How to Manage a Small Law Firm

Feb 10, 2021

Learning how to manage a small law firm is often regarded as easier than learning to manage a larger law firm since there are fewer people, departments, and resources. Yet, this isn't necessarily true. Law firm management for a small law firm is often more difficult because one person is responsible for managing each employee, human resources, and making all the decisions related to the management and operations of the firm.

For many small law firms, this person is often the attorney who founded the firm. In addition to the business management side of law firm management, the attorney often continues to practice law because, after all, that's how the bills are paid even if there is at least one other attorney in the firm.

That is, of course, a lot of work. It can also be enough to make anyone feel like they're going crazy since practicing law and managing a small law firm are two separate roles, especially as the firm's business grows. In this blog, you will learn more about your options related to learning how to manage a small law firm without going crazy as well as some helpful law firm management tips.

Small Law Firm Management Options
Most small law firms start out with one thing in common: their founding lawyer is also the manager. You may still be in this phase even if you are bursting at the seams with clients, prospective clients, and even if you have at least one other lawyer and/or an assistant. We know that it can be hard to let go. Going to law school doesn't necessarily teach you the ins and outs of how to manage a small law firm. You learn by doing. While you can continue to do it on your own, it does take away from precious billable time or it can take away from your precious personal or family time. If you truly enjoy law firm management and business development, it is important that you understand best practices and that you also understand the KPIs that worst best for your business. A small law firm management consultant can help you get on the right track so that you can continue down the path of success.

Another option is to outsource one or more of the law firm management functions for your small law firm. You can, of course, start with just one area if the thought of outsourcing makes you nervous. You should choose a provider or company that is reputable, has great references, and has a history of working within the legal community. One of the benefits of outsourcing is that it is less expensive than hiring an employee. If you aren't sure where to start, RJH Consulting can help!

You can also consider hiring someone part-time or full-time to handle some or all of the law firm management functions. For example, you hire someone specifically to handle all of the billing and accounting for the law firm. Or, perhaps, you hire someone on a part-time or full-time basis to handle all of the firm's law firm management needs. This person would report to you. You would oversee them while also doing what you do best: practice law.

How to Manage a Small Law Firm: Top Tips
We are going to skip some of the more common tips that are included in all law firm management lists related to billing your clients at the same each month (they really do not like surprise bills) and how you can and should look around to find the best deals with vendors. Instead, we want to touch on some topics that aren't covered very often.

Law Office Procedures Manual for Small Firms
Even small law firms need a law office procedures manual. This is more than a list of dos and don'ts for your employees. It is a training guide and reference manual. If you aren't in the office and there is a question about how to complete a basic task, a law office procedure manual should be able to answer that question for your employee. The purpose of this manual is to walk an employee through how to do basic office tasks. It isn't necessarily specific to every duty for every employee. That is covered in each employee's training manual. However, it should cover every basic task for the law office itself. Every person who works in your small law firm should know how the office operates.

Cloud Computing for Small Law Firms
Cloud computing for small law firms became essential the minute COVID-19 happened and shut down the world. We do recognize that there are still a few hold-outs. If you use Office 365 or Google Docs for business or personal reasons, you are cloud computing. All small law firms must have cloud computing policies in place. The duty for tech competence is firmly established. More specifically, you must also talk with your employees about cloud computing and where client and firm documents must be saved (i.e., can they save copies to their personal clouds or only to the firm's cloud?). Digital discussions are a must.

Cloud Storage for Small Law Firms
Similar to the previous section, cloud storage is also essential for small law firms. It not only allows you and your employees to work remotely because of the pandemic, it also enables you to back-up your files and your data. If you use Google Drive, DropBox, OneDrive, or Amazon's unlimited photo storage that comes with your Prime account, you are accustomed to using cloud storage. The key here is security. When it comes to the data of your small firm and your clients, there is nothing more important than security. You must talk with your employees about cloud security, such as not sharing their user credentials and using secure passwords. The FBI recently warned of a concept known as vishing (voice phishing, an attempt to cajole a user's sensitive information out of them) attempts against businesses.

Law Firm File Management Checklist
If you're not relying on legal case management software for small law firms or if you're more comfortable running redundant systems, create a law firm file management checklist. A law firm file management checklist walks the person using it through each required step to open and set-up a case. It also explains, step-by-step, what needs to be completed when the case closes.

Lead Qualification Checklist Process for Small Law Firm
Not all leads are qualified. To help determine which leads are qualified, create a lead qualification checklist process for your small law firm. Consider the successful cases for your practice areas. What did they have in common? How would you take these traits and break them down into checklist form if it were possible? Then, consider the cases that you remember saying no to that really stick out in your mind. Also, think back to clients that you know that you should have said no to and yet took. What was about those that were red flags? It's important to include the negatives so that you do not take on cases that make you miserable or that aren't profitable (unless you want to take on pro bono work). A lead qualification checklist can make it faster and easier to sift through leads to determine if they are qualified or if you should say no.

Empower the Roles in a Small Law Firm
While you are required to supervise the nonlawyers who work for you, it is also important for to empower the roles in your small law firm. Make sure that everyone has the power they need to do their job. Yes, it is your duty to supervise. That does not mean that you need to do every single thing or need to authorize every single thing. As you get to know each person and their abilities, allowing them to do what they do well gives you the freedom to do their job. By empowering them in their role in the small firm, it shows you trust them. They will be happier as well.

Learn How to Manage Your Small Law Firm
Need help learning how to manage your small law firm? RJH Consulting helps small law firms find the perfect solutions to better embrace law office management to meet and exceed their goals. To learn how we can help your small law firm, schedule your free consultation now.


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