
• Crises to deal with —  external crises like client emergencies and complaints, internal crises like covering for a particular practice group, or peripheral crises like advertising fraud 
• A sudden change — an increase or decrease in client demand for a practice group or a loss of several key associates in your firm 

Adopt new processes and boundaries

Taking control of your time boils down to creating best practices and setting boundaries within your work. Adopting legal practice management software, setting calendar restrictions for when you’re available or simply saying, ‘no,’ when you don’t have the bandwidth.

The pandemic has disrupted the legal industry and many are looking for ways to increase law firm revenue. According to a recent survey by Martindale-Avvo, 81 percent of law firms have experienced a significant decrease in revenue, and 27 percent of firms have seen their revenues decrease by half.

Additional data shows firms are experiencing a 40 percent decrease in the number of new legal matters being opened each week. Approximately 20 percent of firms have been forced to lay off employees as firms struggle to survive.

How law firms can survive a downturn

Your firm needs revenue. This is an obvious but difficult proposition for firms. Research from McKinsey confirms these trends and recommends planning for the current trend to increase law firm growth in the long term.

Plan for continued pressure on pricing and on shifts to alternative delivery models. In the last downturn, standard rates continued to rise by 3 percent per year, on average, but pressure on collections did too. From 2007 to 2012, the fraction of standard rates not collected more than doubled (to 16.4 percent, from 8 percent) because of increases in discounts, write-downs, and write-offs, which left net prices relatively flat. This time around, expect that procurement teams will play an even larger role and that there will be a greater focus on commercial arrangements that provide clients with greater cost certainty, either through a fixed or capped arrangement or through one that more closely aligns fees to the outcomes achieved. Client demands and competition from alternative legal-service providers will also likely pressure high-cost real estate, staffing pyramids, and other elements of the traditional service-delivery model.”

How can your firm generate more revenue at a time when clients, who are also feeling the pressure of an economic downturn, want to decrease the amount they spend on legal matters?

There are several opportunities to increase law firm growth during a downturn.

Step #1: Maintain financial discipline

Law firms may be more motivated to use discounts, write-downs, and write-offs as a client retention tool. It helps to retain clients in the short term, but it’s destructive in the long term if it locks your firm into discounted arrangements. McKinsey agrees:

Leaders will be creative in providing pricing or volume relief. Rather than reflexively locking into long-term, highly discounted arrangements, explore ways to offer strategic investments, flexible payment terms, credits toward future services, and the broader panoply of alternative fee arrangements. Strategically show strength through extending the firm balance sheet for clients rather than gradually losing ground through a lack of pricing discipline.”

Use various tactics, like alternative fee arrangements to show your client that you are flexible and empathetic while remaining committed to the value of your work. Use realization optimization to keep realization rates high. Follow financial best practices to ensure that your firm stays in the black.

• Maintain accurate timekeeping habits
• Verify attorneys are recording their time as-it-happens instead of reconstructing their timesheets
• Follow client billing guidelines to avoid disputes
• Send invoices to the right parties (e.g., decision-makers, points-of-contact, accounting, etc.)
• Follow up with clients to ensure prompt payment

Financial discipline means financial stability. The better you are at maintaining your firm’s financial health, the greater your odds of surviving and thriving during the downturn.

Step #2: Increase law firm revenue streams

Here are six ways your law firm can generate more revenue while decreasing the amount of billable work you take on.

1. Earned revenue: This encompasses the services your law firm provides to clients. If you’re a shareholder or owner of a law firm, this is typically your primary source of income.
2. Interest revenue: These are interest payments you receive as a result of lending money to third parties, which could be from excess cash in your corporate savings account, investments, or money loaned to crowdfunding platforms like Prosper.
3. Dividend income: Revenue received from your ownership interest in a business (whether it’s an independent or client-owned business) or stock.
4. Rental income: If you own your office building, your firm could take advantage of rental income from real estate. If the space has gone unused during the pandemic, you could lease smaller units to individuals who are looking for office space.
5. Capital gains: This is income derived from the sale of investments like real estate, stocks, bonds, etc. It can also come from the sale of a business you own (e.g., your own business or equity received in lieu of payment for services).
6. Royalties and licensing: You could create an asset, service, product, process, or idea — like a paywalled guide with advice to help other lawyers run their business — then you rent it to third parties who are willing to pay you a fee whenever they use your assets.

