Today we are sharing a previously recorded episode that is just as timely as it was when it was first recorded. In it I wanted to talk about the need for growth and how it ties into the subject of intake.
You want more clients and more money, which means you need to grow.
However, growth is often destabilizing.
How can you and your law firm successfully work through the ‘growing pains’? Stay tuned to find out!
In this episode we discuss:
- How growth can be destabilizing, yet necessary.
- 5 principles of why we need to grow.
- The necessity of having a CEO and the CEO’s responsibilities.
- How opportunity is the fuel that propels a business forward.
- The money math of growing and investing in your business while experiencing inflation.
- How clearing clutter removes energy, making room for new energy.
- Why growth can trigger a fear of abandonment.
- How growth can help to overcome entrepreneurial burnout.
Allison Williams: [00:00:11] Hi everybody, it's Allison Williams here, your Law Firm Mentor. Law Firm Mentor is a business coaching service for solo and small law firm attorneys. We help you grow your revenues, crush chaos in business and make more money.
Allison Williams: [00:00:24] Hi, everyone, it's Allison Williams here, your Law Firm Mentor, and on this week's podcast, this is another solo episode, and I wanted to talk about the need for growth because one of the topics that I have talked about very recently and in a lot of different forums actually is intake. And intake inherently implies that you want to if you're if you're optimizing your intake, but inherently implies that you want more people to come into your law firm. You want more clients, more money, more revenue, which is great. But that also means that you're going to be growing if you are bringing in more people or if you're increasing the quality of the person that you're bringing in, you're going to be making more money by virtue of raising your prices so that you can weed out people that might not necessarily meet the standard that you want to have for your business. But when we talk about growth, growth is often very destabilizing. It is change and it triggers people to oftentimes revert and go back to the place where they were when they started or even just go back a little bit. Right. So you start to push ahead. You start to expand, you start to grow. And next thing you know, everything in the world starts to happen. Things just start falling apart. Right. We have physical ailments. We are we have a lot of issues with our kids. We have issues with our parents.
Allison Williams: [00:01:42] All of a sudden we start having staff issues, we start having turnover, and we look around and we say, was it worth it? Wouldn't I just be happier if I stayed where I am? And a lot of people answer that question with. Yes, and then they resign themselves to staying small. And they do that under the premise of protectionism, keeping themselves safe from all the things that happened negatively when they started to grow. But if you recognize that there is a need for growth, oftentimes that can be something that fuels you forward, not from a place of I want to grow for myself, but I want to grow because it's a requirement for my life. OK. So we're going to talk today about the need for growth. And for those of you that might be listening to this podcast that say, I don't really want to grow my law firm. That's fine also. But I want to invite you just to the conversation about the need for growth, because if you recognize that there's a need for growth, this isn't about necessarily getting you to want to scale your law firm. But there are certain things that you have to do in order to continually keep a healthy business. And it involves growth not only in your revenue, but also in the structure and in the opportunities that you create in your business. All right. So there's essentially five principles that I want to talk about today that go to the heart of why we need to grow.
Allison Williams: [00:03:03] OK, so reason number one is all about talent. OK, talent is attracted to opportunity. Your number one job as the CEO of any business, whether it is a law firm or a mom and pop auto mechanics place, a widget factory, it does not matter. Whatever you are selling, if you own the business, the CEO of the business has a job, and that job is to create opportunity. That is the overarching obligation of a CEO. Now, there are essentially three ways that a CEO does that, and he or she will do that through bringing about first the vision, then the resources and then the team. OK, so if you look at most companies, whether they are Fortune Five Hundred, Fortune One Hundred or a category of one with less than six figures in revenue, you're going to see that the CEO ultimately casts the vision, i.e. where are we going, what are we doing with this thing. Right. This thing being the business, Right? Is my business A used Pinto that I am driving at 30 miles an hour down the road, or is my business a pink Maserati? And I use that as an homage to my best friend Amy. Is is my business going east or going west? Is my business just dedicated to family law or does it also include estate planning, criminal defense, immigration law? Is my business going to be a bastion of safety for the community where people look at our business as kind of a shining example, or is it going to be more quiet? Is it going to go into the shadows but serve a very elite clientele of people who really don't want to have my law firm on the splashy public pages because they are very private person.
Allison Williams: [00:04:55] Maybe they're a celebrity or they could be somebody who's in the public domain and doesn't want the legal representation to be known to the public. But however you get there, whatever size of your business, whatever direction of your business, the one who owns it decides those things, OK, or delegates those things to a CEO that might be hired outside if the owner of the business wants to just be a shareholder. But a business needs to have a CEO and the CEO is going to be responsible for the vision, the resources. Of course, that's money. But it's not just money. It's also the resources of people, which we're going to talk about next. But when you talk about resources, it's how are we going to be allocating those resources? It doesn't mean that the CEO is the one signing and writing the checks. Could be that. But it is that the CEO is the one for deciding. Are we going to... Are we going to divert our time and attention to this new project over here? Or are we going to stay focused on the main project that we started last year? With team, who is the next person on the team? Are we going to have an eat what you kill law firm, four partners stuck together, or are we going to have a pyramid where we have kind of the the chief owner at the top, then we have a couple of equity partners. Then we have maybe a few non equity partners, a few associates, a few junior associates and then paralegals and legal assistants in our legal pyramid.
