How To Build A Home Office Without Staff -- Answer Lawyers

Somebody recently asked me how I build a practice or practice area without employing staff?

The short answer is I collaborate.  I cofunction.  I concure.  I coproduce.  I franternize.  I partner up.  I join together.  I tie in.  I work together.  Call it what you wish, but what I learned a long time ago is that staff, although often helpful, is also expensive and costly when you have a down period.

Here is something you might not know about me.  Years ago, in a different life, I ran a traditional consumer bankruptcy law firm.  Five offices, a few lawyers, a bunch of staff, and an advertising budget of which madison avenue would be proud.  Over a thousand cases a year.  Very expensive.

This firm taught me the valuable lesson of fixed costs, and we had a lot of it.  Money came in and money went out.  When times were good, they were not that good because of our fixed costs.  When times were bad they were horrible.  Again, fixed costs was the culprit.

You cannot ask non-lawyers to take risks.  Non-lawyers expect to get paid when times are good and times are bad.  Landlords for that matter expect to get paid whether you are making money or not.  One, it is not ethical (at least in the state of Texas) to ask staff and landlords to take risks based upon the settlement or payment of your cases.  Two, this is not the bargin for which staff and landlords signed on.

Do you know how many cases you have to produce and how many clients you have to represent and how many billable hours you have to put in to cover about 10,000 squre feet of class A office space, a dozen staff, saturation TV ads, computer systems, phone systems, giant copiers, law libraries, benefits, just before you can put one dime in your pocket?

Worse, this environment leads to bad legal practices.  You find yourself signing up clients you know you do not need to be representing because you have to put numbers on the board.  Without a certain new level of business coming in, you know you are going to have a very bad experience down the road.  You begin to feel like George Jetson on the treadmill with Astro.  "Jane, stop this crazy thing"!

As you grow older what you realize in the practice of law is that you do not have to own the market.  You do not have to be king of the practice area.  You do not need a 1,000 cases a year.

You come at a Third Wave practice gradually.  You first begin to look at how to even out your cashflow to make life easier.  This leads you to look into how to decrease overhead.  It all leaves you asking "how do I bring home the money I deserve as oppose to working to support others"?  And, finally this leaves you asking how you can do this and stop working away from home, and away from my family, 60 or 70 hours a week.

When you come to grip with the answers to these questions you turn into a fanatic.  You understand that the first thing you have to do is cut overhead, staff, and expenses.  The more you cut the further you know you can go.  The further you go, the more you are encouraged.  The more encouraged you feel the more risk you are willing to take.  The more risk you take the more faith you have.  As you cut costs, you know you do not have the staff to handle the cases, so you start losing cases and try to find the ones and the type of cases you love to handle.  You start thinking of niche practices that will allow you to do this.  You'll ask yourself, "what can I handle on my own, that I will love doing, that will put a smile on my face, and that will pay me a reasonable wage"?  I am telling you it is contagious.  When the smoke, and dirt and ash clear you are probably going to find yourself alone, with a few choice cases, and a new perspective on life.

You move home and cut out all rent you are not already paying.  You redirect the careers of all staff and pay nobody that does not get paid unless you get paid.  You learn to be king of the Internet and the phone.  You find acceptable alternatives that do not cost anything, or very little.  That way, when you earn a dollar, you get to keep a dollar.  You earn a fee, you get to apply that fee directly to your household needs.  It is a wonderful feeling.

Most lawyers get in the mindset that they need help.  The think they need an outside office, a secretary, a paralegal.  They get these things and then they need more cases to pay for all of this.  They find a way to bring in more cases and they cannot handle these cases.  So they need more staff, larger offices, more lawyers and more overhead.  This leads to a need for more cases.  And then it snowballs.  You feel on top of the World sometimes because you are building a firm, a sizeable operation, but what you are not doing is building a family, a comfortable living, personal time, or a larger salary.  You find yourself working 90% of the time managing and working for the benefit of others.

My advice to you is to downshift.

Comments

[Grant Griffiths]

Wonderful, wonderful post. I can name a dozen attorneys that need to read this.

[Peter Olson]

Chuck, I certainly follow and agree with the general premise of cost-cutting and not needing all the window dressing.

But, how about accomplishing (administrative) non-billable tasks that must be done? How is it profitable for me to spend hours say sending out bills or opening files? I think a few quality staff people are very different than wasting money on rent or whatever.