Alternatives to increase law firm revenue streams:

• Trademark monitoring services: Monitor and manage your client’s intellectual property in exchange for a monthly or annual fee. This service can be automated or semi-automated, depending on your client’s needs.
• Legal search services: You can use software to provide clients (or other law firms) with the legal search requirements they need. Add a set number of consulting hours to the plan; provide clients with summaries, warnings, changes, reports, and disclosures.
• Subscription products and services: Providing clients with ongoing legal support for odds and ends or minor legal work via a recurring subscription.
• Annual or quarterly events: You can create your own in-person or digital conferences or meetups. Create an event around a topic, problem, desire, or goal your clients have (that you can solve), then provide them with a valuable solution. Capture a percentage of the value you create via ticket sales, product sales, or bonus offers.
• Workshops and seminars: Paid workshops and seminars that provide clients with the information they need to solve a specific legal problem.
• Affiliate marketing programs: You can promote complementary products and services on your website and marketing to generate a substantial income (e.g., identity theft protection or credit monitoring services recommended by bankruptcy attorneys).
• Employee monitoring: Monitoring employees on behalf of their employers to minimize data loss and confirm company policies compliance.
• Transactional data and analysis monitoring: This varies depending on your practice area; it can be as simple as monitoring static data (i.e., home/land sales in the last six months) or dynamic data (i.e., changing market conditions).
• Optimized origination credit plans: Motivating employees to pursue new clients and mine their professional connections to attract new business.
• Outsourcing work to low-cost, freelance attorneys: If you’ve already had to deal with layoffs, you can use freelance attorneys to maximize revenues and bounce back. This increases cash flow and minimizes the amount you’ll need to spend (salary, health insurance, bonuses, 401K, etc.) to service clients.
• Digital publishing: This category is broad — ebooks, podcasts, audiobooks, videos, blog posts; these digital products can be monetized in various ways (e.g., advertising, sponsorships, paid subscriptions, paid products, add-on services, etc.).
• Collecting capital gains:  Acquire ownership interest in corporations that are big on potential but short on cash flow and investment.

With a bit of upfront preparation, these ideas can provide you with reliable  revenue you can use to grow your firm while your competitors continue to struggle.

Step #3: Iterate and expand to increase law firm revenue

You’ll want to identify a list of three to seven ideas that work best for you.

Choose one idea at a time. Develop an idea, so it’s profitable and will increase law firm revenue at the levels you need. Then, move on to your next idea once your current revenue stream is stable and self-sufficient. Iterate and expand continuously.

Scrap the ideas that fail and focus on the ideas that are successful for your law firm.

Law firms have been hit hard by the downturn

The vast majority of firms have experienced a sharp decrease in revenue, but there’s good news.

Law firms all over the country are losing revenue. They’re struggling to survive as the pandemic and downturn continue. Alternative services can provide you with the cash flow you need to survive a downturn. With upfront planning, your law firm can thrive and find ways to increase revenue.

With a little bit of ingenuity, your firm can increase revenue while decreasing billable work. This is achieved by providing clients with the services they need to grow during the downturn, boost your revenue in the process.

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Attorney credit card services are abundant, yet many law firms are still hesitant to make the switch to online payments. Part of the reason behind this hesitation is a certain degree of uncertainty. Attorneys don’t know what to look for.

They’re not sure about the focus, features, or options that should be included. They’re not sure how to differentiate between one credit card services provider and another. Today we’re going to take a closer look at credit card processors, outlining what firms should look for and what they should avoid. 