Allison Williams: [00:06:21] What is it going to look like? But in each of those different areas, in the vision, the resources of the team, there must be opportunity. Opportunity is what fuels the business forward. People are drawn to places that benefit them, not places that benefit you. So if you have created a business, yes, it must benefit you in order to be of such value that you're going to continue to invest in it. But it does not have to be and should not be just about you. If your business is just about you and it provides nothing for other people, you're going to have some pretty resentful people working in your business. And people are the lifeblood of your business, right? You're going to have some stale blood running through your business if the people don't sense that they're getting something out of being there other than just a paycheck. OK, so this whole idea of talent being attracted to opportunity is something that is really driven by the general principle of moral life.
Allison Williams: [00:07:20] This is a universal law principle, and it really stems from the idea that people are always seeking what is going to benefit them. So they're always looking to be impressed and by impressed, I don't mean that you have to have, like, something flashy and and sizzly or sexy for them. But they need to be impressed by you such that they look at you and they say that is going to enhance my life. OK, so I want you to think about this principle that comes from one of my favorite books, The Science of Getting Rich. Wallace Wattles and Chapter 14 covers the impression of increase. And I talk about this idea of creating an imprint and impression of increase in everything related to marketing, because marketing is the channel through which we attract people to what we are doing in our business so that they will want to work with us. But the impression of increase essentially is that and this is a quote directly from Chapter 14 of Wattle's book. You must so impress others that they will feel that in associating with you, they will get increase for themselves. Your business will increase rapidly, and you will be surprised that the unexpected benefits which come to you. OK, and this is a piece of advice I give to lawyers that are clients of Law Firm Mentor all the time, like tell everybody you are growing your business.
Allison Williams: [00:08:42] When you check in with former clients, tell them I am growing my business and want to work with more people like you. When you're connecting with colleagues at the bar, when you're connecting with local business owners, tell them I am growing my business and I want more clients. And a lot of lawyers have resistance around that idea. They think if I tell people I'm looking for clients, that makes me sound desperate, like I can't get any. But that's the most ridiculous thing I've ever heard of. If you think about it this way, OK, I want you to really think about it. Every time you have a commercial on TV, that business is saying we want your business right. That business is offering you something for yourself, something that will entice you, excite you, benefit you, that you say I will trade my dollars, my economic value for the value of what that will do for me, whether it is the most recent Clorox detergent or it is the the you know, I'm just going to throw out some some wild things that could be Coca-Cola. Right. The taste that you're going to get in exchange for the economic value that you pay for that. It could be tickets to Disney, the experience that you're going to have by going to Disney in exchange for the cost that you pay for the tickets.
Allison Williams: [00:09:57] Right. Whatever is being advertised is saying whatever business or entity or experience is being advertised. What is happening is that that business is saying we want your business. So as a professional services company, there is nothing inherently wrong and in fact there is something intuitively right by saying to people, I want your business. And they're going to say it in a way that signifies to them that you are growing because when you are growing, you are popular and everybody wants what everybody wants. Nobody wants what nobody wants. OK, rubbernecking when you're driving by an accident and you can't help to drive two miles an hour to see that one car is crunched up on another car. That is about seeing something that other people are saying, OK, because if you're, you know, half a mile down the road and you don't know the accident that's coming up, you're thinking, why is that? Why is the traffic taking so long? I just want to get to where I want to go. And then you see the accident. Now, instinctually, you might look because you're concerned for human life or you're concerned about the fact that the car might blow up or what have you. So you have an intellectual curiosity. But what has you kind of staring is the fact that everyone before you is staring at people, after you are staring, and then everybody just kind of moves like molasses past the accident because everybody wants to be a part of what everybody else is already a part of.
Allison Williams: [00:11:27] That's the reason why people are drawn to bigger businesses. And by the way, that's the reason why you get scalability and traction in a business, because as you start to scale your business, as you start to add more people to your business, what you'll find is that more people will be seeing more people. That's one of the ways, by the way, psychologically, that you can cue up the idea that you have bigger, that you have more available to you. One of the things that I have always done, not just because I fundamentally believe in a law firm, that not only lawyers provide value, our clients are taken care of by all people in the business. I'm a big proponent of having your entire team pictured in your law firm, because if it's you and your partner, John, and you are standing in your vestibule or your front lobby, you too might look great. You might be very attractive people. You might have a very dominant power pose. You two might be the names and faces of the business, but two people is not as impressive as 10 people. So having your support staff standing there next to you, taking up space, filling the corridor, does not just promote them and make them feel important and make them feel valued and a part of your culture. But it also shows the world that there is more of your business.
