Integrity Marketing

Domestic Partners Inheritance Rights

Inheritance Rights of California Domestic Partners Preserved

see: Law Professors Blog

California Practitioners Alert!

Yesterday (June 29, 2005), the California Supreme Court unanimously declined to review the lower court's opinion in Knight v Superior Court which, among other things, preserved the right of a surviving domestic partner to inherit from the deceased domestic partner in the same manner as a surviving spouse. 

Marketing Luxury Brands

How to Market Luxury Brands to the Loyal Affluent

Estate Planning is not exactly a high-velocity, red-hot, tantalizing product that draws clamoring crowds and long lines outside your office, now is it?

Of course not. So, do you really think you should play follow-the-leader and adopt marketing strategies as if it were?  You will recognize some of the strategies employed by low-end fashion giants -- including fast delivery, frequent "reinvention" of the product line, and a consumer message that says -- "Throw out what you have and come in NOW for the newest styles!"

"Not everyone, however, is up for an exercise in velocity. In fact some brands move happily at a snail's pace, and base their successful business strategies on extended, if not permanent, shelf lives for products. Hallowed luxury brand Hermès, of course, serves as the benchmark for this type of strategy (think of the 75-year-old Kelly bag and its famed wait list or the classic men's ties which are sold in bundles year in and year out).  Many Italians are also in the business of evolution, not revolution, and they aim to create hits that will last a lifetime."

Learn more about how savvy luxury brand retailers gain loyal customers by remaining loyal to themselves: Keeping Ahead in Fashion's Slow Lane, International Herald Tribune.

HINT: "There's a wealthy consumer today that wants products that are the best of class," says Robert Burke, vice president and senior fashion director at Bergdorf Goodman. "And they're willing to pay for it. They want the most perfect jacket, or perfect piece of outerwear. They don't want the products to change. They are looking for products that they can depend on."

Download ABA's June 2005 RPPT Bulletin

June 2005 Issue of the ABA's RPPT Bulletin Now Online

The June 2005 issue of the ABA's RPPT Bulletin is now available.  Here are some of the highlights:

• Circular 230:  Practitioners who are not yet familiar with the recent changes to Circular 230 should soon carefully review them, as the new rules apply after June 20,2005. (The revisions to Circular 230 are found at T.D. 9165, as amended by T.D. 9201.) The most controversial change to Circular 230 is new Section10.35, which compels practitioners to meet extensive requirements for written communications (even emails) that are "covered opinions."
• Pro Bono Committee Workshop: Pro Bono and Legal Services Partnering to Combat Predatory Foreclosure Practices. Learn more about the Committee's initiatives to counsel consumers on how to avoid predatory loans. 
• New Book:  The Funding of Living Trusts by Carla Neeley Freitag.  Available from the ABA bookstore: http://www.ababooks.org/
  This guide provides an overview of trust funding and details specific, practical steps for transferring a wide variety of assets from the client to the trustee, including sample completed forms, transmittal letters, and client letters. It also analyzes developing case and statutory law involving trust funding issues. RPPT Member Price: $119.95 Regular Price: $129.95
• Toolkit:  Copies of Lawyer's Toolkit for Health Care Advance Planning are available free of charge. Email requests to: [email protected]
• Attorney-Client Privilege:  The ABA Presidential Task Force on the Attorney Client Privilege was established in reaction to “attacks” on the privilege.  The web site for the Task Force is: http://www.abanet.org/buslaw/attorneyclient/home.shtml.

#8 Law Firm Business Killer -- Poor Staff Management

Poor Staff Management --

By and large, attorneys (as a group) never got high marks on "works and plays well with others." In fact, as a profession, they have made a science of the adversarial relationship. This proclivity frequently impacts poorly on a variety of interpersonal relationships -- including staff management.

