Practice Management Takes Hold in Smaller and Mid-Size Firms

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Even though lawyer management in most mid-size firms recognize the importance of developing and implementing principles of practice management as a means to insure the high quality service to clients and to improve profitability, the extent to which practice management may be implemented varies greatly from firm to firm. This is because of lawyers' personalities and ability, partners' attitudes towards “being managed,” and the extent to which they are willing to relinquish a degree of their personal and professional autonomy.

Managing partners in many firms have relegated the practice of law to individual partners and have been reluctant to impose their judgments on how individual client matters are being performed. This results from the belief that lawyer management should not have to follow up on partners responsible for performing client work or for managing substantive practice areas.

It has been this author's experience that practice management and firm management interact most closely when firm revenue and the net profit available to partners declines. When partners begin to feel the economic pinch in their pockets, there is a greater tendency to view practice areas and individual attorneys as profit centers. As such, lawyer management needs to review all of the factors contributing to profitability and to address the following questions:

• How profitable are our practice areas?
• Should the firm continue to practice in these areas or redirect its efforts to other areas?
• Can certain partners and associates be reassigned to other more profitable practice areas? If so, what training will be required to bring these attorneys up to speed in these areas? If not, what should be done with these attorneys?
• Should certain partners be assigned accountability for managing particular practice areas?
• What should be the role, responsibility and level of accountability of the heads of practice areas?

An increasing number of smaller and mid-size law offices have introduced and implemented practice management activities to insure partner coordination, control and accountability over fields of law, areas of practice and client matters.

Coordinating Partners

Generally, under plans and policies established by the managing partner, each coordinating partner is charged with planning, organizing and overseeing the proper and profitable handling of work in the practice area falling within his or her jurisdiction. Due to the overlap of substantive work of attorneys in most smaller firms, it is commonplace for the managing partner to assign authority for coordinating at least two practice areas to a partner who possesses the expertise and may be perceived as the “leader” of those areas.

A major function of the partner coordinating a practice area is to ensure the timely completion of client work in a cost-effective and quality manner. Central to this activity is the assignment of work to associates or other partners, and oversight of work assignments to attorneys by the partner who originated the matter to ensure that assignees possess the breadth of expertise to perform the work.

Each coordinating partner should be responsible for quality control and cost-effectiveness of work performed in their area. This partner should be available to discuss fees and oversee billings and collection of bills in his or her jurisdiction, as requested, and within the framework established by the managing partner. This individual may be expected to coordinate the planning for business development and/or the systematic sharing of client relations within the practice area.

Within the system of the office, the coordinating partner should oversee implementation of agreed-upon policies on billing, collections, retention, and indexing of legal forms, memoranda, opinion letters and important legal efforts for the practice area.

The partner should be consulted about, and should direct as may be required, the continuing legal education efforts for the work under his or her jurisdiction. Each coordinating partner should communicate with the managing partner and executive committee about the quality, client service and economics of professional services rendered by the attorneys within the designated work area, as well as for the improvement of such services. Each coordinator should advise, when requested or when considered appropriate, on the acceptance of new business, considering such aspects as conflict of interest, ethics, merit and strength of case, time required, ability of lawyers to handle the work, economics of the case and value to the office. If the coordinator is uncertain whether to accept a case, he or she should consult the managing partner.

The generic functions performed by each coordinating partner should be determined by the managing partner for the major areas of the office's work in terms of managing problems in work assignment, coordinating staffing, setting objectives and reviewing data to appraise results, insuring ethics and quality control, and cooperating with the executive committee. Each coordinator should be encouraged to develop his or her own style in accomplishing these objectives within the general guidelines of the office.

Daily, the coordinating partners should receive a written notice from the office administrator describing every new matter within his or her practice area that has been accepted by any attorney. These reports will advise the coordinator of the existence of new matters within their jurisdiction, along with the identity of the originating partner.

As required, each coordinating partner should meet with the partners and associates working on matters within his or her practice area to discuss strategies for progressing the volume of work and increasing revenue. Further, he or she should work closely with the firm's Marketing Director or Committee to develop tactics for increasing the firm's market share within their practice area. From time to time, the coordinating practice heads should meet with the managing partner to determine how the collaborative efforts between and among practice areas may identify and exploit opportunities to enhance revenue.

Within practice areas, the coordinating partner should discuss individual workloads, problems in producing work in a timely manner, schedule conflicts, etc. To facilitate this review, each coordinator should access the calendars and dockets for statute of limitations dates, other key filing dates, status reports or supplemental miscellaneous information and a record of every matter by the “handling attorneys.”

Practice Coordinators

The practice coordinators should review, on a lawyer-by-lawyer basis, client work that is not being performed in a timely or quality manner, or work that can afford more lawyer time. The practice coordinator should review lawyer production reports monthly, or more frequently as required, to determine the extent to which lawyers are producing the work. Following this review, the coordinator may assign or suggest reassignment of work to other attorneys who are not being utilized effectively. It is especially helpful for the coordinator to review all write-downs and write-offs of time and accounts receivable beyond certain dollar limits by billing attorney to determine the reasons and justifications for such action. If partners are writing off too much time, it should be questioned.

Within the system of the office, the practice coordinator should peform the same functions as the coordinating partner. However, the practice coordinator should consult with the executivecommittee about cases on which he or she is uncertain awhether or not the firm should accept.

The generic functions performed by each practice coordinator partner should be determined by the executive committee in the major areas of the office's work in terms of managing problems in work assignment, coordinating staffing, setting objectives and reviewing data to appraise results, insuring ethics and quality control, and cooperating with the executive committee. As with corrdinating partners, practice coordinators should be encouraged to develop their own style in accomplishing these objectives within the general guidelines of the office.

Conclusion

It has been the author's experience that the individual needs of attorneys have to be balanced with individual partner independence to be responsive to the firm's organizational patterns and policies. Applying management techniques to practice areas may introduce to the firm a new aspect on methods for enhancing profitability.

Joel A. Rose , a member of this newsletter's Board of Editors, is a certified management consultant and president of Joel A. Rose & Associates, Inc., Management Consultants to Law Offices (www.joel arose.com), in Cherry Hill, NJ. He may be contacted at 856-427-0050 and [email protected].