Whether you are applying for a specific job opportunity, or have just made up your mind that you are looking for a change, the purpose of this article is to help you craft a business plan and value proposition that will make you an attractive opportunity to the law firm(s) you want to practice at.
There are a number of reasons for investing time into producing a thoughtful business plan, not least because prospective hiring managers and sponsoring Partners will expect you to have one, even if you are yet to put pen to paper. It will help you quantify your worth and craft the best possible value proposition, which in turn will not only aid you in interviews and remuneration negotiations but could also open more doors to you.
Calculating your following can be a highly subjective exercise and indeed numbers may vary or need tweaking depending on the prospective law firm. There are numerous things to consider including the strength and depth of your client relationships, your current and future hourly charge rates, cash recovery rates, the reputation of the firm and their ability to service referred work from your clients, potential client conflicts, current and future client activity as well as the economic forecast for the next 6 to 18 months. As you can imagine, by the time you have considered all these factors, not to mention the need to balance optimism/pessimism with realism, this exercise can produce some pretty varied numbers.
When calculating your potential following, it is important to not only to include the work done by you and your team on matters in your name, but also any other work that has been referred by your clients into other departments, as well as work that you may have had to outsource, but could have done by your firm if the expertise had been available. Even work required by your clients that your law firm didn’t win (reputation, available expertise), that could potentially be captured by a future employer.
The next step will involve compiling this information into a marketable business plan. This will be required by most law firms as a matter of course and while the core information can remain unchanged, you will likely need to tailor the plan to suit each law firm, to account for the client base, service offering and reputation of the firm/team as well as potential for client conflicts. The sponsoring Partner or hiring manager will often wish to do this with you or at least provide pointers.
You will want to start with a summary of your practice – roughly a paragraph explaining your technical abilities, client base and sector specialisation will suffice. The firm’s decision will likely be put to a vote by a cross-section of the firm’s Partner base so don’t take for granted that all individuals will know the ins and outs of your practice area and how this relates to them and their team – ensure you highlight any areas of your practice that provide cross-selling opportunities and/or you think you can enhance or complement their service offering.
You will also want to offer an analysis of your market – current and emerging trends, any issues that may be affecting the market or your practice area, as well as a brief analysis of key players and participants.
This business plan will likely be a key factor in your remuneration negotiations so you will want to start thinking about what you are offering and exactly what you expect in return. Typically, most firms utilise the ‘3 x rule’ as a starting point when negotiating compensation packages. This is something to take into account when valuing your following and a key reason to ensure you are capturing all potential revenue when calculating the total value of your client base. It is worth noting that there are circumstances in which this ‘3 x rule’ will be more leniently applied, particularly in instances where your potential hire is to service a lot of panel-based work, or your practice and contact book provides hooks into a market that the firm currently does not capture.
Most firms will expect to see numbers for your current and previous years billing, as well as projected revenue for the coming year. Being the optimist is recommended in these circumstances. Businesses want to hire Partners who ‘back themselves’ so to speak. If you can’t ‘sell yourself’ in these circumstances, what confidence will they have that you can do so to prospective clients? Furthermore, most law firms will automatically apply a conservative discount to any numbers you give them so there is no need for you to do it to yourself. Realistic optimism is always recommended, whilst also highlighting all the areas that you expect to be able to make future gains and grow the firm’s market share.
In summary, a relatively small amount of time spent thinking about how to best represent yourself and your practice, even if, in the first instance you don’t wish to share this with any other parties, will help crystallise your core value proposition, and focus your mind on what exactly you bring to the table, making your ‘pitch’ much more succinct and thoughtful when interviewing. It will also be useful as a thought exercise to get you thinking about what kind of law firms would be the best possible move for you. Finally, it will provide you with a core document that you can then tailor toward each individual job opportunity as you see fit.
