Developing a strong strategic plan for your law firm

Many lawyers spend a lifetime building their legal practices into thriving businesses with an abundance of clients. While your day-to-day grind is vital to sustaining operations, it’s also essential to have a strong strategic plan in place to secure your law firm’s future. Your firm’s strategic plan is the blueprint not only for when challenges and crises arise, but it’s also the roadmap attorneys are referencing for guidance on how to succeed and grow in the firm. How should attorneys approach the strategic planning process for the best results?

In this episode of Spill the Ink, Michelle Calcote King interviews Wendy Merrill, the Director of Strategic Consulting at Affinity Consulting Group. Wendy shares her experience working with law firms to develop strategic plans in the post-pandemic world, insight into what areas firms should prioritize during their strategic planning process, and what she sees attorneys commonly do wrong. They also discuss how technology can help — or hurt — a firm’s ability to adapt to challenges.

Here’s a glimpse of what you’ll learn

• Why should law firms care about strategic planning, regardless of their size?
• What factors and market forces are shaping priorities during strategic planning?
• How can law firms address employee retention during the strategic planning process?
• What common mistakes should firms avoid throughout the strategic planning process?
• How is technology impacting firms and what role does it play in strategic planning discussions?
• How does having a strategic business plan help firms when crisis strikes?

About our featured guest

Over the last 10 years, Wendy Merrill has helped thousands of attorneys and their firms to dramatically improve their origination and realization rates, practice management, business development and leadership skills. As Affinity Consulting’s Director of Strategic Consulting, Wendy helps law firms with strategic planning, executive retreat facilitation, growth strategy, marketing planning, partner development, succession planning, and best practices for improving profitability. 

Prior to joining the Affinity team, Wendy served as part of a turnaround executive team at DRI (the largest civil defense bar association) facilitating the refresh of the 62-year-old organization. As part of her commitment to facilitating necessary change in the legal space, Wendy authored her first book, Path to Impact: The Rising Leaders’ Guide to Growing Smart, in 2019. Her favorite part of her role is helping professionals recognize and quantify their value, and to think and do bigger. Wendy lives in Monkton, Maryland, with her husband, three children, two dogs, and her retired racehorse.

Resources mentioned in this episode

• Check out Affinity Consulting Group
• Follow Affinity Consulting Group on Twitter, Facebook and LinkedIn
• Connect with Wendy Merrill on LinkedIn
• Read Path to Impact: The Rising Leaders’ Guide to Growing Smart
• Say hello to Michelle Calcote King on Twitter and LinkedIn

Sponsor for this episode

This episode is brought to you by Reputation Ink.

Founded by Michelle Calcote King, Reputation Ink is a public relations and content marketing agency that serves professional services firms of all shapes and sizes across the United States, including corporate law firms and architecture, engineering and construction (AEC) firms. 

Reputation Ink understands how sophisticated corporate buyers find and select professional services firms. For more than a decade, they have helped firms grow through thought leadership-fueled strategies, including public relations, content marketing, video marketing, social media, podcasting, marketing strategy services and more.

To learn more visit www.rep-ink.com or email them at info@rep-ink.com today.

Transcript

Wendy Merrill [00:00] Even if you’re really busy and you’ve got a lot of pressure on you to bill, carve time out and look at your business development. And you have to understand that while you may bill $400 an hour to a client, your business development is actually worth exponentially more. It’s not a waste of time just because you can’t bill it to a client. You’ve got to carve it out and you have to commit to it.

[MUSIC AND INTRODUCTION] [00:22]

Michelle Calcote King [00:43] Hi everyone! I’m Michelle Calcote King, your host, and the Principal and President of Reputation Ink. We’re a public relations and content marketing agency for law firms and professional services firms. To learn more about us go to www.rep-ink.com. 

As a business owner, you’re constantly eyeing growth opportunities and thinking through what you can do best to position your business for success. Well — like it or not — a law firm is a business and if you don’t have a clear vision for the future with measurable markers of success, you’re essentially just treading water. The strategic planning process is a crucial component to securing your practice. But, how should you go about it?

