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THE SOLO AND SMALL FIRM DILEMMA

Home / Typography / Business Law / THE SOLO AND SMALL FIRM DILEMMA
by CPLS PA
Business Law, Tee Persad

(Jobs, Pains, & Dreaming of Gains) By Tee Persad, Esq.

Over the past 10 years, we have been conducting informal research on the life of solo practitioners (“Solos”) and small firm practitioners (“SFPs”). Through this research, we have discovered that solo practitioners and small firm practitioners have similar job expectations, experience similar pains, and want similar gains. Therefore, they need similar resources and opportunities.

1. Solos & SFPs Have Jobs They Have To Do Every day

Solos and SFPs have functional, emotional, social, and business jobs that they do daily. But they tend to focus the majority of their time and effort on the functional jobs, such as file management and administrative matters (accounting, billing, vendor management, employee management, etc….), and on doing the work required on their clients’ cases. However, the emotional, social, and business jobs are also important and often get pushed aside because there is no time left to tend to these jobs, or for the acquisition of the knowledge or development of the skills necessary to handle these important jobs. Solos and SFPs routinely struggle with effectively managing the relationships with key partners, such as their clients, court personnel, opposing counsel, and employees. They also have to manage the stress associated with not enough money, management responsibilities, marketing, technology, and file management. On top of it all, they also have to keep themselves and their teams engaged so that productivity remains consistent and boredom or complacency does not set in. Finally, when the workday is done, they go home and have additional functional, emotional, social, and business jobs at home. Often times these “home jobs” are subordinated to the functional “work jobs.”

2. The Pains that Solos and SFPs Experience Everyday

Solos’ and SFPs’ pains show up on the financial and non-financial costs of running their practice, the barriers to maximizing their potential, bad feelings and thoughts about their situation, and the risks they are forced to take.

Financial Pain. Most financial costs are usually obvious and range from minor costs for Solos who operate out of their home to full-blown operational expenses for Solos and SFPs who operate out of a proper office with adequate staff, physical and electronic resources, and vendor relationships. The financial costs can consume up to 70% of a Solos’ or SFPs’ monthly gross revenue (averaged over a year) but normally falls between 40% and 60%, assuming a properly staffed office. While some Solos’ and SFPs’ expenses may be less than 40% of their average monthly gross revenue, they normally do not account for the non-obvious financial costs, such as opportunity costs. For example, they may be limiting their ability to attract clients who may be able to bring cases that are more lucrative, they may be missing internal referral revenue and other collateral forms of revenue sources that larger firms integrate as a part of their operations. In addition, they may be missing collaboration opportunities with other lawyers that they know, trust, and have a good working relationship with. When the obvious and non-obvious financial costs are factored into the formula, although the percentage they are taking home on average per month may be higher than 60%, it is likely a percentage of a pie that is relatively small. So, the effective monthly costs of their potential net revenue are usually much larger than they realize.

Pain from Roadblocks. Many Solos and SFPs run into roadblocks or barriers on a daily basis. The barriers to entry into their practice include financial and non-financial barriers. Financial barriers include, among other things, the high costs of rent, personnel, file management systems, supplies, and vendor services, all of which are critical to a productive practice. The non- financial barriers include lack of knowledge, skill, and adequate training in the following areas: leadership principles, management principles, business principles, psychology, communication, negotiation, and non-litigation conflict resolution. These roadblocks are limiting too many Solos and SFPs, causing them to miss out on opportunities that may have a strong positive impact on their practice and lives.

Pain from Bad Feelings. Many Solos and SFPs feel like a failure, incompetent, and not good enough to compete with larger firms. They believe that their lack of resources causes the roadblocks they have, that they are limited in their ability to grow and develop, and cannot be as competent as their colleagues in larger firms. After a while, they start to settle for what they believe is within their reach. These feelings and thoughts are limiting too many Solos and SFPs, causing them to miss out on opportunities that may have a strong positive impact on their practice and lives.

Pain from the Difficulties they Experience. Many Solos and SFPs face challenges that their colleagues in larger firms never encounter. First, they have to be owner, operator, CEO, marketing director, IT director, personnel director, firm administrator, and accountant for their practice. This can consume 30% or more of their time. Second, because of their limited resources, they are unable to handle complex matters in their areas of practice. They may also not have the resources to adequately prepare for court hearing and trials. The result is that they have a difficult time doing their functional job to the best of their abilities. Third, because they are bogged down dealing with the functional jobs of the practice, they have a difficult time taking advantage of opportunities to work on interesting cases, advance their practice, market themselves, and grow and develop into the lawyer they envisioned in law school.

Pain from Unnecessary Risks. Solos and SFPs sometimes have to take what cases they can in order to eat; whatever walks through the door. The alternative may mean that they get no clients and they stagnate and consider changing professions. So they choose to “wing it” or risk not being able to feed themselves and their families. The resulting pressures of daily practice may cause them to risk their reputation, compromise their ethical obligations, and increase their risk of committing malpractice, all of which may lead to depression, anxiety, alcohol and other drug abuse, alienation, and, at the extreme end, disbarment.

2 If a Solo grosses $100,000.00 per year and has a minimal overhead of 20%, her take-home net before taxes is $80,000.00. However, when you add in $50,000.00 of potential revenue loss for the same year, even if overhead was 40% of gross revenue, her take-home net before taxes is $90,000.00. Therefore, the value of the opportunity loss is $10,000.00.

3. The Gains That Solos and SFPs Want

Solos and SFPs are constantly searching for opportunities to obtain value or gain things they need to make their lives easier and more fulfilling; they also want to have their expectations met and are delighted when their expectations are exceeded. Some of the gains they consistently search for are:

A. To increase revenue

B. To have more time for client development

C. To have more sources of client development

D. To have resources to market themselves

E. To have clients who are nicer to them, pay their bills, & promote them

F. To have the administrative burden of practicing reduced

G. To reduce financial and non-financial costs of practicing

H. To have systems, processes, and procedures that help them be efficient

I. To be respected and trusted by their peers, clients, and judges

J. To have a well-earned reputation

K. To have the flexibility to work from remote locations in an effective manner

L. To have human resources to help them do their functional jobs

M. To have opportunities to contribute to a cause greater than themselves

N. To be a part of an organization that offers them a sense of community

O. To be a part of a family away from home

P. To recapture and maximize their time

Q. To improve their competence level in their practice area and beyond

R. To have more skills, tools, and resources

S. To reduce their stress level

T. To improve their personal and professional relationships

U. To go on a vacation free from the constraints of their practice

V. To be a part of something bigger them themselves

W. To have their expectations met and exceeded

X. To have certainty about their future

Y. To feel significant to themselves

Z. To have others recognize them as significant people

While there may be opportunities for Solos and SFPs to acquire some of these gains by partnering up with other Solos and trying to create a small firm environment where it is easier to pool resources, the smaller the operation, the less likely is it for these gains to be realized because the economies of scale are usually not available.

HOW DOES THIS RELATE TO YOUR PRACTICE?

(Exercises to help you do your jobs, relieve your practice pains, and get some gains you want and need)

Know your jobs & how to get them done the way they deserve to be done. I encourage you to take the time to think about the functional, emotional, social, and business jobs that you do every day, or that you have to do every day and do not get to. I recommend that you take a full

day to think about this by yourself and ask everyone who works for or with you to do the same. Then, get together to create a master list, then prioritize it and study. Ask your self and your team:

Are we doing all the jobs we need to do, to the best of our ability, with the resources we have available?

Then ask:
Is there a better way we can do our jobs by ourselves?

Then, finally, ask:

Is there anyone we can partner with who can help us do our jobs more timely, cheaply, effectively, and competently than we can do it?

This is a time-intensive exercise. The more comprehensive the list of jobs, and the more detailed the job tasks and responsibilities are, the more thought-provoking it will be, and the more you will get out of this exercise. Although this exercise is not particularly challenging, it deserves the time and effort of large blocks of time so that you can explore your practice deeply. This is not an hour or two-hour exercise. It is a day-long process that deserves your attention. This deep dive will give you the greatest insight into your functional practice and how it affects you emotionally and socially, and, how it affects how the business of your practice operates.

Know the pains you are experiencing and how to relief them without resorting to self-medication. I encourage you to think about the financial pains you and your firm are experiencing. Then, think about the non-financial pains. Be specific about the pains, when you experience them, and how frequently they appear. Think about the costs of running your practice, the barriers you face, the feelings you have, the thoughts you have, the difficulties you experience, and the risks you take. I recommend that you take a full day to think about this by yourself and ask everyone who works for or with you to do the same. Then, get together to create a master list, then prioritize it and study it. Ask your self and your team:

Do we have the resources to minimize or eliminate these pains without resorting to drastic measures that may cause us greater pain?

Then ask:

Is there a better way to minimize or eliminate these pains than what we have been doing or what we plan on doing?

Then, finally, ask:

Is there anyone we can partner with who can help us minimize or eliminate these pains more timely, cheaply, effectively, and competently than we can with our limited resources?

This is a very difficult exercise for several reasons. First, it forces you to confront yourself and your team in a bold and strong way. It forces you to look at your belief structure and how you experience life as a practitioner. It challenges your implicit bias and it helps bring awareness to your cognitive dissonance. Second, it forces you to see how these pains affect you and your team. Some of them are visibly cancerous and affect your practice in specific, but manageable ways, while others are hidden and chronic cancers that have the potential to kill your practice. Finally, it forces you to face reality and seek the help you need before it is too late.

Know the gains you want and need. I encourage you to think about the gains that you want and need. Examine your expectations, your team’s expectations, your client’s expectations, the courts’ expectations, opposing counsels’ expectations, your family’s expectations, and the profession’s expectations. Think about the savings that you would like to have. List the ways you measure success and what success looks like for you. Identify what will make your life easier and what would delight you. Note which ones are absolute needs and which ones are wants and note the difference. Be specific about what you want and need and why you want them or need them. I recommend that you take a full day to think about this by yourself and ask everyone who works for or with you to do the same. Then, get together to create a master list, then prioritize it and study it. Ask your self and your team:

Can we get what we want and need with the resources (time, financial, relationships, physical, personnel, strategic partners, etc…) that we have now?

Then ask:

Is there a better or faster way to get what we want and need than using our resources or using them the way they are being used now?

Then, finally, ask:

Is there anyone we can partner with who can help us get want we want and need more timely, cheaply, effectively, and competently than we can with our limited resources?

This is an exercise that improves your vision of your future self and helps you see “your ghost of Christmas future.” What would life be like if you had everything you wanted and needed? Can you actually identify what you want and need? Can you actually get what you want and need? When you start consciously thinking about what you want and need, the natural tendency is for you to focus on your life’s purpose and how your professional life fits within that purpose. You begin to think about leading yourself and others with a purpose. This could well be one of the first steps towards living a productive and fulfilled life and having a practice that serves you and helps you serve others in a way that not only benefits you and your clients but also others that are affected by your work. This may be the beginning of you realizing the dream of being the lawyer that you had when you were a law student.

I HAVE DONE THE EXERCISE, NOW WHAT?

Whether you are a Solo or SFP, once you have completed the above exercises, use what you have learned to improve your practice. You can do this on your own, with your team, or with a coach. If you put the time and effort into these exercises that they deserve, then you should see remarkable results on how you see yourself, your practice, and your role. You can also expect to notice shifts in your thinking and belief structure which will help you get more focused on what really matters. If you are satisfied with your progress, use these exercises repeatedly (at least once a year) to help you stay focused and on track.

If, after these exercises, you believe you need help, then seek out the help you need. If you choose, I will be happy to be your mentor and coach and help you through the process and give you other tools that will elevate your practice. Please feel free to reach out to me via email atattorneypersad@cplspa.com or call me at 407-647-7887. Another alternative is to make a dramatic change and consider joining a larger Firm that understands these issues and will help you maximize your potential.

CAN CPLS, P.A. HELP ME REDUCE MY PAIN AND GET THE GAINS I NEED AND WANT?

Our Firm’s value proposition is:

We help lawyers increase their focus, competence, and reputation by providing products and services that help stabilize their costs, increase their resources, minimize their risks, and remove barriers. We also provide them with a family of colleagues and staff, forming a community that supports them without reservation. The resulting benefits are that they increase their net take-home revenue (and start to gain financial freedom), recapture time (increasing their flexibility to learn new things and explore new things), and live a more balanced and productive personal and professional life.

We have designed the Firm with one purpose: “to provide an environment where each individual can thrive and optimize their potential.” We take great pride in serving our lawyers so they can develop their leadership abilities and technical knowledge to fulfill their purpose…to serve their valued clients. If you would like to explore being a part of our Firm, please feel free to reach out to me via email at attorneypersad@cplspa.com or call me at 407-647-7887.

We have focused our energies on designing, developing, and operating an organization that provides products and services to lawyers which help them do their jobs, relieve their pains, and gain what they want and need. Here are some of the products, services, and extra mile examples we provide our lawyers:

1. Firm Brand and Reputation – CPLS, P.A. is a trusted brand in the Florida legal community. The Firm has tackled large complex cases, including class action cases, represented foreign government agencies, handled high conflict and profile cases on behalf of divorcing parties and high profile criminal defense cases. Lawyers at the Firm represent international

industry leaders in several disciplines. Its lawyers include board-certified lawyers, retired judges, and lawyers with advanced degrees, all with years of experience in their fields.