What attorneys should look for in an online payment processor

If you’re in the market for an online payment processor, it’s a good idea to look for processors who offer the following:

1. PCI compliance: Compliance means your provider has taken on the burden of ensuring you, your clients, and your data remain safe and secure. Your credit card service provider should be willing to walk you through a self-assessment questionnaire to verify that compliance is achieved on your end. They do most of the heavy lifting, but compliance is an absolute must. Your provider should be willing to provide you with an attestation of compliance when requested. If they can’t, walk away.
2. Strict security protocols: Working with you, your payment processor should be fully capable of protecting sensitive business and client data, whether you’re dealing with data-in-use, data-at-rest, or data-in-transit. They should be able to provide this level of security without negatively impacting your firm’s performance or productivity.
3. Open and transparent: Your payment processor should provide you with clear agreements with precise language. They should provide you with a clear list of fees (e.g., pricing is 3.3% + $.60 per transaction + $60 per mo.). If there are any unexpected fees or expenses, these should be disclosed clearly and completely before you sign on the dotted line.
4. Attentive customer service: It’s a good idea to identify what you want first. Do you want your payment processor to provide you with the handholding you need, or would you prefer them to process your payments and leave you alone? Determine what you’re looking for first, then find a reliable provider who’s willing to accommodate. Remember the adage, “how they sell you is how they’ll serve you.”

Third party processors can be a hassle and may not meet legal standards for accepting online payments. Attorneys should look for payments processors that are easy to use with transparent pricing. Built-in processors, like Bill4Time Payments, are compliant and offer industry-low fees. The feature is accessible within your Bill4Time account and easy to activate.

Attorney credit card services are straightforward

Many law firms are still hesitant to make the switch to online payments even thought billing software has been show to increase productivity across their practice.

A hidden concern that’s driving their hesitation is the fear that something will go wrong. They’re not sure how to differentiate between credit card services providers. They don’t want to be burned.

With the right education, attorneys will be able to choose the credit card service provider that meets their needs. They’ll be able to identify the focus, features, or options that should be included with their ideal provider, no mishaps necessary.

If you’re not already using Bill4Time, schedule a demo to learn how to get access to Bill4Time Payments and other features to streamline your business.

What’s the first thing most professionals do on social media? They beg. Add a new follower on Twitter or Facebook, and almost immediately, you’re bombarded with a request or demand; your new “friend” wants a favor, one that requires you to share personal information, spend a lot of money, or donate your time. Attorneys using social media should take these steps to build valuable relationships and generate clients.

Begging destroys business development opportunities

When I use the word “begging,” I’m not referring to the indigent or those in need. I’m referring to those who can’t be bothered to build a relationship with you the right way, before asking you for your time, resources, or energy on their behalf.

Here’s how the scenario works: You’re a corporate attorney, and you’re trying to connect with small business owners online. You greet followers, and you work hard to engage with business owners authentically. On the other hand, these business owners see you as a mark, just another customer.

So they spam your inbox with requests like this.

They’re interested in the value you provide, but they also want you to invest what’s yours in their business, for free, with no relationship established. This is the problem with business development and social media. It’s the same problem many new law firms make on social media platforms.

Successful business development begins with a relationship

Professional relationships are built around value. Inexperienced attorneys invert the value equation. They immediately attempt to extract value from new followers and connections. This immediately ruins the relationship with potential clients. Savvy attorneys work with the value equation to generate clients.

You’re probably wondering, what is this value equation? It’s actually two equations that work together.

1. Value equation #1: 80 percent giving, 20 percent receiving.
2. Value equation #2: Create X dollars of value. Capture Y percent of X.

This is how successful business development is done online. Now, let’s take a closer look at these equations so we can use them effectively to attract and win new clients.