Team building, cooperation, recognition, and DELEGATION are all management skills in short supply at many law firms, but DELEGATION seems to be the most difficult task for lawyers to master. There are basically three types of DELEGATION mistakes:

1. Not Delegating Enough
   Many lawyers have a hard time letting go of ANYTHING. They cry for assistance, but then cannot release enough control to allow anyone to TRULY help them. You may fall into this category if you: insist on answering your own phone, keep religious control of your schedule (no one can make appointments for you), are the only one who knows where your case files are -- or how they are organized, copiously re-write briefs or documents prepared by your associates (instead of coaching them on how to improve), or find you are bogged-down with routine administrative tasks.
2. Delegating Too Much
   Okay, some of you are on the opposite end of the spectrum. You delegate too much to your associates and staff -- often without adequate preparation. But even worse than failing to prepare others for the tasks you delegate to them, is failing to establish a system of accountability to ensure the tasks are completed properly and in a timely manner. People who receive responsibilities for which they are unprepared frequently panic. They may go to great lengths to prevent you from discovering their ineptitude (which likely is not their fault, but they are worried about losing their jobs!). They may hide the sloppy or unfinished work. They may even lie about it. Driving these poor people crazy is bad enough, but the damage their ineptitude causes to your clients -- and to your reputation -- is even worse.
3. Delegating Inappropriately
   There are some things that only you can -- or should -- do. Just because you are busy, or because they are not your FAVORITE tasks, does not mean you should delegate them to someone else. Those tasks include: personal networking with referral sources, personal marketing with clients and prospective clients, meeting with new clients or prospects, attending (particularly) high-profile marketing events, etc. A few years ago, there was a popular marketing guru encouraging estate attorneys to delegate client "screening" to an assigned staff person. EVERYone who sought to become your client would first meet with this staff person (not an attorney) and progress through a screening process before ever meeting with you. This sounded like a dream-come-true for busy attorneys who basically did not like people all that much (see above -- working and playing well with others). If you ONLY meet with people who have been pre-screened and are ready to move forward, then you can avoid that uncomfortable getting-to-know-you phase, skip the how-can-I-help-you? phase and get right to the let-me-tell-you-what-to-do phase (this is of course the favored phase of characters like Lucy from Peanuts!). It was a classic example of Killing Your Practice through Inappropriate Delegation, and most came to financially regret the decision to implement such an expensive and onerous protocol.

When DELEGATION mistakes plague a law firm in our coaching program, we recommend a systematic approach to solving the problem. The first exercise is basic task-identification, but there is a key twist in the process. Each person involved in the project creates three sets of task lists. The first list outlines all of the tasks necessary to complete the project. The second list includes which of these tasks the individual does him or herself. The third list outlines WHO this person thinks is doing all of the other tasks. The fun starts when you all get together to compare lists! Try this exercise in your own firm. You will be surprised to learn how much overlap, under-lap, and inappropriate delegation takes place. In one firm, we broke down the simple project of scheduling and conducting a client consultation. Not only did we find a number of "gaps" in the respnsibility lists, but discovered that -- of all the people on staff in this law firm, it was the PRINCIPAL ATTORNEY who grabbed the glass cleaner and paper towel to ensure the glass-top conference table sparkled before and after each meeting. We identified that as an inappropriate delegation.

#7 Law Firm Business Killer -- Poor Diet

Failure to Focus on Revenue-Generating Activity

This may seem like a no-brainer, but it's easy to get bogged down in administrative work -- or the business of running the business -- instead of focusing on those activities that actually generate, or at least lead to generating, revenue.

Here are some examples of activities that do NOT generate revenue:

1. Meeting with vendors and/or reviewing their products and services (this includes new software, cell phones, and very cool palm-sized communication devices!).
2. Refereeing employee squabbles.
3. Cleaning and/or organizing your office, desk, or files.
4. Attending continuing legal education (yes, it's required, but you're not getting paid!).
5. Chatting it up with your colleagues -- about ANYTHING, including the weekend's activities, the fate of your favorite sports team, or even the case you settled last week.
6. Personal business -- no matter how urgent (or mundane -- I once observed an associate attorney who had fallen into the habit of taking four-hour lunches so he could go home and walk his puppy!).

Examples of revenue-generating activities:

1. Meeting with clients.
2. Serving clients.
3. That's pretty much it.

Examples of activities that LEAD to generating revenue:

1. Personal marketing: presenting at a workshop, meeting with referral sources, making personal contacts (such as writing a letter, making a phone call, or scheduling a luncheon).
2. Contributing to firm marketing (such as writing that article for the firm's newsletter, attending a firm-hosted function, assisting a colleague in landing a new client, etc.).
3. Training staff (to the extent that staff training expands your ability to serve clients).