To talk about this topic, I’ve invited Wendy Merrill to be on today’s episode. Wendy is the Director of Strategic Consulting for Affinity Consulting Group where she helps law firms with strategic planning for growth and improving profitability. She’s a published author, and a seasoned business developer and marketer.

I’m really excited to have you on the show! Welcome!

Wendy Merrill [1:45] Hey! Great to see you.

Michelle Calcote King [1:47] Wendy and I know each other well. I gave that very brief intro but if you wouldn’t mind giving us a little bit more about your background. Tell us about your book and your services at Affinity.

Wendy Merrill [2:01] Sure. So many questions; so many things to talk about. I have been, I’d say, immersed in the legal space for over 12 years as a business development strategist, growth strategist; and also helping firms with their retention needs, their professional development needs, and all sorts of really fun and exciting things. Helping law firms think more like businesses, which I love to do.

A couple of years ago, I wrote a book that was specifically written for rising leaders. So, those that are a little bit newer, a little bit younger, in the professional services space — especially law firms — who have aspirations to be impactful, really want to make a difference, want to take on leadership positions, and want to grow their firms but aren't really sure how to start. So that's what it was designed for. So that's called Path to Impact: The Rising Leaders’ Guide to Growing Smart. 

Michelle Calcote King [3:07] Awesome. Let’s talk about strategic planning. Why should firms care about it, regardless of whether they’re small or large? Tell me about that.

Wendy Merrill [3:17] I want to put it in the post-COVID perspective. I think that’s probably most relevant now because COVID, you know, it continues. We’d like to think we’re in post-COVID, but it’s been terrible. But, there have been a few silver linings, dare I say. I think one of the silver linings for the legal industry in particular is it forced law firms to start thinking about their business model and thinking strategically about where they want to go.

When the pandemic happened, pretty much overnight, suddenly firms were faced with the fact that maybe their technology support was not where it needed to be; they didn’t have enough laptops to allow for remote work, for example; they were faced with having to figure out a whole new culture. How are they going to service clients? How are they going to retain good people? All sorts of things.

What I have found is the last couple of years, law firms are really starting to think about, “Well, why don’t we really be more strategic about how we grow? Why don’t we think a little bit more analytically about what does growth mean for us? What kind of clients do we want? What kind of practice areas do we want to specialize in? How do we want to grow our team? What kind of people are our future leaders? And set up goals, objectives, KPIs?” Things that are kind of new to the legal space; things that businesses have been doing for years and now law firms are doing.

Michelle Calcote King [4:48] Yeah. There are a lot of market forces. Obviously, you mentioned COVID, but there are other market forces that are really pushing law firms to change old ways. There are ALSPs, client demands and that kind of things. Are you seeing that that’s top of mind for many firms?

Wendy Merrill [5:09] You know what’s top of mind? People. Holding on to people.

Michelle Calcote King [5:16] Oh, interesting.

Wendy Merrill [5:17] There are certainly pressures like you said, the non-lawyer-owned legal services provider. Certainly mergers of larger firms and pricing pressures. All sorts of things.

Michelle Calcote King [5:32] It’s an interesting point you make about people because we read about it and there’s all the news about the “Great Recession.” tell me what you’re hearing from firms about that.

Wendy Merrill [5:42] As I mentioned, people has become the biggest focus for law firms in that certainly the great resignation affects them; this quiet quitting — which is a really strange concept. They can't really take it for granted anymore that they’re going to have people to do all the work. For example, most of the law firms I’ve spoke to in the last couple of years had an influx of business. They were very profitable and did very well, but their biggest problem is they have more work than they can handle because they are struggling with retaining associates for a number of reasons. They’re also struggling to hire lateral hires. The goal of every firm is to bring over attorneys with experience that have a nice book of business they can meld into their firm. 

