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  • July 24, 2013 | Practice News
    Best Practice: Law firm succession strategy when owner wants to keeping working

    Asked and Answered

    By John W. Olmstead, MBA, Ph.D, CMC

    Q. I am the founder and solo owner of a small firm in Memphis. Besides myself there is one non-equity partner and four associates. We handle the transactional and litigation work for small and large business concerns in the Memphis area. I am 60 now and would like to begin slowing down over the next five years, but I I don't want to retire completely. Over the past few years I have focused more on client development as opposed to serving clients and have turned over much of the client service work over to other attorneys in the firm. While I would like to receive some compensation from my sweat equity - I also do not want to place an unreasonable financial burden (large cash buy-in/buy-out) on others in the firm. Legacy of the firm is important as is a place to continue to work and contribute - so I really would like to transition the firm internally to deserving attorneys employed by the firm. What are your suggestions concerning how I might accomplish this?

    A. I often ask attorneys - are you more a lawyer that wants to lawyer or a business person that enjoys and wants to focus on the business of law. It sounds like you, as you approach retirement, would like to spend more of your time "finding" rather than "minding" or "grinding". You might want to consider the following:

    1. Get a feel for the value of your firm. If you have been taking home say $400,000 per year - using that as a starting point for your rough value figure if you were to sell your practice to outsiders. Would you be willing to discount to transition the members of your current team? If so, maybe that figure might be $200,000 - $300,000.

  • July 18, 2013 | Practice News
    Chief Justice Kilbride announces names of applicants to fill vacancy in 9th Circuit

    Chief Justice Thomas L. Kilbride announced on Thursday the names of six attorneys who have applied to fill a judicial vacancy in the Ninth Judicial Circuit. The vacancy was created by the retirement of Fulton County resident Circuit judge Edward R. Danner.

  • July 17, 2013 | Practice News
    Appellate court: mooning the boss a fireable act

    In case you're wondering — and we know you are — mooning your boss is "good reason" for termination.

  • July 17, 2013 | Practice News
    Best Practice: Metrics and Dashboards for a Personal Injury Law Firm

    Asked and Answered

    By John W. Olmstead, MBA, Ph.D, CMC

    Q. I am the managing partner of a three attorney personal injury plaintiff firm in Indianapolis. We have a total of 600+ open PI files. What are some of the key financial metrics/indicators that we should be using to manage the practice?

    A. From your case count it is obvious that you a managing a high volume practice. In addition to selecting the right cases, managing your inventory (case portfolio) is crucial as is managing and monitoring the effectiveness of your marketing investments. Here are a few metrics that you might consider incorporating into a one page report with trend line charts. You can design the report in Excel and pull the numbers from detail reports from your case management system:

    Plotted by Month

    • Fees Collected by Case Type 
    • Number of New Client Appointments Made
    • Number of New Client Appointments Kept
    • Number of New Cases Conditionally Signed
    • Number of New Cases Accepted/Opened
    • Number of Later Case Dumps
    • Ratio of New Cases to Dumps
    • Number of Demands
    • Number of Files Closed
    • Number of Open Cases - by Case Type
    • Total Open Cases
    • Number of Open Cases Per Lawyer
    • Average Age of Open Cases (Turnover)
    • Expected Fees - Value of Case Inventory by Case Type (Expected Value)
    • Total Expected Fees - Value of Total Case Inventory/Pipeline
    • Average Case Fee
    • Marketing/Referral Source - No of cases opened each month by referral source.

    This will get you started.

  • July 11, 2013 | Practice News
    New Limits on Subject Matter Waiver of Attorney-Client Privilege

    The Illinois Supreme Court recently adopted Illinois Rule of Evidence 502 and issued its Center Partners decision. Together, they set important new limits on the doctrine of subject matter waiver of attorney-client privilege, establishing that waiver only happens when there are intentional disclosures designed to give the disclosing party an unfair tactical advantage in litigation. Here's an analysis by Gino DiVito and coauthors from the July IBJ.

