Partner's Report for Law Firm Owners

Increasing Margins: Billing Rates Increase Modestly, While Partners’ Billable Hours Drop Noticeably;
Exercising Leadership: How to Spot, Grow, & Get the Most From Your Up-and-Coming Partner/Leaders;
Organizational Strategy: When the going gets tough, partners must take action;
Compensation: How much partners pay their law firm administrator;
Innovation: Who better to grill partners’ clients about their needs, likes, and dislikes than a journalist?;
Managing Associates: Some law firms are already pruning their associate ranks;
Overhead: Health care costs continue to take a big bite out of partners’ bottom lines;

The leadership drought created by the impending wave of baby boomer retirements should have law firm owners in defensive mode. The impact on those who do not have a sound policy in place to deal with such departures is immeasurable. Leaders, after all, don’t grow on trees.

Have cost-conscious clients finally forced an end to annual rate increases? Admittedly, it’s unlikely. Savvy clients understand that firms also are dealing with pressures brought on by the economic downturn. Still, there is change in the air.

When the going gets tough, partners must take action. Change is difficult, however, so some law firm owners inevitably fall victim to defeatist thinking. To avoid this tendency, consider and avoid the five behaviors outlined below:

How much partners pay their law firm administrator. Consider, first and foremost, that it’s a demanding job; one that continues to evolve as owners expect these nonlawyer professionals to handle myriad tasks.

Law firm owners haven’t lost their urge to merge. On the contrary, industry experts predict that the pace of law firm mergers won’t slacken in 2008, even in the face of a recession.

Who better to grill partners’ clients about their needs, likes, and dislikes than a journalist? It’s an interesting concept about to be tested by Ballard Spahr Andrews & Ingersoll, which has hired a full-time client interviewer for its Philadelphia office.

Some law firms are already pruning their associate ranks in an attempt to expediently deal with the current economic decline and its impact on profitability. Is this the most prudent approach? (See the accompanying sidebar.)

Health care costs continue to take a big bite out of partners’ bottom lines. True, such expenses are simply a cost of doing business, but savvy law firm owners know how vital it is to monitor such expenses.

Six simple tactics to help partners recession-proof their law firms. The steps outlined below should help owners get their firms through the economic downturn:

Partners, understandably, find it difficult to crack down on delinquent clients. Still, as financial pressures on law firms continue to mount, all leaders must take a look at the viability of their firms’ billing and collections procedures.

Quick rules help partners conduct more productive performance evaluations. The primary goal—especially for law firm owners who may need to make tough decisions in the months ahead—is to glean as much information as possible from the process. To do this, make sure to:

Now’s the time for all law firm owners to cozy up to their clients. In these times of belt-tightening, the best way to grow your firm may be to expand services to existing clients. This also is a good client-retention strategy since providing more services to your clients will tie them closer to you.

To blog or not to blog, that is the question for many partners. Even as the number of lawyers and firms that maintain a blog continues to proliferate, some practitioners are unsure about how to proceed or whether to allow members of their firms to blog. With this in mind, below we offer guidelines to consider:

Think partner compensation has stagnated? It could be worse: New York state judges have not had a pay raise in 10 years.

Advice for partners slated to speak at an industry conference or seminar this summer. Below are pointers that can help you with content, organization, preparation, delivery, visual aids, and avoiding panic attacks: