I posted some weeks ago about cultivating a habit of optimism: something which is increasingly difficult as the news gets worse, but stick at it. Keeping the morale of the team up should be one of a law firm leader’s main responsibilities.
Another responsibility, and this has to be linked in to that optimism, is to hold onto the long view. Short term solutions often seem to offer immediate relief to problems, but there is the very real risk of missing the wood completely as you concentrate on the trees.
Business planning in uncertain times is an article by David Hunt in Smith & Williamson’s Summer 2008 Professional Practices News was spot on. In it he identified two principal tasks: to reign in costs, and to seek opportunities.
Although the first of these is, in large part, obvious, Hunt adds a number of key riders
- service delivery (i.e. people) cost, so one way of cutting costs is to get rid of them. This is being done across the profession as law firm after law firm puts in place redundancy programmes. But, as Hunt notes, “change (redundancy programmes) may be and are expensive and can have a long term impact on a firm’s culture”. I would add that you need to know what you want to be as you come out of the downturn is also important.
- cutting discretionary spending offers an immediate opportunity to limit costs, but (again Hunt) “marketing, training, recruitment and capex become ever more critical in a downturn as they aid recovery and future expansion.”
And as for seeking opportunities, take the long view: “thought should be given to future as well as current revenues”. So consider
- lowering prices to win work (although I would add the caveat that there is a risk that teaching your client to buy on price makes only one party, the client, happy, and may have a long term impact on the relationship
- re-evaluate business development activity: build new contacts or markets and strengthen relationships with existing clients (back to Nick Jarret-Kerr’s admonition, which I linked to in my post Spending time wisely, back in early July, to get even closer to clients.