Mike O’Horo of RainmakerVT posted a great article, “Lead-generation is not the same as business-generation”. See here. The article notes how the whole process of marketing as most law firms do it is essentially worthless if you “don’t ask for the order” and make the sale at the end of the day. Most lawyers have great difficulty with this step, and miss out on a lot of very profitable business as a result.
In most law firms, the number of real rainmakers is less than 10-20% of the total # of partners. Yet all equity partners are expected to bring in business of a minimum $ amount to support the growth and profitability of the firm. As a result, rainmakers must be compensated to a level that keeps them happy, as they are a rarity in the practice of law. You must motivate and retain these rainmaker partners with appropriate compensation packages to ensure the future success and profitability of the firm. The rest of the partners must be satisfied with earning less if they can’t or won’t bring in the business.
You must reward your rainmakers with bonuses or higher units of compensation to keep them motivated and bringing in new business. You’re not just rewarding partners for hours billed, you’re rewarding partners for originating work, which needs to carry a bigger weighting at compensation time. This is where many small and midsize law firms’ compensation systems fall short in my experience. Make no mistake about it, this is rewarding lawyers for increasing sales. It’s really no different than paying bonuses to the best-performing car salesperson on the lot. The sooner law firms get this, the better off they’ll be. Since all partners will share in an increasing pie, individual partners can’t be worried that a rainmaker is making more than them, when everyone benefits from what a rainmaker does.
Law firms must operate in a business-like fashion. For decades, law firms have operated with a partnership business model which has been protected from the ravages of competition that other professions and businesses have had to endure. Changes must now be made quickly to become more business-like in your operations and reward partners for “asking for the order” before your competitors beat you to it and steal your rainmakers away from you.