High Cost Legal Partners - Low Value Work?

Are your costs too high for the tasks that you do?

What percentage of your time could you save if you trained a junior person to the job well?

Would the answer be 10%, 20% or 40%?

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If the answer reveals that there is work that can be done by a properly trained junior then it makes sense to train the junior to do it. That’s because it then costs the firm less to get the work done. (Unless the client is willing to pay more for the senior person to do the work which may be what the client wants).

If a law firm were a supermarket and costs were running 10%, 20% or 40% higher than necessary then you can guess that those costs would be discovered and cut.

Under-delegation is a problem because costs are higher than they should be. And this causes several problems.

  • Profitability. High costs mean that you are not as competitive as you can be. And you may be earning less profit than you could. Both of these can impact on your firm’s ability to survive. Because if another firm becomes more competitive than you and takes your business it’s a problem. And if you are making less profit than you should, it’s a problem because you have less money to put in your pockets and less money to invest.
  • Skills. When high priced people do lower value tasks it means that they do not develop themselves and they also prevent others from developing. If your whole business is based on skills and you continually blunt it then you are heading for a fall.
  • Morale and Motivation. If senior staff are doing boring tasks then they get bored. Their morale and motivation suffer. Likewise if juniors don’t get the chance to develop as fast as they want or can, then they lack motivation and soon perform worse. As being a lawyer is a vocation, the lack of motivation and morale is a fast track to “We’re no worse than anyone else” level of performance.
  • Underinvestment. If you are a senior person doing junior jobs then you are “too busy”.  But you are too busy with the wrong type of work. If you can free up 40% of your time then you can do the business development tasks that are so important.

So if coaching and delegation is so important then why don’t most firms do it systematically?

 The “I prefer to do the work myself” Partner is one answer. But it’s not a good one.

The real answer is because the measurement and reward systems in place do not do enough to encourage delegation and they reward other things in its place.

If a Partner is rewarded significantly for personal billable hours they are more likely to keep work to themselves, under delegate and are less likely to look for operating efficiencies through delegation.

Secondly, if a Partner is not held accountable for the efficiency of the engagement costs then he is not motivated to make every engagement more efficient and therefore more profitable.

Thirdly, in the short run, coaching a junior to do a task takes more time. So there is a strong temptation not to do it. The problem exists because firms do not have a measurement tool that focuses on coaching.

Fourthly, if the Partner does coach junior staff well so they can do tasks he used to do then what does the Partner then have to do to replace that work? The answer is business development, coaching, marketing, strategic planning, true Partner level work and generally things which are more difficult!  

There are often excuses too. For example, Partners may say that there is insufficient Partner level work in the market place to find. But that is precisely the high value and high profit work that Partners should be bringing to the firm. If it takes more time to find it, so be it.

The worst outcome is to have expensive Partners doing low value work and not do anything about it.

So what do you do about it?

Here’s a three step programme you can use to solve the under delegation problem.

  1. Profitability Measurement
  2. Tracking and Rewarding Coaching
  3. Scheduling Process

 

Stage 1 – Profitability Measurement

It is important to make Partners responsible for income per Partner rather than income a Partner personally bills. This means that the Partner has a responsibility for his team and the costs associated with his team’s engagements. By working out the costs and the profit for engagements it is then possible to compare each Partner’s profitability. It also focuses their mind on operating efficiencies through delegation, alternative solutions and even time management. This process highlights the type of work which is most profitable.

Stage 2 – Tracking and Rewarding Coaching

Because coaching is often deferred, leading to under delegation, the firm should introduce a management tool to assess staff engagement experience at the end of each piece of work.

This management tool can be a form which enables all staff to rate the engagement experience of staff supervised by the Partner in charge of that engagement. This is then sent to the Managing Partner. Over the year the forms will enable an aggregate score for each Partner’s supervision and coaching to be compared against other Partners and for the office as a whole.

With a measurement tool in place it will encourage coaching, mentoring, transferring of skill and delegation.

Step 3 – Scheduling Process

Most of skill building in the practice comes from the type of engagements that staff are involved in.

The scheduling of engagements is where the under-delegation problem can be addressed. It’s where the trade off of coaching, skill building, and Partner requests for particular staff all come to a head.

The scheduler must have the power to ensure that the right people are scheduled for a task which allows skill building and delegation. If the Partner always gets who he wants, there is the chance that it is always the same people who will always do the same things.

Indirect ways to solve under-delegation.

It is possible for senior Partners to set their fees higher and higher, in effect testing the market for their personal value, which can lead to engagements then being delegated for those clients unwilling to pay top whack for Partners. This is a way of down selling which can be effective in gaining higher profits for Partner work and helping skill transfers.

With Partners being evaluated more and being set personal targets and development plans to find more lucrative work they are also inclined to want to delegate work. That’s because they need more time to find the Partner level work.

Working as a team to solve under-delegation it is possible to find best practices and introduce systems and manuals which assist in the coaching process. This is because as things get documented experience is shared.

Ask yourself;

  • If under-delegation exists in your firm?
  • What would happen if you could eliminate it?
  • What approaches are right for your firm to eliminate it?
  • What happens if you do nothing?

Please email me boyd@greatlegalmarketing.co.uk  for your Partner Coaching Measurement Form.

 


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