True or False: A lawyer with $500,000 in annual originations can get business. If you're a lawyer, you'll love the answer.
"Has business" doesn't necessarily equate to "Can get business." Sometimes, like a movie set facade, there's no "there" there.
Most lawyers might be inclined to grant the benefit of the doubt, i.e., if she has $500k, she can probably develop business. Not necessarily. It depends on how and when she came by her $500k book.
Here are some of the reasons why "has" might not equal "can get."
- Inherited all of it, e.g., due to another lawyer's departure or retirement. In that case, there's no correlation between "has" and "can get."
- Inherited a portion. The maximum "can get" value is the delta between what she inherited and how much she consistently has each year.
- Developed it all herself. On the surface, this might seem like 100% "can get." Not necessarily. If she acquired all $500k before 2008, "can get" may have little to do with it now because of the level of demand pre-2008 that doesn't exist today. This is a pleasant accident of uniquely favorable circumstances.
If she's managed to maintain the $500k level, that's an accomplishment that equates to some combination of "can keep" and "can get," because there's a natural level of attrition each year due to factors beyond anyone's control (cases settling, transactions concluding, clients being acquired or going out of business, etc.) During the boom, I knew market researchers who estimated this factor at 20% per year. I don't know the current factor, but, given market conditions, it wouldn't surprise anyone if it were higher now. That means that she must get at least $100k per year in new business just to break even and remain at $500k.
The point is that none of these circumstances constitutes an objective indicator that she has the capability to get business reliably, i.e., if she had to start over from scratch, under today's conditions. The only such indicator is having
- declared a specific, measurable goal at the beginning of the year, i.e., amount and type of work ($500k, FCPA compliance)
- identified the segment/source of that work (construction industry w/offshore sales less than $1 billion)
- profiled the buyers (VP Sales)
- identified the basis for demand (activity by "connected" foreign sales agents)
- defined a differentiated market position and related strategy ("just enough compliance to dissuade DoJ vs. unaffordable 'gold standard'")
- established and executed a marketing strategy and tactics that yield sufficient opportunities to support a realistic closing ratio
- committed to and consistently honored a weekly time investment for marketing and sales
- demonstrated consistent sales skills, activity and habits to yield the desired results
The Law Firm Golden Era is over. Demand for traditional legal services is declining. Now, lawyers must compete for market share as their clients do every day: thoughtfully, skillfully, and consistently.
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