Most of us KNOW that our work days should contain healthy doses of revenue-generating activities, but it's easy to get involved in other things. Administrative work needs to be done. You need to spend some time on those activities that can LEAD to generating revenue (in our coaching program, we call those "sowing" activities). But at the end of the day, you haven't made any money if you haven't met with and served clients. One good way to increase revenue is to track your activities for a month. In our coaching program, we encourage clients to track their REAPING activities (revenue-generating) and their SOWING activities for a month. Reviewing the logs at the end of the month is an eye-opening experience for most.

The goal is to strike a healthy balance. It's a little like building a healthy diet, where reaping activities represent protein, sowing activities your fruits and veggies, administrative jobs the complex carbohydrates, and everything else is dreaded fat or refined sugar!

#6 Law Firm Business Killer -- Rigid Protocols

Rigid Protocols That Fail to Adapt to Emerging Client Needs

Law firms frequently enforce established protocols with a rigidity that limits their ability to attract and serve emerging client needs.

One example is the billing protocol. Too many firms view hourly billing with a type of religious fervor that prevents them from serving -- and profiting from -- today's savvy, demanding business client. The "information age" has exploded, creating sophisticated clients who are demand "value" from their legal advisors, not merely an itemization of their time. Law firms may assume (wrongly) that their time has intrinsic value, and therefore needs no further justification. The fallacy of this position is clear. While your time DOES have intrinsic value -- to YOU -- it does not carry the same weight for your client. Learning to create value for, and demonstrate value to, the client requires a true paradigm shift that many firms (understandably) resist. The good news is that, once that shift is made, your practice can be transformed! First, you are liberated from the slavery of the clock and forever measuring your life in six-minute intervals! Second, the powerful truth is that, in terms of VALUE, your services are worth MORE THAN the total of your time! When you accept the challenge of creating and demonstrating value, you are empowered to do your best work for the client -- even if it takes only one-tenth of an hour on the phone to make the problem disappear. Charge for the value of your wisdom, experience and negotiating skills -- then spend the evening with family and friends on your back deck with a glass of chilled wine and perhaps a fine cigar!

Successful firms truly are client-centered, which means they evaluate their services from the client's perspective. While established protocols can (and should) improve your efficiency and help enhance quality-control throughout the organization -- they should NOT interfere with your mission of serving clients, meeting their needs, and providing value. Be willing to re-evaluate rigid protocols, particularly when their only sustaining justification is, "That's how we've always done it!"

#5 Law Firm Business Killer -- Referrals

Relying on a Small Base of Referrals

Referrals are the life-blood of any law practice. Whether they come from allied professionals (such as accountants and financial planners), insurance claims managers, other attorneys, or word-of-mouth, every case in every law firm was referred from somewhere. Even those rare clients who seem to have appeared from "nowhere." We call them "self-referrals."

Building a referral base is one of the crucial steps in any practice development plan. Unfortunately, most firms find success too soon. After a few initial contacts, they strike up some good relationships. As soon as the work starts flowing, they fall into a routine of taking care of clients, managing cases, and having lunch meetings with those few. The relationships become comfortable and the referrals (somewhat) reliable, though necessarily limited in volume and scope.

The real problem is that most practice development plans start start off on the wrong foot -- with the wrong goals. If the only goal is to bring in new work, then it is met too soon.

"New Work" is one goal.

"Expanding the Referral Base" is another, completely separate goal. Be sure to set it high enough.

Consider the sage financial advice of portfolio diversification. You wouldn't put your all of your retirement savings into only one or two stocks, or even one or two market sectors. No, you choose to diversify in order to minimize risk. If one company, or sector, goes south -- you hope to offset the losses by gains in other investments. The benefits of asset allocation apply to your referral base, too.

By expanding, and diversifying, your referral base you are not only minimizing your risks -- but also setting the stage for a potentially wonderful eventuality. Keep working on broadening, deepening and diversifying your referral base and you will eventually enjoy the happy day when you can pick-and-choose your cases.

I think this is what we ALL want to achieve. An abundance of referrals that afford us the luxury of saying no. Of choosing the cases, and the clients, that most fit our talents, passions, and profit-profiles.