It’s been a big struggle for firms and it’s been, I think, sometimes a distraction from, “Okay, how do we go out and get more clients? Well, we’re not really thinking about that. We’re really more worried about how are we going to service the clients we have?” So it’s not just employee retention. It’s also client retention.

Michelle Calcote King [6:55] In the strategic planning process, how can firms address the people factor? How do they go about that in doing their strategic planning?

Wendy Merrill [7:07] A couple of keywords come to mind: trust, transparency and transition. 

Trust is the most important thing. If a firm is really serious about thinking about how they want to grow, and thinking very strategically about putting one foot in front of the other, they have to make sure that everyone trusts each other. There has to be very deep trust among the partners, which sometimes can be a struggle. There also has to be trust among the associates, the non-partner lawyers who are looking to the partners to be leaders in the firm. They have to make sure they have their best interests in mind. Also staff. I mean, they make the magic happen. There are a lot of administrative folks that sometimes struggle with trusting the direction that the organization is going in; that the lawyers really are going to appreciate the work that they do, and vice versa. So trust is really important.

Transparency, as I mentioned, is something that has not always been a theme in law firms. I would say that the legal business has probably not been known as one of the most transparent industries. But that is changing. The reason for that is because the younger generation, the next gen wants to know what’s going on. Not only do they want to know what’s going on, but if law firms really want their people to be engaged and buy in to what they do, understand profitability and contribute to the firm, they need to understand how the sausage is made. They need to understand, how do we make money? How do we do things? Many lawyers really just don’t know. They’re very focused on what they need to do on a day-to-day basis, which doesn’t exactly support the cause, if you will, and really helping the whole firm work together in lockstep towards a common goal.

The third keyword is transition. Talking really about succession planning. That is a big, big, big, big challenge I think in a lot of businesses, but I just happen to see it a lot in the legal space. Many firms intellectually understand that they need to think about it, but it’s very emotional, Michelle. Very, very emotional because for so many people who have built these firms, it’s their baby. They’ve been doing this forever. It’s their identity and the thought of having to step away from that is scary to a lot of folks, quite frankly. You know, “Well what am I going to do next? What does my next chapter look like?” And it’s also scary because when you retire there’s a finite amount of money that will come in. So, it’s not like, “Oh, well, I’ll just keep earning in perpetuity.” So, those are two roadblocks I think sometimes to the succession process. But, succession planning is so important not only for the future growth of the firm, but also for the security for the rest of the firm. Meaning the other lawyers and staff who want to know what it’s going to be. They want to know what’s going t happen and they want to know what their future looks like. They need to understand what kind of upcoming transition there might be, what it looks like, what leadership change, etcetera.

Michelle Calcote King [10:28]  I've always found that fascinating about the legal industry how so many lawyers really work for a much longer time than I see in other professions.

Wendy Merrill [10:40] I mean there’s the old saying that someone’s going to die at their desk. It sounds kind of funny and kind of morbid at the same time, but it’s true. It’s the kind of profession  that you can and you can. You can hold on to a few clients and do work at the end of the day, which is fine. But that person really shouldn’t be leading the firm. They should perhaps move into an off-council position or something like that where they can still contribute but they relinquish a lot of their decision-making and control to the next generation.

Michelle Calcote King [11:11] What are some of the ways you see law firms getting strategic planning wrong? What are some common mistakes that firms are making?

Wendy Merrill [11:23] I think the biggest mistake — and it’s not just law firms, it’s a lot of businesses that engage in the process — is they focus more on the plan, not the process. They will invest a lot of time and energy and money and emotion into going through the strategic planning process. They get a document that’s like yay thick, it goes on the shelf and then that’s it. It happens a lot. So we focus a lot more on the process itself. So, it’s not just about the plan, but how is it a living document? What are strategic objectives? Who is bought in? How do we all work together? And how do we assign tasks and action steps and dates and make sure that the implementation is happening? And that we’re maintaining momentum?

