When you retire, do you know who will assume responsibility for your small law firm? The 2011 Law Firms in Transition Survey from Altman Weil found that nearly 50 percent of law firm leaders were concerned about succession in their firms. The following year’s survey found that client transition and associated loss of revenue was a source of particular concern.
The loss of a single attorney, especially in small law firms, can shake the foundation that the firm was built upon. Planning for succession will ensure your firm remains strong throughout a retirement or other personnel changes.
Consider focusing on these areas when developing a succession plan for you firm:
Define your long-term plan
Involve your leading attorneys in an ongoing conversation about succession issues. Remind your team about the importance of keeping clear records, and consider using software tools, which we’ll discuss more below, to streamline processes and communications. Make sure that at least two attorneys are familiar with each client matter in case of unexpected events.
To avoid generational tensions among your team, you may choose to frame succession plans as mentorship opportunities. When your firm plans ahead for succession, your most experienced attorneys can ease less experienced team members into responsibilities.
Organize your options
As you approach attorney succession at your firm, consider all your options. Observe which members of your team work best together, and who is best suited to particular tasks. Transitions proceed most smoothly when they respect the talents and interests of individuals. By planning ahead now, you can lay out a few succession options and adjust your plans over time based on what’s working.
Make everything easier and more accountable with software
In times of transition, it’s easy to lose track of paper and digital files. This is especially true when each team member organizes their work idiosyncratically. By adopting a document management system like Smokeball, your firm can standardize client files for every matter. This way, whether an attorney’s departure is sudden or expected, their successor can easily access all critical client documents and communications.
Adopt best practices for accounting
As with client paperwork, accounting must be clear and well-organized throughout attorney succession. Review your billing practices during succession planning to make sure that your firm will remain financially stable throughout any transition. Take this time to review your firm’s time-tracking procedures and make updates if necessary.
Creating a succession plan may not be fun to think about, but it could save you a lot of hassle later on. By defining your long-term plan, organizing, using the right software and adopting accounting best practices you will be protecting your firm from possible revenue loss or loss of clients.
Does your firm have plans for attorney succession? If not, it’s time to prepare.
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