The Seven Deadly Sins of Opening a New Solo Law Practice
By Jim Calloway
[Editor's note. The online version of article is updated to reflect the dates of upcoming Opening Your Law Practice programs.]
We offer our Opening Your Law Practice class in Tulsa and Oklahoma City in the fall and at the Oklahoma Bar Center only in the spring. Those in attendance usually include many who have just taken the oath of attorney a few days before as well as those who had been in practice for some time. This free class includes lunch provided by Oklahoma Attorneys Mutual Insurance Company and a presentation on professionalism by Oklahoma Court of Criminal Appeals Presiding Judge David Lewis.
Our next edition of Opening Your Law Practice will be held at the Oklahoma Bar Center on April 28, 2015.
Since that subject is on my mind, it seemed like a good idea to cover that topic in this month’s Oklahoma Bar Journal with the seven deadly sins of opening a new solo law practice.
1. No clients
The practice of law is an esteemed profession, but a law firm is a business with revenue, expenses and the expectation of making a profit. A business cannot exist without customers nor can a law firm without clients. This does not mean you cannot open your law firm without knowing where your clients will come from. If that were the case, many would not open. But it does mean that client development will be your highest, urgent priority for you to become a success. A website is critical so you can print the address on business cards and stationery. You must send out formal announcements of your new practice to everyone that would appreciate the announcement. You must introduce yourself to local lawyers and business people, as well as judges at the courthouse. This is not a time to be shy or to wait patiently.
2. Too much overhead
Pay close attention to the amount you have each month as overhead. You should also keep a list of other annual and irregular financial obligations. You personally may have to do a lot of things you would rather not have to do instead of paying for them, like cleaning the office. As your revenues grow, you can revisit these items later. But in the early stages, every dollar you do not pay in overhead is a dollar you can take home (or at least not add to your debt load.)
3. Taking on work you cannot do or support
Do not let the need to have new clients tempt you into taking on matters that you cannot handle either because of resources or experience. You want a sustainable business and you do not need dissatisfied clients or grievances sent to the OBA General Counsel. Certainly there will be things you have to learn, but make sure that you are within the capabilities of a new solo lawyer. If a matter seems attractive to handle, but you do not believe you can handle it, ask the prospective client for some brief time to do some research and talk to lawyers that handle these types of matters. Maybe you will find a lawyer willing to team with you and show you how it is done. You may get a fee that is substantially less than handling it alone, but the client will get great service and you will also get a great learning experience.
4. Not paying enough attention to finances and financial reports
Today you cannot run your practice just by looking at your checkbook register and billing records. You need to prepare monthly financial reports (if not more frequently) and look ahead for several weeks at what expenses are on the horizon. You need to know what clients are falling behind on their obligations. There is a lot more to practicing law than just making money. But if you are not either making money or making good progress toward making money, then you will not be practicing law for long. We have many successes for our clients, but remember that for most types of businesses the bottom line is the measure of success. Do not let your many victories in other areas distract you from paying close attention to all of your financial details.
5. Failing to focus on technology
Many lawyers actively detest technology. Others view it as a necessary evil. Some even claim that they cannot master it. (I recall once calling a lawyer on this assertion, pointing out that the things he had to learn to try medical malpractice cases were much more complicated than training on law office technology.) A lawyer who is in an established law practice may rely on law office staff who understand technology or “old school” systems that still function well. But a brand new solo, particularly a young lawyer who intends to practice for many years into the future, must develop personal technology skills and pay attention to the powerful trends impacting the legal professional that are fueled by technology. Invest in your law firm technology processes for returns in the future.
6. Failing to focus on limited practice areas
Learn to do several things well first. Devote the research time to develop deep expertise. Even lawyers who have a general practice in small Oklahoma county seat towns focus mainly on doing several things rather than attempting to do everything.
7. Failure to build client-friendly systems (It is all about the clients, after all.)
It is no longer enough today to just do good legal work for clients. Today, as I told the attendees at the programs, you must do good legal work while at the same time maintaining good communications with clients. In the pre-Internet days, a two- or three-day turnaround of information was exceptionally fast. Now people can receive an email reply from the other side of the world in less than a minute. Their expectations have changed. Make certain at the initial interview you try to give your client reasonable expectations of how the judicial process works, for example, and why you cannot always return your phone calls as quickly as you like. But at the same time strive to build systems where you can return your phone calls timely. Make sure that clients understand your staff is there to assist them and answer their questions when you are not available. Keep clients informed of the progress of their matter.
Seven deadly sins was a great catch phrase to summarize some of the high points of the Opening Your Law Practice programs. Our members generally do a great job representing their clients. In fact, the lawyers we work with are more often qualified for the title saints than sinners. They often leave their warm homes at night to go assist clients when called. They sacrifice much time to make certain clients matters are handled appropriately, even if it involves working late at night.
Mr. Calloway is director of the OBA Management Assistance Program. Need a quick answer to a tech problem or help resolving a management dilemma? Contact him at 405-416-7008, 800-522-8065 or email@example.com. It’s a free member benefit!
Originally published in the Oklahoma Bar Journal -- Oct. 12, 2013 -- Vol. 84, No. 27