It’s very difficult because you’re working with firms where time is of the essence. Let’s just say, time management is probably a struggle for all of us, but also especially for lawyers. Especially for lawyers, when they’re so busy — especially litigators — if they’re so busy and they’re pulled in a million different directions, it’s really hard to commit the time and energy to, “Okay, let’s take the next steps. Let’s move this along.” so, a lot of our clients when they express interest in strategic planning, we want to find out, “Well, how committed are you? Are you serious about the process? Here’s what’s going to be involved.” Then afterward, we try to stay involved to make sure that we’re pushing the ball along in any way that we can to make sure that we are focusing on measurable results.

Michelle Calcote King [13:00] Yeah, I could see how that would be a huge part of it because it’s easy to get lost in the day-to-day of just delivering client services and keeping that deadline.

We know law firms and the law, in general, is more conservative and slower to adapt to change. How are you seeing how technology is impacting firms? Does it play a role in this strategy discussion?

Wendy Merrill [13:35] It definitely does. At Affinity, we do a lot of technology consulting as well and focus on improving processes and systems. Many firms will come to us and say that their people are frustrated for whatever reason. They don’t like the systems they have or they don’t know how to use them. Sometimes it’s the system, but other times it’s the people. What I mean by that is they’re just not properly training, they’re not properly engaged and they don’t understand the capabilities of the particular technology they have, or for whatever reason, they’re just not interested in it. So, it absolutely affects this whole process. I mean, there are people who will be so frustrated and have such low job satisfaction because maybe their impression is that the systems aren’t there, the technology is not there, so they move to another firm where they feel like their needs are better served. But, oftentimes it’s just a matter of understanding what you have. These days you can automate so many processes, but many firms are still relying on kind of like a hodgepodge approach to technology. They’ll have a piece of software over here and a system over there and they’re not talking to each other. So, it requires a lot more steps that aren’t necessarily ones that they need to take. 

Technology can be friend or foe, right? I mean these days it’s absolutely essential that you have a really streamlined system, and you know what you’re doing, and you’re able to use it, and everybody’s engaged. But at the same time, it can be really frustrating.

I personally use technology all the time and I don’t consider myself a tech person. I get frustrated and I tend towards old-fashioned ways. Sometimes I’ll use it but maybe I don’t use it the best way I should. Fortunately, I get a lot of great training from my company to learn how to improve myself, but that’s not always the case in firms. I think it’s really important. Technology is just a huge component to this whole process because it’s one of the engines to progress.

Michelle Calcote King [15:36] Well and it needs to be implemented strategically. I remember someone in the industry telling me — and it wasn’t a law firm they were talking about; they were talking about another small consulting firm — and they said it was always the shiniest new platform and there was almost fatigue of the employees hearing what’s the newest thing they had to learn and figure out. That was fascinating to me because I’ve always seen the opposite where leadership is sluggish to adopt something. But it can be either way.

Wendy Merrill [16:10 It can. Also it comes down to the same thing for both it’s if people are not engaged in owning their role and understanding why are we using this system or why did we hire this person, if they don’t understand that, it’s hard for them to understand their role and how important their role is in the overall success of the firm.

Michelle Calcote King [16:36] Yeah. How do you see strategic planning and having that plan — and hopefully it isn’t just sitting on the shelf — but having that strategic plan when a crisis hits? We’ve all been through COVID now but I know there are other crises. How have you seen firms weather a crisis or not weather it very well because of having or lack of having a strategic plan?

Wendy Merrill [17:06] I’m going to answer that question in sort of a sideways fashion, I suppose. Because of COVID, once upon a time, I think many businesses would say, “Well, what’s the one-year plan? The three-year plan? The five-year plan? The 10 and 20 year plan?” These days I say one to three. We don’t look beyond that because we all know things change. It’s good to say, “Well long term I’d like to do this.” But we also know that we have to be nimble. We have to be prepared for anything to happen and have a backup plan. I think what I’ve seen with firms is, certainly, they’ve invested a lot more in technology, they’ve invested in cloud technology, getting servers out of their offices, which is risky. Also thinking about a creative approach to the workspace because if something happens, like a pandemic or any crisis, if they have a huge lease on a huge office space and something happens, they’re stuck. So many firms are starting to think about what’s a flexible option. Doing hotelling or figuring out if they even need to be in an office. I think that it’s affected the way people are planning for the future. We’re all aware, but i think it’s human nature to sort of say, “Well, let’s just kind of stay in our comfort zone.” And I don’t know how much crisis planning law firms can really do other than what they’re doing right now.