2. Positive Firm Culture, Ethos, and Community – We do our best to bring in and retain positive, helpful, kind, hardworking, and competent staff members and lawyers. We do our best to maintain an environment where everyone is happy to be a part of our team and family and to encourage a sense of community and camaraderie between the members of the firm.

3. Managing Partner who Cares about Lawyers – As the Firm’s managing partner, my primary job is to help our lawyers be the best they can be. I work hand in hand with the staff to ensure the lawyers have what they want and need. And I work with the lawyers collectively and individually to help them as needed. Recognizing the value of the members of the Firm, I subordinate my personal interests to the interests of the Firm and its lawyers and staff.

4. Attorney Liaison – Lawyers have access to an attorney liaison, a licensed attorney working for the Firm who helps them when needed. This attorney helps with training and development for the lawyers and legal support staff, helps the lawyers integrate within our system, and is available to step in when necessary to help the lawyers out.

5. Administrative and Accounting Services – In addition to normal accounting functions, all client and vendor accounting matters are handled by an accounting team that is well trained and efficient. They handle all of the billings for the lawyers and work with them to improve collections and maximize their revenue. They provide lawyers with a bi-monthly accounting of all their receipts and expenses so the lawyers can be aware of the results of their efforts timely. They also provide monthly and cumulative reports for the lawyers to track their progress.

6. Client Services – From the minute a prospective client calls the office, a member of our Client Services team greets them with a smile and warm welcome. This team helps manage the clients’ relationships with the lawyer and their legal support staff, processes all incoming and outgoing mail, maintains the integrity of the clients’ physical and electronic files, manages the use of the office space, and assists with special projects. They work hand in hand with the lawyers, legal support staff, and administrative and accounting staff, to ensure that the lawyers’ jobs are done efficiently, timely, and competently. In addition, this team provides concierge services for lawyers.

7. IT Support – With a full-time IT expert on staff, all computer, phone and tablet issues can be resolved very quickly, reducing downtime. Also, the management of the Firm’s electronic systems is not left up to outside vendors.

8. Marketing Support – With a full-time marketing expert on staff, lawyers can have marketing materials developed to help them brand themselves and increase their client base. Promotional materials regarding the Firm, practice areas, and lawyers are available for the lawyers’ use.

9. Class A Office Space on Lake Eola – We occupy the 4th floor of the PNC Bank building located at 201 East Pine Street, Orlando, Florida. We have a beautiful reception overlooking the lake, 7 conference rooms, a training room, and furnished and equipped offices that are designed with the lawyers in mind. The office is accessible to its lawyers 24/7 and is staffed from 7 a.m. to 6 p.m. from Mondays to Fridays.

10. Professional Atmosphere – From the minute you walk into the office, you get a sense of the importance of professionalism and the impact on the Firm’s operations and effectiveness. From the physical layout to the professionalism of its staff, the Firm takes pride in projecting the importance of a professional environment and ethos.

11. Strong Organizational Structure – The organizational level of the firm’s resources, systems, tools, processes, and procedures is superior in the legal industry. From the minute you walk through the doors, you get the sense of the degree of organization and efficiency.

12. Efficient Systems, Processes, and Procedures – We have designed systems, processes, and procedures to help lawyers do their jobs from the initial potential client contact through the closing of a case once representation is concluded. Our processes and procedures help reduce roadblocks and obstacles for the lawyers and help them focus on what matters. The systems, processes, and procedures were designed to be mechanical when necessary and appropriate (e.g., standardized forms, scripts, templates), brain-like when needed (trained staff with knowledge, skill, and discretion to make good decisions when called for), culture like when the context changes (trained staff to understand the cultural nuances of clients, lawyers, court personnel, and vendors so that communication can be effective), and gymnast like when flexibility is important (trained staff who has the discretion to be flexible when required to get the job done).

13. Trained Staff – We have a trained staff of administrative, secretarial/para-professional, clerical, and client services staff whose functions are specialized to ensure consistency and reliability. When new lawyers join our team, oftentimes they bring their own staff members who are integrated into our system and trained to use our systems, processes, and procedures to improve their efficiency and value to the lawyers; often their productivity improves by over 30%.

