Business Planning for Practice Groups

The keys to developing and implementing a successful plan are to keep the plan relatively short and to the point, verify that all members understand the plan and their role in achieving it, and update the plan semi-annually to annually.

To focus members of a practice group on strategic needs and plans, firms should conduct a Practice Group Assessment and evaluate the practice group's current position.

A Practice Group Assessment consists of a practice group analysis, a market/client profile, a performance profile, a competitive analysis, an internal analysis and identification of key trends. The assessment is best done in a group meeting to discuss these issues. The practice group can then establish its goals and develop a corresponding business and marketing action plan.

Practice Group Analysis

The practice group analysis is the identification of practice areas and specialties the group offers including the range and depth of capacity in each area. To develop this analysis, the members need to look at such matters as:

• the practice's strengths and weaknesses
   
• those areas which are highly developed
   
• what areas are missing
   
• which areas are provided by other firms and therefore cause price competition
   
• the type of expertise missing among associates
   
• any age or experience gaps that may hurt the group's ability to service clients in the future
   
• how the group will gain required expertise in the future
   
• retirement of key members
   
• the changes or additions required in the professional staffing

1. a major business generator within the practice;
    
2. an egotistical partner who needed a “title” to differentiate himself or herself;
    
3. an under-productive partner who had time and interest in management (but not necessarily the skills or credibility to manage); or
    
4. a partner with a genuine interest in marketing and business development.

• Overall leadership and direction for the group, including strategic planning
   
• Work acceptance, workload management and lawyer utilization
   
• Quality control
   
• Training and professional development
   
• Forms, systems and procedures
   
• Financial management
   
• Knowledge management, and
   
• Business development.

• Credibility – Credibility is an absolute necessity for any leadership position. It is especially needed in a firm where practice management is a relatively new concept. This is why taking an under-productive partner and making him or her a PGL fails so miserably. The PGL must command respect, at least in terms of practice expertise, experience and integrity. It is preferable that the PGL also have credible leadership abilities, though the truth is that in some firms, the culture has been so individualistic (and autonomous) that there have been few ways to develop or demonstrate these capabilities. He or she should have vision for the practice and a track record as someone who follows through on his or her commitments.
   
• Integrity – The PGL should be perceived as fair and willing to put the practice's interest above his or her personal practice. There will be occasions where the PGL must take action to promote the good of the practice, which may not achieve equal benefits for all of the individuals within the practice. At times such as this, the success of the PGL will hinge on his or her ability to engender trust. Group members will be more willing to take risks if they trust the PGL. This includes feeling encouraged to try new things and supported in failure. A PGL with these qualities will also engender loyalty.
   
• Organizational skills – This is essential since most PGLs also maintain a significant billable practice. The PGL job is a big one and could easily be full-time, but most firms are not ready to allow an attorney who is usually one of their busiest, most valuable producers to devote so much time. The PGL is both a coordinator in the establishment of an effective practice infrastructure and a director of resources. As a coordinator, the PGL must delegate practice management functions and legal work effectively. As a director of resources, the PGL must ensure that all lawyers and paralegals receive appropriate supervision and feedback in a timely manner, monitor workloads and allocate work appropriately based on expertise, experience and individual personal goals. The PGL should also oversee the development and maintenance of a know-how system for the group's practice. There are a few successful PGLs with weak organizational skills, but they typically have a vice chair or deputy leader of the group or a high-level administrative manager who assists in these essential functions.
   
• Ability to build teams – While an understanding of organizational behavior (and a psychology degree) would be useful, it is unrealistic to expect this background or training to be part of the arsenal for most lawyers.
  
  Nonetheless, it is still critical that the PGL be able to develop a strong sense of teamwork within the group, though this can run counter to the individualistic and autonomous culture in some firms. Being effective in building teams will help the PGL create a sense of shared ownership and de-emphasizes dominant individual behaviors. To build teams and a sense of shared leadership, it is helpful if the PGL can assess the skills (legal, business, marketing, management and more) of people in the practice group. A good PGL will seek out opportunities to give responsibility and a credit to his or her team. An effective PGL challenges group members to reach new heights by creating environments for them to develop new skill sets and achieve goals. The PGL must be able to reach across offices to pull teams together.
   
• Flexibility – While it is important that the PGL be a decisive leader (avoiding group think and decision-making paralysis), the PGL should also be receptive to new ideas and ways of doing things.
   
• Strong interpersonal and communication skills – Without effective communication skills, it is difficult, if not impossible, to create an effective team environment in the practice group. If practice group members feel slighted about the exchange of information within the group, it can be de-motivating. The PGL should have strong interpersonal skills, be a good listener and have the ability to relate to group members. The PGL should express appreciation freely and acknowledge the successes of group members. The most effective PGLs are regularly in touch with their group members in a “walk the hall” kind of management approach, even if that means regular travel to visit other offices where the group has members.
  
  The PGL should also regularly communicate practice group successes outside the group through interaction with firm management and other group and office leaders. It is the PGL's responsibility to lead the internal “sales” effort for the practice. The PGL must also have a backbone—and not shy away from confrontation when necessary. By protecting the group and its members where appropriate, the PGL will engender trust and loyalty.
   
• Ability to motivate – The PGL should be able to inspire group members to take on new challenges, push the boundaries of individual comfort zones and achieve new pinnacles of success. He or she needs to create a healthy camaraderie and friendly competition that makes undertaking these challenges exciting. The PGL must be able to coach and help group members create new opportunities for themselves.
   
• Commitment – Assuming the compensation system rewards PGLs for doing their job, the PGL should have the inclination and willingness to spend time managing the practice (at least 400+ hours per year for small groups and sometimes as much as 1000 hours for large groups or those facing very complex issues). He or she must possess a selflessness and willingness to put the group above his or her personal practice.
   
• Business acumen – The PGL must be able to understand the economics of the practice. He or she will work with firm management to establish economic goals for the practice group and supervises the practice P&L. The PGL is also responsible for making recommendations to firm management regarding billing rates, pricing strategies, profit margins and client intake issues.
  
  To be successful, any PGL must create a leadership team within the practice in which he or she shares particular aspects of practice management with other talented people, particularly those with other strengths.