I do think it’s also really important to focus on culture. If you don’t have a really strong culture and something happens, your firm will have a very difficult time weathering the crisis. Culture is a newer phenomenon, I think, in terms of thinking of it as this sort of entity. Like, we have to be intentional about it. What is our culture? What is our brand? What do we stand for? Why do we do what we do? How do we care for our people? How do we engage them? That is absolutely vital to the success of any firm and I would say weathering any crisis that may come their way.

Michelle Calcote King [19:22] Agreed. It’s interesting because the Legal Marketing Association’s Southeastern Conference, their whole theme is culture this year. I’m looking forward to that. I think especially for on the marketing side, often marketers kind of get thrown these things, you know, if the firm is big enough to have a marketer in-house. They get thrown anything to do this kind of stuff. I think it’s going to be a fascinating discussion.

Wendy Merrill [19:51] I’m really happy to hear that they’re doing that because I personally believe that marketing should have the responsibility of being stewards of the culture. And I don’t think a lot of firms properly utilize and really take advantage of the knowledge that their marketing professionals have in creating this culture because it’s really branding. I mean, it’s really the same kind of thing. I’ve also always wondered why HR departments and marketing departments don’t sit next to each other and work together because it’s kind of the same thing.

Michelle Calcote King [20:27] It’s becoming one in of the same, absolutely. Well, as recruiting gets more difficult and retention, right? This is how people, you know, through marketing is how they learn what kind of firm this is. Absolutely.

So, you have answered this already, but I want to ask it. How do you know if a strategic plan is sort of strong, but also nimble enough to evolve? You mentioned, “Look let’s look one to three years.” Are there other ways to know that, “Look we have a strategic plan, but we’re still going to evolve and react to market changes”?

Wendy Merrill [21:08] I think you have to build that in. When you’re talking about the planning process, you have your goals and you have your strategic objectives. Strategic objectives should be broad enough that you can apply it to different things that may come your way. It may be something like, “We want to become the go-to firm in this particular practice area.” Okay. Well, there are a lot of ways you can do that. Maybe you try spending a lot of money on digital marketing. And maybe it doesn’t go so well. Okay, well, let’s go to Plan B. What else can we do? I encourage firms to think about — there are a lot of ways to skin a cat, right? — so, I think that if you have a really strong foundation where you have buy-in from all of the stakeholders, and they all agree, they’re all aligned in what they want and their values, that’s the most important thing because if they’re faced with a crisis or they’re faced with something going sideways or it’s not going as well, everybody should be able to come back up together and say, “Okay, let’s regroup. Remember what we talked about before; remember what's really important to us. This particular tactic isn't working. Let's shift to something else.”

So, like anything else, it really comes down to the trust that people have with each other within these firms and making sure that they’re constantly aligned. And by the way, Michelle, that’s not a one-time thing. It’s something that you have to keep reconnecting and reiterating. You have the strategic planning process and you go through this; many firms will have a once-a-year retreat. That’s great, but what’s keeping people connected throughout the year? That’s absolutely imperative.

Michelle Calcote King [23:06] How do you help firms do that? How do you help them kind of stay connected to their strategy?