• 80 percent giving, 20 percent receiving: 80 percent giving is exactly what it sounds like. You’re spending most of the time you have allotted for social media business development, on sharing valuable information with prospective clients. 20 percent receiving, on the other hand, is different. You’re spending 20 percent of your time, making an offer that creates more value for prospective clients.
• Create X dollars of value, capture Y percent of X: You create value for prospective clients, then you create a complementary offer that amplifies the potential value clients will receive if they choose to work with your law firm.

Apply these equations consistently along with the details you’ve learned about making and keeping friends, and you’ll find business development on social media is fairly straightforward.

How do you use social media to generate clients? 

Imagine that you’re a real estate attorney. You work with investors, real estate agents, and other corporations — you assist them with all things real estate. Now imagine that a prospective client is in the market for a real estate attorney. 

They have a specific set of problems, but they’re not sure where to start. How do you apply these value equations? How do you go about creating value for your clients? Here’s a list of ideas we can apply to our real estate attorney example.

1. Answering real estate questions on Quora
2. Creating profiles on real estate forums like Bigger Pockets and answering questions with people
3. Creating city-specific groups on Facebook and LinkedIn to help people in your local area
4. Use hashtags and geotargeting to help locals on Twitter who need advice
5. Join a Meetup group to discuss real estate or create your own. Meet online and in-person
6. Create YouTube videos that focus on real estate
7. Join Clarity.fm; add each of your junior associates as experts on their platform, then promote them as paid advisors
8. Make a list of all of the local Eventbrite real estate events in your area. Contact the event organizer and offer to speak or present at their next event
9. Reach out to influential thought leaders and publishers to generate clients (i.e., Loopnet) on social media and make an offer to create content for them (e.g., Q&A, articles, videos, podcasts, etc.)

These ideas are simple, but they require a long-term commitment. Once you become known for these ideas, you’ll have the trust you need to scale business development.

Did you catch it? The equations in action? Each of these ideas is an example of the value equation in action. These ideas are focused on giving prospective clients maximum value. How do you capture a percentage of that value?

Generate clients with a lead magnet.

You give them a helpful checklist, resource, guide, or book in exchange for their email address. Using these tools along with local SEO, you will have a steady supply of leads. When clients are interested in purchasing a property, you’re the professional they’ll contact. Why? The law of reciprocity.

Our cultural conditioning tells us that we’re supposed to respond in-kind. If we receive a positive action, we’re expected to reward the giver with positive action in turn. If we receive a concession during a negotiation, we reward that concession with a conciliatory reward.

Attorneys using social media to generate clients should build relationships through a value exchange; this is the secret to social media business development. This is how business is done at the highest levels.

Getting clients using social media is easy

When you earn a friend, follower, or fan, build the relationship by looking for ways to add value to the relationship. To generate clients, focus your attention on giving and serving, spend most of your time focused on taking care of those around you and opportunities to receive will present themselves.

Work to avoid begging. Avoid professionals who can’t be bothered to build a relationship in the right way. Give and serve before you ask. The attorney/client relationship hasn’t been established yet, that’s okay. Stay within the bounds of professional conduct but provide value.

Focus your attention on adding value, and you’ll find prospective clients are begging for your help and support.  

Your law firm could increase revenue by 53 percent or more by selling both products and services to clients—attorneys billing hours by the day, selling legal products by night.

According to Mark Cohen, speaker on law firm innovation at LegalMosaic, “The traditional law firm economic model is predicated on high-intensity, high-priced labor as opposed to products, but nonetheless, this is something clients are increasingly demanding.”

Most firms haven’t embraced this model, but it’s a revenue model law firms can use to attract, earn, and win more high-quality clients consistently. Today I’m going to show you how this model can provide you with free advertising. 

Using products to attract more clients

The business model is simple, and it doesn’t require a whole lot of babysitting. It needs some upfront work to set things up, and a willingness to maintain the revenue model, so it continues to perform well for you. 

