You’re not a businessman. You’re a business, man.
The words may come from Jay Z, but they underscore a key lesson I learned from small business expert and best-selling author Michael Gerber (The E-Myth, which is about the myth that most people who start businesses are entrepreneurs, when, in fact, they are started by employees who want to work for themselves) during my transformation from a lawyer to a business owner.
I had been practicing law for a generation when, in 2003, I began building my own San Diego-based firm that is now nine lawyers strong and thriving. It hasn’t been easy. My mindset had to change. Running a business is significantly different from practicing law. Lawyers, or at least successful lawyers, excel in several areas. Research. Writing briefs. Arguing in court. Jury selection. Meeting with clients. Discovery. And so on. Lawyers, however, are not necessarily experts in running a law practice, a business in which practicing law is but one aspect of creating a successful firm.
The key is that wise people—and successful business people—admit their shortcomings. They’re not afraid to say, “I don’t know.” They’re not frightened by the need to learn. Or, as Gerber wrote: “Contrary to popular belief, my experience has shown me that the people who are exceptionally good in business aren’t so because of what they know but because of their insatiable need to know more.”
To be good at this business of law, we must admit that we don’t know everything and to be not only okay with it, but embrace the unknowingness.
What are the important elements for people who start a business based on the skills they do best, such as practicing law?
- Organization and Management
- Quality Control
Having a vision for your business and managing your resources to meet that vision is paramount. It means writing your vision down. It means determining who your company serves. It means deciding what kind of employee will fit that vision and deciding what makes an ideal client. It means asking questions such as, where do you see yourself in a year? In two? In five? How do you keep current? How much money do you want to earn? Do you have a budget to help your company meet your vision? What services do you provide? Should you update your services? Should you eliminate services? How do you market your business? Does your website represent your firm?
These are just a sampling of questions that can help prompt your vision for your business.
Organization and Management
Sometimes those of us in the law can be our own worst enemy when it comes to handling our own legal affairs. Who is your accountant? Who incorporates your practice? Who files the paperwork for your business license? Do you need to file a trademark? Who are your employees? How are they being paid? Are you paying them in compliance with the law? Do you have pertinent policies and procedures in place? Your administration reflects the tools and people you have in place to effectuate your management vision and plan. They require constant attention.
Profit is the ultimate goal of any successful business, and how to earn that profit takes some planning. How much do you want to make and why? How much do you want to invest? Where should you invest? How much do you want to save? How often do you pay your bills?
Are you current? Do people owe you money? Should you hire an accountant to make sure your bills are paid on time?
Oh, and one more thing: pay your taxes. It’s a must.
Marketing is what creates the customer expectation for your business. It is your company brand, what you want the public and your customers to think about your business. Marketing comes in many forms, including social media (Guy Kawasaki’s The Art of Social Media is great for guidance) and volunteer work in the community. How do you plan to promote your brand? Through your website? A newsletter? Weekly emails? Here’s a hint: embrace technology.
Sales and marketing are not the same thing, and it is important not to confuse the two. Marketing is a subset of sales. Sales require the client to trust you, understand your service (or your brand) and have a need for your services. When need, brand and trust come together—you get paying customers. But you need to define what kind of customer you want by defining the right client. When I started my law practice, I said I wanted clients, but I did not specify the type of client. Now, I do. I want clients who appreciate my firm’s services and who pay in a timely manner. That small change in focus has done wonders for my bottom line. As a side note, as lawyers, we are required to have engagement letters when we are retained. This must be mandatory. No executed engagement letter, no services.
If you don’t produce, you don’t get paid. And when you first launch your business, you need to produce if you want to build your reputation. How much you want to produce needs to be determined at the outset.
We need to constantly ask clients how we are doing. How can we improve? How can we become better at our work? As human beings, we often learn from our mistakes. When those breakdowns occur, clarify why they happened and what you will do differently so it doesn’t happen again. The old adage “stuff happens” is not in the language of successful folks.
In short, being a good lawyer and being a good business person are different things. Great lawyers lacking in business and organizational skills are doomed to failure. Good lawyers willing to overcome their shortcomings when it comes to running a business, good lawyers who are willing to take a university extension course or seek others who have made the leap, are destined for success.
About the Author
Janice Brown is the founder of Beyond Law, and the founder of Brown Law Group in San Diego, CA. She can be reached at 619.330.1700 or email@example.com.
(Image Credit: ShutterStock)