There is one huge mistake that small business owners make. And do you know what that is? They do not run their business like a business. Because often times they do not think of it as a business. They think about their business as a vehicle through which they can do the work that they love. I have heard so many times that people aren’t earning what they’re worth, that they feel bad about charging more because they love the work so much. I know that I lived this way for a very long time and that kept me underearning. I was earning $20,000 to $30,000 a year as an attorney, and for some reason, I had convinced myself that my love of the work should be enough. If I really cared about it, why would I collect money? Why would I be paid for it?
This is a myth that keeps us stuck. You get in this mindset of thinking you shouldn’t think of it as a business, you shouldn’t market, you shouldn’t use sales techniques, shouldn’t get organized with your finances.
However, your law firm is a business and it needs to be run like one. You are a CEO of a business and you have to act like it, but you’re also a lawyer and you can still act like that too. You just have to keep in mind that you need to handle the business side of your business. That’s why I wrote the book Be the CEO of your Law Firm, because I wanted to teach people how to run their law firms like a business. It is extremely important that we think of it as the business that it is because we can’t always be looking at it from the perspective of your client and start making excuses for them. You might think things like “Oh it’s Christmas, that’s why they can’t pay.” But you know what? You have to pay your staff for Christmas and they have families too. You have to pay yourself for whatever holiday it is that you celebrate. You have a family too. There are all sorts of considerations that have to be made and truthfully, at the end of the day, we have to put our business hats on. We have to think of our businesses as a business.
So what does that mean? It means you need to get a bookkeeper. You will not do it yourself and it’s not worth somebody’s time in your office. I highly recommend using Bench. You’ll get a discount if you call them and say that I sent you, or if you sign up through this link. I’m telling you this will transform your life! Think of this as a business, that means you need to outsource some things because you can’t do everything. You cannot do everything and you’re not going to be good at everything, because what you’re really good at is being a lawyer. You may not be as great at being a businesswoman, I know I wasn’t! Sometimes I still struggle with that, which is why we have to hire people to help us run our businesses like the businesses that they are.
You need to send bills, you need to bill your clients. If you are a lawyer that bills by the hour, I implore you to send bills monthly. As a client of lawyers that work hourly, some lawyers just wait to send me bills three to four months later when I have this huge bill with them. I would have much preferred to get bills as I went, $500 here, $700 there, instead of one bill of $4,500 because the lawyer had not been billing me every single month like she should have. So bill your clients regularly, you’ll be doing them a favor.
We tend to push away the business side of things. We push away the money and we don’t want to think about it cause we say it’s in the best interest of our clients. All we’re doing is thinking about our clients because we’re thinking about the work. But you know what’s the best thing that you can do for your client? Have a well-run business. You know how frustrating it is when someone’s gotten a bill wrong for you and you’ve had to call and deal with it. Well, that’s how your clients feel when they are dealing with you getting your billing wrong, or not billing, or not tracking their payments, or billing them for months of work at once and they feel overwhelmed about how they’re going to be able to pay it. You owe it to your clients to have a well-run business.
You also need to have a business manager who’s in charge of all of your finances, making sure payroll is getting done, tracking everyone’s hours, making sure you have the policy manual in place, making sure it’s updated, making sure people are following the training manual, etc. Don’t get me wrong, it’s hard. At first, I felt like an evil dictator when I was telling people that they had to come to work at an actual time. I didn’t even want to tell people that they had to come to work at a certain time because it made me feel like I was being too mean! I felt like it was ridiculous that people would have a limited amount of vacation time. I thought everyone should just be able to vacation whenever they want, as much time as they want because that’s the way it should be. That’s the most ridiculous non-business thought that I’ve ever had in my life. But that’s how I was thinking because I wasn’t thinking like a businesswoman. I didn’t want to hurt anyone’s feelings or offend anyone, all I wanted was the liberty to do the work that I loved. But the work that I love to do was suffering because I wasn’t organized with my business.
You’ve got to step it up and commit to running your business like the business that it is, so make that commitment to yourself and to your clients today. If you can’t do it, or if you’re feeling like it’s too hard for you, one thing you can do is grab my book, Be the CEO of Your Law Firm, because I can help guide you through it! That’s one thing. If you can’t do it for you, do it for your clients. They deserve to work with a lawyer who has a well-run business. So get out there and start things off as the CEO.