  • July 11, 2013 | Practice News
    ISBA Statehouse Review for the week of July 11

    ISBA Director of Legislative Affairs Jim Covington reviews legislation in Springfield of interest to ISBA members. In this episode he covers Juvenile Court Act (Public Act 98-62), Raising the age of juvenile court (Public Act 98-61), Concealed carry (Public Act 98-63) and Real estate documents and thumbprints (Public Act 98-0029). More information on each bill is available below the video.

    Juvenile Court Act. Public Act 98-62 (Tracy, R-Quincy; Clayborne, D- E. St. Louis) amends the “continuance under supervision” section (Section 615) to track the procedure followed in adult criminal court. It does the following: (1) Leaves current law so that a case may be continued under supervision before a finding of delinquency with the approval of the state’s attorney. (2) Amends § 615 to allow the court to continue case under supervision after a finding of delinquency. It adds the same criteria from the supervision statute in the Criminal Code that the judge must consider before ordering supervision. Regardless of when this happens, current law is retained that prohibits a case from being continued under supervision for any forcible felony, a Class X felony, and first-degree murder. Effective January 1, 2014.

  • July 10, 2013 | Practice News
    Best Practice: Law Firm Pipeline - A Key Financial Metric and Indicator

    Asked and Answered

    By John W. Olmstead, MBA, Ph.D, CMC

    Q. I am the managing partner for a 16 attorney firm in Miami. I am new in the job and am trying to learn all that I can about law firm financial management. I have recently read several law firm management articles that have referred to "Pipeline Management". What exactly does this mean and what is the implication for law firm management?

    A. Pipeline management is a term used in the management consulting profession to refer to the process by which you continually evaluate your active opportunities (prospective clients to booked clients) for their balance of QUALITY and QUANTITY. The goal is to continually stay on top of the overall health which is a full pipeline. Pipeline management allows client relationship managers to more accurately forecast fee revenues, better staff and manage client engagements, and close more client business.

    I often also refer to Pipeline management in law firms in the context of using financial dashboards by which the individual charged with financial management responsibilities is continuously aware of significant changes in the firm's Pipeline (from prospects to cash): 

  • July 3, 2013 | Practice News
    Best Practice: Law firm managing partner compensation

    Asked and Answered

    By John W. Olmstead, MBA, Ph.D, CMC

    Q. I am one of the founding partners in a 27 attorney law firm in San Antonio, Texas. We have four equity partners, six non-equity partners and seventeen associates working in the firm. We focus totally on litigation. Each of us four equity partners have equal ownership percentages and since day one (20 years) have divided firm profits equally along those lines (25%, 25%, 25%, 25%). We each put in the same amount of effort and work - but since I am managing partner - my fee collections are much lower than those of the other three equity partners and I am concerned that they may feel that I am not carrying my weight since my fee collections are lower. How should this be handled in our compensation system?

    A. This is a common question that we hear often. It sounds like you are still allocating income in the same manner that you did when the firm first started. Often when a firm grows the partner compensation system needs to be reexamined when and if partner roles or contributions change. As the firm has grown I suspect that your time spent on management activities has grown as well. I, as well as many other legal management consultants, believe that firm management (running the business) is as important as generating client fees and should be so considered in partner compensation systems.

    We have numerous law firm clients where at least one or more of the equity partners "run the business" and do not provide billable client services at all.

  • July 1, 2013 | Practice News
    Supreme Court amends rules to expand mediation in child custody cases and to improve language access for litigants in mediation

    The Illinois Supreme Court announced Monday that it has amended rules that would expand mediation for child custody cases to include requests by a custodial parent to move a minor child to another state.

    Mediation programs for child custody and visitation cases have been a requirement for each judicial circuit in Illinois through Supreme Court Rule 905.

    1 comment (Most recent July 2, 2013)
  • July 1, 2013 | Practice News
    Applications sought for U.S. magistrate judge

    The Judicial Conference of the United States has authorized the appointment of a full-time United States magistrate judge for the United States District Court for the Central District of Illinois. The official location for the position will be Peoria, Illinois. Full-time magistrate judges are appointed to eight-year terms of office by the judges of each respective United States district court.