A well-crafted business plan is a valuable tool for any law firm partner as it provides a structured approach to achieving long-term success, effective resource management, and knowledge not only of your practice but of how it will fit on your current platform or a new one.
If you are a first-generation lawyer who is also a person of color, then writing a business plan is even more imperative — especially if you are not located in a major market and do not have guaranteed client relationships totaling $5 million or more.
The why
As first-generation partners, it is easy to become focused on the practice of law and forget that part of the power dynamic within the law firm structure is to be equally focused on the business of law. These are two distinctly different animals, but a bifocal approach is essential.
The practice of law is when you become a subject-matter expert in the area of focus for your practice (understanding the industries and clients whom you serve). The business of law relates to the economics behind your practice and how you make it profitable. (Understanding the business side of your practice is what will allow you to be a successful partner.) A business plan helps you marry how those two sides work together now and in the future.
The what
Creating a business plan helps to put you in a certain frame of mind and will help you to be clear on how to move forward with building your practice. It is a document of self-advocacy where you should think big with your feet firmly planted on the ground. Many first-generation law firm partners, especially women of color, are more inclined to under promise and over deliver. However, this frame of mind does not work for a business plan.
A cardinal rule in writing your business plan is to fully appreciate how important it is to walk a fine line between encouragement, clarity, and forward momentum. A business plan can help to spell out how you want to grow your practice and identify the resources that you may already have on hand.
Consider this:
- Where do you see yourself in five/ten years? Is retirement in the immediate or distant future? Think about how you would like to expand your practice. Are there areas where you want to become an expert? What are they and how do you gain the needed training to improve your expertise?
- What are your financial goals? How do you see your practice growing? Are there partners in other practice areas you want to work with? Industries you want to target?
- How do you plan to attract and retain clients? Look at your existing network — where are your law school classmates now? Are their parents within your children's activities circle who work in organizations that could become clients? Are there civic or religious organizations you belong to whose members need legal assistance?
- Is there a specific geography you want to live in or focus on? Do you want to move closer to your family or are you longing to live by the beach? Look into the clients who are located where you want to be located and see how your current clientele aligns with your ultimate plans.
As you grow into your career as a law firm partner, your business plan will change to reflect that growth. It is not a static document. Rather it evolves as you go along in your practice and should incorporate new expertise, clients, industries, or interests.
There are myriad inflection points that should be included in the plan. As your understanding of the nuances of your subject matter increases and you develop deeper knowledge about the business of law, your business plan should reflect this new knowledge. Reviewing your goals regularly will be important. It will help you to see progress and also redefine your overall plan if things change.
The how
Your business plan is not only your tool but also that of the firm. Ultimately, if you are creating a business plan because you are seeking to transition to a new firm, the plan will be reviewed by the firm(s) with whom you are interviewing. Your business plan along with the metrics listed in your Lateral Partner Questionnaire (LPQ) will help determine your base compensation offer and what they believe is the future growth of your practice.
Savvy firms and partners also use the business plan as a road map for integration. If the firm has a formal integration program, the business plan will ensure that you meet with key people at the firm who could be integral to the growth of your practice.
If the integration plan is more informal, you may want to use your business plan to help you begin independent outreach. A solid business plan is a blueprint for your career goals and how to reach them — and is a calling card for your future opportunities. It helps you design how you want your future to look.
Many partners of color, especially women, often experience crippling self-doubt — the process of goal setting involved in creating a business plan can be a hedge against falling off course. Studies have shown that people who are specific about their goals and who write them down are far more likely to achieve them than those who do not. Writing a plan will help to clarify your goals and set out how you will go about achieving them.
Having a well-written thoroughly considered business plan is essential for partners who may not have a significant client following. A carefully considered business plan will help make the case for suitable compensation and can help in the integration process at a new firm because it will identify the practice areas that would be helpful to your growth and assist with merging your practice into a new firm by facilitating conversations with partners in those supporting practice groups.
This is especially true for women of color, even those known as subject-matter experts. Knowing your true value to a firm can go a long way in compensation discussions as you demonstrate, based on your plan, how you will help drive revenue.