Here’s how this model works:

1. You advertise on a specific platform. I’m recommending pay per click advertising (e.g., Google ads or Bing ads) to start. 
2. You send customers to a specific landing page with an irresistible quid pro quo offer (i.e., trading education for an email address). 
3. You offer the subscribers an irresistible, low-cost product to gauge interest levels and segment prospective clients.
4. Clients subsidize your advertising; they pay you to promote your law firm. 

Here the ingredients you’ll need.

• An irresistible offer
• A strong value proposition
• Money to advertise ($300 per mo. minimum)
• An email service provider
• A website or landing page (and all that comes with it)
• Strong educational content
• Social proof, credibility, and authority markers
• Product risk-reversals (you’ll need to verify the legalities)

You must invest the time needed to get these details right. Shoddy website design, an unreliable email service provider, or weak educational content, will sabotage the results you receive. As the saying goes, garbage in, garbage out.

The product you offer depends on your goals

Lead generation for attorneys involves planning and you’ll need to determine what your goals and objectives will be ahead of time. Are you merely looking for a way to generate more leads? Would you prefer to transition fully to products? Maybe you’re interested in creating a hybrid firm — 70 percent of the revenue comes from billables, 30 percent from products.

It’s entirely up to you. You must identify these goals ahead of time, so you aren’t distracted by offers that take you away from your goals and objectives. Which products should you sell? You can sell:

• Books
• Courses
• Workshops
• Seminars
• Events
• Initial consultations
• Productized services 
• Tools
• Apps
• Connections
• Access

There’s more ways to increase revenue without sacrificing billable hours, but I think you get the point. Using these resources, you can generate a significant amount of revenue for your law firm and attract new clients simultaneously. 

Let’s take a look at our fictitious firm, Goldsmith, Price & Cooper, who wants to expand lead generation for attorneys and test this model. Goldsmith, Price & Cooper specializes in business law. They’re particularly interested in startups and small businesses. They’ve noticed that prospective clients have some common misconceptions about incorporating in Nevada.

Their clients are worried about asset protection. They want to provide their clients with the help and support they need, but they also want to make sure their firm is profitable. They gather their ingredients together.

• Two irresistible offers: (1.) An asset protection toolkit and (2.) They write a book on asset protection
• A strong value proposition: Their firm offers battle-tested asset protection
• Money to advertise: $2,500
• An email service provider: Mailchimp
• A website or landing page: (a.) A landing page for their asset protection toolkit and (b.) A sales page (with checkout via easy-to-use tools like Gumroad) to sell their book
• Strong educational content: Thorough, informative content that exposes their need for help. 
• Social proof, credibility, and authority markers: “As seen on” badges that highlight your firm’s expertise and recognition in the marketplace
• Product risk-reversals: A 30 day, no questions asked refund policy for the book 

Next, Goldsmith, Price & Cooper arranges these ingredients in the right order. They set things up so prospective clients: 

1. See their ad on Google or Bing
2. Click on their ads
3. Arrive on their landing page
4. Enter their email address to receive the asset protection toolkit
5. Views their irresistible offer and decides to purchase their asset protection book
6. Are invited to set up an initial consultation with a partner (not an associate) at their firm

Using this structure, you can produce a consistent stream of high-quality clients who are eager and willing to invest the amount needed to receive your expertise. You create products that deliver a substantial amount of revenue for your firm, subsidizes your advertising (so it’s free), and generates leads — all at the same time.

Selling legal products boosts law firm profitability

Your law firm can increase revenue by 53 percent or more by selling both products and services to clients. As we’ve seen, the issue with lead generation for attorneys isn’t whether this strategy is viable; it’s about structure. 

Most firms haven’t embraced this model but it’s a revenue model law firms can use to outperform their traditional-minded competitors. Using the structure I’ve presented, your firm can generate a significant amount of revenue for your law firm and attract new clients simultaneously.
But it all depends on structure. Solve your prospective client’s problems, and you’ll find they’re eager to invest in the products and services they need to protect their interests.