Review your practice development plan. Expanding your referral base is an ONGOING process. Set specific goals, and the activities to achieve them.

For example:

GOAL: Expand Current Active Referral Base by 10 Percent in 2005

1. Identify Prospect List of at Least X-Number
2. Commit to Three Outbound Calls Weekly to Make Initial Contact
3. Commit to At Least One Personal Meeting with a NEW Prospect Weekly
4. Implement a Follow-Up Protocol
5. Drip-Market the Entire List Monthly

Then, as they say on the back of the shampoo bottle: Lather, Rinse, Repeat!

If you don't have a practice development plan, please give us a call. We help develop firm-wide plans, as well as targeted plans for specific practice areas and individual attorneys.

#4 Law Firm Business Killer -- Market Positioning

Improper (or Nonexistent) Marketing Positioning

"Market Positioning " is a popular jargon phrase tossed around by marketing gurus. Unfortunately, the phrase is seldom defined and frequently misunderstood.

Whether you know it or not, whether you like it or not, you "hold" a position in your marketplace.

Market Position may be defined as:

• Your Brand Identity -- or, how consumers PERCEIVE your firm. For instance, you may be perceived as a sharp up-and-comer, or a stodgy old-school has-been. Your actual brand identity (or market position) may or may not reflect reality. It may (and frequently does) conflict with your intended message.

Market Position-ing, on the other hand, refers to the process of defining how you wish to be perceived (your brand identity) and implementing a plan to influence market perceptions accordingly.

Market Positioning is the active process you undertake to define and influence your firm's public image (Brand Identity).

One of the tell-tale signs of improper (or nonexistent) market positioning is the unqualified or inappropriate lead. If your marketing efforts consistently produce inquiries from prospective clients who do not "fit" your firm's ideal profile, chances are you have a market positioning error.

One of my favorite examples comes from an estate attorney who complained of declining revenue despite a heavy volume of business. "I have plenty of clients, but they just don't fit the quality profile I need to be profitable," he said.

Asked to define that profile, he explained that he wanted to reach a more affluent client base with more sophisticated estate planning needs, willing and able to pay reasonable legal fees.

I asked about his marketing.

"Oh, we do a GREAT job of marketing. My seminars are always PACKED." Then he proudly added, "We've got it down to a science. You don't have to spend much. This flyer really PULLS."

I perused the flyer. It was indeed cheap. In fact, it appeared to be produced on a typewriter and reproduced on a faulty copy machine. By the thousands, on a flimsy GREEN paper. Distributed door-to-door by a troop of Boy Scouts. (I swear, I am not making this up!)

He went on to explain the "magic" of his homespun message, which he felt explained the flyer's tremendous power to generate response.

Well, his flyer certainly did "pull." Unfortunately, it pulled the wrong people. In essence, he was complaining about not eating trout for dinner, when he had clearly been out trolling for catfish all afternoon!

But more importantly, his flyer "pushed" as well (or better) than it pulled! It pushed his desired clients away from him just as surely as plopping a wad of dough bait into a trout stream would scare away the rainbows!

Further, he also noted that he rarely -- if ever -- received referrals from allied professionals such as financial planners or accountants. Really? No kidding!

This gentleman was the unwitting victim of his own, highly successful, market positioning campaign. He had defined, targeted, and succeeded in OWNING a very clear position in the marketplace. From those attending his seminars to those actively avoiding them (including the allied professionals observing the process)  -- EVERYONE knew this fellow's market position. Everyone but him.

If you think your firm may be suffering from an error in market positioning, please call us for assistance. We are experienced at helping law firms just like yours identify an appropriate position, and execute a plan to achieve it.

Click Here to Refer This Message to a Friend

#3 Law Firm Business Killer -- Fees

Inappropriate Fee Structures

Law firms are experimenting with a variety of fee structures. Most are trying to get away from standard hourly billing -- and those that are "married" to this old dinosaur are feeling competitive pressure from innovative firms offering alternative billing methods from value-based billing and flat-fees (even for litigation, see: http://www.bulldoglawfirm.com), to hybrid (or blended) fees (particularly for plaintiff's work).

