Law schools do not generally teach anything about business, as opposed to business law. As a result, lawyers learn about business legal forms and contracts, but nothing about the non-legal imperatives of running a business like corporate finance, marketing, or corporate strategy. Furthermore, as members of an inherently conservative profession many lawyers resist engaging in any topic that goes beyond the four corners of their legal brief (“I only give legal advice”).

This is highly problematic for business, because every legal problem comes within a business context, and lawyers who are not willing or able to understand that context cannot give good advice; Brandeis J.’s dictum is as applicable with respect to business knowledge as it is with respect to economics, and there remains a significant knowledge gap between the practice of law and the practice of business.

In some cases lawyers address this knowledge gap by specializing not only in a particular field of law but also in a particular industry, and in this way they develop industry expertise in substitution of more general business knowledge. At the same time the scale of the knowledge gap can be masked by the natural hubris of the legal profession—lawyers who are at the pinnacle of every information and decision making-tree they are associated with can suffer from the illusion of knowing more, not less, than their clients.

A great deal has been written about alternatives to lawyers billing by the hour, or lawyers working from home instead of at a desk in a big law firm, but in my view these topics are relatively trivial. A much more significant topic is bringing business financial and strategy tools into the practice of law in order to develop a multi-disciplinary approach to the delivery of legal services.

In a litigation context for example the focus of lawyers should not be on winning their client’s case but on solving the underlying business problems—the disputes which were the reason clients came to them in the first place. One very simple example of this would be to compare the cost of litigation with the cost of buying the other side’s company—if the two numbers bear some similarity then a rare opportunity for a litigator to participate in value creation instead of value destruction may exist.

Business clients want to know how much their case will cost, how long it will take, what the risks are, and the probable result. These four basis elements—cost, risk, time, and reward, are the foundation of the financial analysis of any business proposal, and there is no reason why lawyers cannot make reasoned and reasonably reliable assessments of these elements in any given legal context—the law is no more uncertain than many projects undertaken by business, and in many cases is substantially more certain.

Once we have attached numbers, or a range of numbers, to the four elements then we can financially model them the same way we can model any other business proposal. We can start with a simple spreadsheet comparing cost to risk-discounted reward, or add time to give a net present value calculation (which will show how high the reward would have to be to justify the risk over time, all other things being equal). Nor does it stop there—we can go on to decision tree modeling to assess the value of certain choices and options, and use sensitivity analysis or tornado diagrams to identify the assumptions in the model around which most of the risk in the model revolves; this in turn allows us to go back and further assess the assumptions.

I am aware of no lawyers anywhere in the world who consistently adopt this multi-disciplinary approach in their practices. Discovering such lawyers, and developing a framework with readers to put some flesh on the bones of this theoretical multi-disciplinary approach, is a key objective of this Journal.

 

Revealing the Secrets of Successful Practice Management

What is the best investment for your practice or business?

When you decided to have a practice of your own, you knew that you had a limited amount of money available to buy all your equipment.  Every practitioner has these thoughts, but you will find overall everything costs more by the time you open your doors for the first time, there is always something you have forgotten. Feeling very nervous, waiting for the phone to ring, hoping it`s a patient. You feel you have done as much as you can to get patients with advertising, and telling all your friends, when you intended to open your door for the first time.

When the telephone doesn’t ring, you start to think “have I done the right thing in setting up on my own?” Knowing if you were working for someone else you would be getting patients from a practice that has been established for a number of years, and getting a regular income.

But you know yourself you are well trained in your profession, and if you had been working for someone else you would still be getting good results from the treatments you were giving.

You have every right to be where you are, in your own practice.

The only way you are going to be successful is by getting people to come through your practice door. You feel that your college did not cover too much on the practice management skills, but just sitting there in your own practice waiting for the phone to ring, is not the answer. All practitioners go through the same feeling. To be honest I had four patients the first week. I even went to a telephone box to ring my practice to see if the phone was working! So you feel, “what do I do?”.

I have written two e-books to cover what you have been feeling, which cover one of your problems by getting new patients to come to your practice, and to keep them coming until they are well again, and how to talk to them to send referrals to you.

But many practitioner don`t know how to talk to people when they first phone your practice, this is covered in the practice management programmes e-books, because if you worked for someone else before you set up on your own you didn’t have to do this. It is important what you say when someone phones your practice, if you say the wrong things they will not book in!

Something which is very important when being a practitioner on your own, is that all regulating bodies say that you should offer the a patient a chaperone, so when a person does phone for an appointment, ask them if they want a chaperone, if they do, they must bring one with them. Please read your regulating bodies do`s and don`ts.

Other ideas included will help you to have a successful practice, as there are many short cuts when setting up in practice to save you money and time in these two e-books.  In the past all these situations have happened to me, and all I have learned about successful practice management are in these two programmes.

Choosing the right location for your practice, how to get growth in your practice, insurance claims, how to get known in your town or city, choosing the right receptionist, charging the right fees, and much more.