Wendy Merrill [23:14] It depends on the firm. I like to definitely set up some kind of a structure. For example, I recently worked with a law firm that was having — I can’t remember how often they were meeting as partners; maybe quarterly; maybe twice a year. They had so many changes going on, I said, “You all really should be meeting monthly.” So, we had a retreat and it was hugely successful. Everyone was thrilled to come together and share. I said, “Okay we have to keep this momentum going.” So, one of the things that we’re doing is we’re having monthly partner meetings. Everybody’s going to come together. One month you’re together in perso and the other month you’re virtual. To make it easier, here’s the agenda you’re going to follow every single month. It’s going to be a revolving facilitator, so somebody gets assigned each particular month and make sure they’re on task, and then there’s going to be follow-up. And it's worked really, really, really well. It's made a huge difference for this particular firm. 

Where we try to help is — I mean, certainly you can lead a horse to water, right? But, we try to share ideas about, “Okay, well, here’s some structure you can put to this; and if you lay it out and it makes sense to people.” Also it’s helpful when you’re in the room with them and you whip out the calendar and you say, “Okay, so let’s get it done.” It really makes a difference.

Michelle Calcote King [24:32] That’s great. What else haven’t I asked you that you think law firms need to be thinking about from a strategic planning process? Is there anything that we haven’t touched on?

Wendy Merrill [24:45] We can talk about growth strategy and business development. Many, many firms that I mentioned earlier are very fortunate and have a ton of work right now. So, when we’re all really busy and things are good and we’ve got a lot of clients, we go, “Oh, we don’t have to market. We don’t have to go out and shake hands and kiss babies.” But I cannot underline this enough. When you’re really busy is exactly when you need to be investing because the other shoe always drops. This recession that keeps kind of coming up, you don’t know what’s going to happen. And, it’s going to sound silly, but when you’re busy and you’re successful, you exude confidence and positivity and people want to work with you.

Michelle Calcote King [25:34] Absolutely.

Wendy Merrill [25:35] When you’re not busy, you will absolutely look and seem desperate. It’s happened to all of us. As silly as that sounds, it’s true. So, I’d say, even if you’re really busy and you’ve got a lot of pressure on you to bill, carve time out and look at your business development. And you have to understand that while you may bill $400 an hour to a client, your business development is actually worth exponentially more. It’s not a waste of time just because you can’t bill it to a client. You’ve got to carve it out and you have to commit to it.

Michelle Calcote King [26:09] Yeah. I could not agree with that more. It’s something that I say often about business development, marketing or long-term initiatives. You can’t just throw a campaign out there and generate business, especially in professional services.

Wendy Merrill [26:28] It’s building habits. It’s not just, “Well, let’s do this initiative. Let’s do a PR campaign.” It has to be woven into the very fabric of the firm. It’s building the muscle. It’s saying, “Here’s what we’re going to do.” You just have to build this habit and know that if you’re responsible for origination, business development is just part of what you do on a daily basis, on a weekly basis. It’s just what’s expected of you as an attorney. 

I will add one more thing. Defining expectations, which is a really big deal, I think many firms do not have path to partnership. It’s very subjective. Maybe it’s not written down or if it is, it’s still very sort of vague. This is a struggle I’ve seen where younger attorneys want to have a roadmap. They want to know what’s expected of them so that they can measure themselves and that they can aspire to goals. But, it’s also important for the firm to define what is an “ABC” lawyer. What do we expect of our attorneys? What is the approach to billing? What is the approach to client service? What is the approach to culture? Leadership? If it’s not defined, then how can anyone be judged by it? How can anybody be measured? This is something that I also reiterate a lot with the firms they work with. 

Michelle Calcote King [27:59] That’s really important.

Thank you so much. This was a fantastic overview of the strategic planning process for law firms and I can imagine it’s top of mind with many firms.

We’ve been talking to Wendy Merrill of Affinity Consulting. Tell our listeners how to get in touch with you, Wendy.

Wendy Merrill [28:18] Sure. My email is wmerrill@affinityconsulting.com. Definitely connect with me on LinkedIn. I’m very, very active on LinkedIn and would love to connect with all of you. Feel free to reach out with a question and an idea. I love to collaborate and I love to learn, so I would be happy to speak to any of your listeners.

Michelle Calcote King [28:44] Awesome, thank you so much.

Wendy Merrill [28:46] Thank you.