It’s time to challenge the widespread belief that you can’t predict future business. Whether tacitly or explicitly, most lawyers probably agree with Tom Wallerstein‘s assertion that “The major disincentive to growth is the inability to predict future business.”
Under the title “From BigLaw to Boutique: Scaling Up and Down” in the March 8 edition of Above the Law‘s Small Firm Weekly, Tom presents a cogent analysis of the tensions between “hire now and risk not having enough work” and “wait to hire and burn everyone out or leave billable hours on the table.”
The “when to hire” problem is not new; firms have never felt comfortable hiring new lawyers until the work actually materialized. The range of solution options Mr. Wallerstein considers, however, is limited by the foundation assumption that you can’t predict future business.
Just because law firms traditionally haven’t predicted business reliably doesn’t mean it inherently can’t be done. It can be. We’ve taught thousands of lawyers to do it successfully.
Law firms can’t predict future business now because:
- They’ve never had to, so they haven’t tried to
- Marketing/sales efforts are random, unfocused and largely reactive
- Their “sales force” is part-time, volunteer, untrained and often reluctant
- They pursue individual companies instead of entire industries
- Their sales approach is solution-centric instead of decision-centric
These all result from of the Golden Age of Law Firms, a 25-year boom market for legal service, during which enough business came in each year for everybody to do well and grow without any real method or skill. If you make only two changes, i.e., reverse the respective values in numbers 4 and 5, you can create a reliably predictable business stream. If you change the other three, you’ll also affect speed and magnitude.
So, let’s look at our pivot points #4 and #5 above:
4. Don’t target companies. Focus on an industry. Some companies are rising, some are falling, some are flat, but somebody is always buying in any industry. Plus, whatever problem you solve, there will be a steady supply of companies who experience it. (I rode a single problem in the law business for 20 years; I’ve moved on, but it’s still there for someone else to base a business on.) Communication channels are organized vertically, i.e. by industry. Why engage with one person when you can engage with thousands, or millions?
The key is “owning” a meaningful industry-specific business problem by using industry media and social media to establish thought leadership that causes stakeholders in your problem to engage with you.
Here’s the progression:
- At any moment, a percentage of companies will be experiencing that problem.
- In turn, a percentage of those will be engaged with you in a (virtual) conversation about it.
- In turn, a percentage of those will agree with how you think about it.
- In turn, a percentage of those will contact you to discuss it.
The last bullet constitutes your bridge from marketing to sales. Which leads us to #5.
5. Eliminate “No-Decision.“ In 30% of selling situations, “no decision” prevails. Don't try to see more prospects; get decisions from the ones you have. Read our free e-book, “No Decision: The Blind Spot That Prevents Lawyers from Doubling Their Income.” Unless the consequences of the problem you own are defined specifically, and declared unacceptable, there will be no decision. You must engage a simple interaction to facilitate your stakeholders assessing the consequences. If you don’t, your chances of getting a decision are very low.
If you do these two things well, you’ll create a reliable and predictable source of clients and revenue. Then, you’ll be free to abandon fear-based inaction in favor of investing in your future. I agree with Tom Wallerstein that
“There is no question that the single biggest challenge facing most firms, big and small, is generating new business. A firm’s ability to generate business is always going to be the most important factor in determining if a firm thrives or fails.”
The difference is that we’ve already proved that it doesn’t have to be determined by luck.
RainmakerVT offers interactive virtual training to guide you through this transformation, corresponding to the superscript references:
1) Target industries, not companies:
- Creating a Marketing Plan That’s Actually Useful
- Profiling Your Optimal Audience
- Using Media Power to Penetrate Markets
- Your Media Campaign
2) Thought Leadership:
- “Door-Opener”: Associate Yourself With Issues that Drive Demand
- Become a "Thought Leader": Uncover a Business Issue that Opens Doors for You
- Draft a Crystal-Clear Message that Attracts Prospects and Repels Time-Wasters
- Write High-Impact Articles--In 30 Minutes
- Expanding Your Network Without Leaving Your Desk
3) No Decision