Whether you are billing  hourly, quoting flat fees, or experimenting with other innovations, setting an appropriately profitable and competitive fee structure can be tricky. But getting it right is crucial. You won't stay in business if you continue to handle cases at a less-than-profitable fee. You won't be HAPPY working if your fee is only marginally profitable. But you may not HAVE any work if your fee structure prices you out of the market. As a consultant, I have seen all of these mistakes plague law firms -- regardless of size, practice area, or location.

Unfortunately, most lawyers do not realize their fee structure is inappropriate. Nor do they know how to structure their fees appropriately. Too many lawyers base their fees on

• Precedent (your hourly fee is determined by your position in the firm -- associate, partner or shareholder -- without regard to the nature of the work, the client's needs, or the marketplace),
• Hearsay (you base your fees on what you've overheard from colleagues at the latest conference or bar association social hour), or
• Ego (my work is "worth" this much -- to me!).

Agreed, the process of establishing a fee structure requires a bit of artistic maneuvering, but it truly is more "science" than "art." You fee structure should take into account ACCURATE measures of:

• Hard costs of handling a case (time, staffing, resources, and the time value of money);
• Soft costs associated with each case (firm overhead divided by the number of cases handled);
• Profitability goals;
• Current revenue in relation to revenue goals;
• Perceived value to the client;
• Market position; and
• Competitive pricing.

So, you may be asking, if this is the science, what is the art? Here are some of the more artistic factors affecting the appropriateness of your fee structure --

• Your personal "sales" skills -- how accomplished you are at attracting quality work, quoting profitable fees, and delivering on your promises (read: track record);
• The quality of your marketing -- if your marketing efforts are bringing you a steady stream of quality cases, then your fee structure will not be under as much competitive pressure;
• Your personal revenue requirements; and
• Your "quality of life" issues. For instance, many attorneys say they would LOVE 65-hour work weeks. Others want to be home by 5:30 every night, and keep their weekends free for family activities. Some want three weeks of vacation annually, while others want six, eight or more.

How do you know if you've "hit" the right mark?

See the discussion below regarding Financial Tracking and Management.

#2 Law Firm Business Killer -- Financial Tracking

Inadequate Financial Tracking and Management

One of the most pervasive problems that I find in working with law firms -- of all sizes, in all practice areas, and at all stages of practice development -- is inadequate financial tracking.  Let me elaborate.

Whether an attorney is also a CPA, holds an LLM in taxation, is a sole practitioner, principal in a small firm, or even managing partner in a relatively large firm -- regardless the level of education or the amount of money at stake -- very few attorneys have the data to answer the following essential questions:

1. What types of work are most profitable in your firm?
2. Where does the most profitable work originate in your firm?
3. What is your break-even point for a contingency case?
4. What is your average monthly revenue? Profit?
5. What is your average fee for any particular type of case? (not your USUAL fee, but your mathematical average)
6. What is the length of your sales cycle?
   (Or more simply, how much time passes from the date of initial contact to the date of payment? For contingency plaintiffs' work, you should know how long it takes -- on average -- for a particular type of case to go to trial in your jurisdiction. You should also know how long, on average, it takes you to negotiate a settlement. Estate attorneys should know how much time usually passes from the date of initial contact to document execution.)

If you cannot answer these questions, you may not be in "good" company, but you certainly are in plenty of company!

In fact, independent research shows that

• LESS THAN 30 PERCENT of law firms track their profit margin, and
• LESS THAN 45 PERCENT know what their operating profit is.

The reason that inadequate financial tracking is one of the Top Ten Law Firm Business Killers is this: It is IMPOSSIBLE (let me repeat, IMPOSSIBLE) to make good management decisions without accurate financial data. Decisions as mundane as staffing, officing, and technology acquisition require accurate financial data.

But truly strategic decisions, particularly in regard to your marketing and practice development, HINGE on your grasp of accurate financial data. Whether or not to pursue a certain practice area, case matter, or client rests on the profitability at stake. Where should marketing dollars be allocated? It is simply impossible to decide the proper allocation without a working knowledge of the financial risks and opportunities. Too many of these crucial practice development decisions are made on the basis of ego, fear, or habit.

As Deep Throat advised Woodward and Bernstein: FOLLOW THE MONEY!

No dangerous undercover investigation required. After all, it's YOUR money!

Comments? If you have questions about financial data tracking, please feel free to share them here.