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Asked and Answered

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

Q. I am the firm administrator of a 16-attorney firm in San Diego. We have six equity members, four non-equity members, and six associates. We also have four paralegals and six staff members. We are managed by a three member executive committee. Each month I provide the equity members and the executive committee with the same reports from our software system. They are quite numerous. The equity members and the executive committee complain that they get too many reports and they don't look at them while the non-equity members and the associate complain that they don't get access to any financial information. Do you have any suggestions?

Asked and Answered

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

Q. I am the managing partner of a five lawyer firm in Denton, Texas. We have the opportunity of acquiring a sole owner practice in a nearby city with a complimentary practice area. We have had one meeting and our firm is interested. We want to initially do a quick and dirty due diligence so see whether this firm is really a qualified opportunity. What sort of information should we ask for?

Asked and Answered

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

Q. I am the managing partner of a 12-attorney firm in Providence, R.I. In our recent partner meetings we have been discussing ramping up marketing. How much should we be spending on marketing?

Asked and Answered

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

Q. I am a partner in a 20-attorney firm in San Francisco. We have five partners. Two of the five partners are founders and the other three were made partners five years ago. From day one our compensation system has been an eat-what-you-kill compensation system based on a formula with two factors - working attorney collections and client origination. While the system worked OK for the founders, it is not working for the present firm. The newer partners are unhappy with the system and believe that it does not consider other factors that a partner contributes to the firm. Some of the partners are hoarding work, refuse to serve on committees, and don't want to do anything but bill. A couple of my partners suggested that we move to a totally subjective system. I would appreciate your thoughts.

Asked and Answered

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

Q. Our firm is reviewing its partner compensation system and one of my partners suggested that we incorporate realization rates. This term was new to me. Is realization the percent that we collect? Your comments would be appreciated by all of us.

Asked and Answered

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

Q. I am the owner of a 14-attorney firm in the western suburbs of Chicago. I am 45 years old and I started my practice as a solo 10 years ago. The firm focuses on business litigation exclusively. Like many law firms the name of the firm is My Name, LLC. The firm has grown rapidly and we have been successful. However, I am concerned that I should be building more of a "firm brand" and the firm is too much about me. I would appreciate your thoughts?

Asked and Answered

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

Q. I am the owner of a 14-attorney insurance defense practice in Baltimore. I started the firm 20 years ago after leaving behind my partnership at another firm. Of the other 13 attorneys, there are four non-equity partners and the rest are associates. I am 63 and beginning to think about retirement and how I am going to transition out of the practice. Two of the non-equity partners are well seasoned attorneys, have major case responsibility, and have developed solid relationships with clients. I have discussed equity partnership vaguely with them, but their interests seem lackluster and they have been non-committal. I would appreciate your thoughts and advice on what my next steps should be.

Asked and Answered

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

Q. I am the owner of a 20-attorney litigation firm in Seattle. The 19 associates are all in the same tier or category and are paid a salary plus bonus. Their time with the firm ranges from 1-15 years. I enjoy sole ownership but I realize that to continue to grow and prosper I must make some changes. I have recently lost several associates that I would have liked to have stayed with the firm. I am also getting stressed having all of the management responsibility since I currently make all of the decisions. Several associates have told me that the morale is low. I welcome your thoughts.

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

Q. We are a firm is a 15-attorney firm in Kansas City, Missouri. Our management committee is charged with the responsibility of determining partner, associate and staff compensation. Several years ago we switched to a competency based, goal driven system for partners, associates, and staff. The system requires self-evaluations, peer evaluations for partners and associates, and self-evaluations. This requires extensive performance reviews, tracking, scheduling, and documentation. We are using Excel spreadsheets and MS Word documents and having a hard time managing all of this. Do you have any ideas?

Asked and Answered

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

Q. I am a partner in a 12-attorney firm in Downers Grove, Ill. We have eight partners and four associates. We are managed by committee of the whole - all partners are involved in all decisions. We have been considering moving to an executive committee. How do we set it up?