14. Equipment – Our electronic system allows our lawyers to work anywhere on the globe that has internet access collaboratively with everyone else at the Firm. With access to our remote system, our lawyers have their organized files at their fingertips and can work when they want, where they want. With an assigned voice over IP phone, they can take their extensions with them anywhere and be just an extension away. Phone messages are converted into emails for their easy access.

15. Supplies – We keep the office stocked with the supplies needed to get the job done and to use in court to help lead the judges and opposing counsel. From file organization supplies to job function supplies, to presentation supplies, and form supplies, we provide all the supplies lawyers need to get their jobs done competently and timely.

16. Internal Referral Systems – Our internal referral systems ensure that all of our clients’needs are met and lawyers receive credit and are compensated for client origination. As lawyers speak at local, statewide, and national events, the Firm gets recognized and receives referrals

from time to time. In addition, the Firm actively markets on the internet. Potential clients from these sources are referred to internally.

17. Collaboration Opportunities – Lawyers are encouraged to collaborate on matters when necessary. This helps foster strong relationships and growth and development while ensuring that clients get the best representation possible. It also allows lawyers to collaborate on more complex and large matters.

18. Supplemental Passive Income Opportunities – The Firm has designed passive income producing programs that lawyers can participate in and supplement the income earned on matters they actively work on.

19. Coverage – When lawyers go on vacation or have conflicts in their calendar, other lawyers at the Firm are always willing to jump in and help out, as needed.

20. Malpractice Insurance – The Firm’s malpractice insurance policy covers all its lawyers.21. Lexis Account – Lawyers are assigned a Lexis account for legal research.

22. Clubs and Organizations – The Firm joins organizations that its members can participate in for networking, learning, and fun, such as the Chamber of Commerce and Top Golf.

23. Free CLE and CME Seminars – The Firm provides free lunch and learn seminars on Fridays on a variety of topics, including practice management, marketing, IT and technology, mental health, practice updates, case law updates, leadership, business development, and mediation strategies. Specialty seminars are held on other days from time to time.

These products, supplies, services, and extra milers help us help lawyers reduce financial pains by reducing their costs and increasing their resources. We also stabilize their costs, contingent on their production, thereby eliminating the pain of monthly fixed costs during months when they oscillate down in monthly revenue. In addition, these products, supplies, services, and extra milers help lawyers reduce barriers, manage their files more effectively, efficiently, and competently, manage their relationships with clients, opposing counsel, and the courts more proactively, and reduce their feelings of incompetence and failure, giving them hope of a brighter future. They also reduce risks of malpractice, stagnation, depression, and anxiety.

Another benefit is the lawyers start to see gains in their wants and needs almost immediately. Their costs are stabilized for the first time in their careers and are dependent on their production, so when their monthly gross revenue oscillates down due to external factors, they do not have monthly practice expenses that are overwhelming. Their revenue increases due to added time to dedicate to their clients’ matters, internal referrals, co-counsel opportunities, and collateral sources of passive or semi-passive revenue. This leads them on a path to financial freedom. These gains are compounded by the extra time they have to work on themselves and spend with their family. The result is their knowledge, skills, and competence increases, thereby increasing their value to themselves, their families, and their clients. This is made possible by the increase in resources, services, products, and learning and leadership opportunities. In short:

We help lawyers increase their focus, competence, and reputation by providing products and services that help stabilize their costs, increase their resources, minimize their risks, and remove barriers. We also provide them with a family of colleagues and staff, forming a community that supports them without reservation. The resulting benefits are that they increase their net take-home revenue (and start to gain financial freedom), recapture time (increasing their flexibility to learn new things and explore new things), and live a more balanced and productive personal and professional life.

CALL TO ACTION

It takes time, focus, and energy to read, digest, and use the information I have provided. If you took the time to read it, I am confident you will take the time to do the exercises. If you take the time to do the exercises, I am confident you will make changes to your practice and you will improve. If you are the kind of person and lawyer I believe you are, then you are someone who I would love to get to know better to see how we can be of service to each other. If that road leads to us working together in one capacity or another, I would cherish the opportunity. If it leads to you joining our team, I promise to meet and exceed your expectations. Call me at 407-647-7887 or email me at attorneypersad@cplspa.com when you are ready to take the next step.

Tee Persad, Esq.

Founder and Managing Partner

CPLS, P.A.

Attorneys|Consultants|Mediators

Bio: https://cplspa.com/team-members/tee-persad/ 

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