Are you a Thermostat, or a Thermometer?
Ever heard the challenge to “be a thermostat, not a thermometer”? I love that one from Dr. King, and the empowerment and agency that come with it. It challenges us to set – and maintain – the temperature, not just report on or be in it.
Unfortunately, we hear a lot of lawyers who feel like they have to be thermometers in the practice of law. They are stuck in the default law firm model of hourly billing, or they try flat fees but feel trapped by the structure and afraid they’ve put themselves in a lose-lose situation, or they feel mildly annoyed by their practice (or worse) for a myriad of small reasons – and don’t realize that they actually can just step out of those well worn ruts.
As law firm owners, we have an incredible (and often unacknowledged / unrealized) opportunity to be the thermostat. We can set the tone for how we engage with clients, and as a result, we can create a MUCH better situation for our clients and ourselves.
Sure, but HOW?
It starts with getting clear on what you actually want from your work. At ADVOS, we talk about it in terms of “picturing your PROmance” – being specific about what it would look like to be in a practice you love that loves you back. That means asking yourself questions like: What kind of work are you best at & do you enjoy most? What type of work do you hate doing? Same kinds of questions for the types of clients you do / don’t want, they way you do/don’t want to work (remote? with a team? a particular schedule of days or hours? how will you interact with clients?), what you want the financial picture to look like, and every other aspect of the work. Often, the negative question – what are the things you absolutely do NOT want in your life – is the most powerful clarifying question.
From there, you can design the business model that is aligned to deliver on your PROmance. That might seem daunting, but I can tell you from our own experience and from the results of other firms we’ve worked with – it CAN be done! If you’re just starting out, then you have a fantastic opportunity to start from a well-aligned model instead of having to adjust an already productive firm. But if you’re already practicing and feeling the pain of a business model that isn’t designed to deliver your PROmance, you can start to adjust by degrees and still see pretty immediate relief and RESULTS.
The most impactful shift: Ditch Hourly Billing
For many of the lawyers we talk to, the single move that has the most immediate and broadest impact is to shift from hourly billing to deliverables-based billing. (Note – there is an important distinction between “flat fee” and “deliverables-based” pricing – read more here.) That shift positions you as the thermostat – you are setting the terms of the engagement, in a way that works for you and keeps you aligned with the client.
Imagine this:
You’re clear about the value of the work you’re doing, for both you and the client, and have a mechanism to adjust the fee based on changes in the project scope, without significant effort or angst.
You know what work you’re agreeing to do, you’re happy to do it for the price you’ve agreed to and the client is happy to pay it, and in many cases you’re getting paid up front and in tranches along the way.
When the scope inevitably adjusts, whether due to the client’s choices, the other party’s approach, previously unknown factors, or whatever else, you’re not stuck and you aren’t getting sideways with the client. Instead, you’re equipped with the framework and scripts for having a conversation with the client about what the changes mean for the project and fee, what choices the client can make, and how you’ll move forward.
You never do work your client isn’t happy to pay you for. Dreamy, isn’t it?
Doesn’t have to be a dream.
Over the course of a decade of practice at ADVOS legal, we’ve been committed to deliverables-based billing, and have honed the method. (Which is to say, we found ALL the ways NOT to do it, and sanded a lot of rough edges until we found what worked beautifully.) If you’re tired of billing by the hour, and want to fast-track your path to a better way, check out our P3 Method, or feel free to reach out for a quick chat.
There really is a better way, if you want to set the temperature for a practice you love!
To your #PROmance,
Whit