Allison Williams: [00:12:48] It gives that impression of increase. It gives that sense that there's a whole lot of people there that can add value to my life, not just the one person that I was personally referred to. And by the way, most people intellectually are not going to be thinking that when they come in. Here's a great, huge office with all these people. Most of them are going to fixate on whoever it is that they're going to work with. But from a psychological perspective, they're seeing and sensing all those other people and they're getting that impression of increase. That's why they're there. OK. All right. Number two, so we covered in the first reason for growth. The first necessity of growth is that talent is attracted to opportunity. Number two is simple math. OK, I could lead with this one because this one is probably the one that most people are going to get. But I want you to really think about this, OK? And I'm going to use two hundred thousand dollars as business revenue. It applies no matter the business revenue that you have. If you have a two hundred thousand dollar business and what you pay yourself and what you pay your team takes up one hundred thousand dollars, then you have one hundred thousand dollars left to run the business and be profit for the business. Now, of course, profit is not just something that you take out to economically benefit yourself for the risk of owning a business. Profit is also partially reinvested in the business to have the business grow and to stave off the ups and downs of business over time.
Allison Williams: [00:14:18] But basic math, we start with two hundred. We take out one hundred for ourselves as compensation and for our team. When we do that, we have one hundred left. Simple math. Now, next year we have two hundred thousand dollars. Let's say we did not increase our revenue at all. Our revenue remained flat next year. However, expenses and compensation for your team are not going to likely remain flat. It may to the extent that you can. But this is often what causes businesses to have to scurry around desperately seeking to cut costs wherever they can, because your revenue stayed flat, but your expenses did not. Just as you are in a business, your vendors are in a business, right? They may apply a slight increase year over year or after a few years. Right. You may have come into year four of a certain price point. Year five, which is your second year with the business, they raise their prices. So you're going to be paying more for that same service. Then you have to consider your people. OK, so let's say in year one, again, out of your two hundred, you paid one hundred for your people, including yourself.
Allison Williams: [00:15:28] In year two, let's say that two hundred became one ten that you paid to yourself and your people. Now that leaves ninety thousand dollars. You have ten thousand dollars less available to pay your people or rather to to pay your expenses separate from people and to benefit the business so you have less available in profit and you have less available for overhead. Well, overhead may change from year to year, but it typically does not go down. Right. We know that inflation. Cost goes up every year or over the course of time. Certainly over a five year period, you're going to see some inflationary rise in prices. But you also have to consider that as the evolution of law happens, right. The evolution of law is not something that we have any control over. To some degree, you don't have control over inflation, but you can respond to inflation by doing things in the instance. So a lot of people, when coronavirus caused quarantine, a lot of people cut back on things that they had some flexibility to cut back on. So you might say to your paper supplier, I need less paper because we're now filing things electronically because everybody is working from home. Or maybe we're transmitting things by email. So I need more ink for my scanner and not my printer. Different contracts, different costs. Right. So you can pay it. You can start playing with your expenses as necessity allows. And if you have contracts that allow for flexibility, hey, more power to you. That's great.
Allison Williams: [00:16:56] But there's only so much you can do that without cutting the quality in your business. You can cut costs to a certain degree, but when you start cutting costs that are also investment costs, like, if you start cutting your marketing budget and thus you are investing less in marketing, fewer people will know about you. Fewer people will be coming into your business, and you're also going to cut off your arm to spite... You cut your nose off to spite your face. That kind of situation. But you can do that to a certain degree when you are only experiencing a slight increase in inflation. This is like year one. Year one of two hundred thousand dollars year after year. Year two. Right, yeah, you're starting year of two hundred thousand year one or the first year after that at two hundred thousand. Let's say a third year in a row. You're also at two hundred thousand dollars. OK, again, you're going to have expenses. Now this year instead of it being one hundred thousand like in your first year of business or one hundred ten thousand in your second year, it could be one hundred and twenty thousand dollars. Now, why is that? Well, part of it is just global inflation. So cost of things expanding over time. Part of it could be that you're going to experience a rise in costs because of the talent that you add.
Allison Williams: [00:18:14] So we know that in the legal profession, lawyers turnover on average once every four years, paralegals turnover on average once every three years. OK, so when people are turning over and you go out and look for somebody to replace that person, you might look to save costs by hiring somebody at a lower price point or the person that shows up that's perfect. The role might be very experienced and they might require a higher price point. So you might have a cost increase in the cost of compensation in that regard. Well, one thing that we know that historically has gone up every year, at least over the last 15 years, is the cost of health insurance. So if you provide health insurance and most companies, most small companies attract talent in part through benefits because it is less expensive for me to provide a benefit. Right, I, I pay five hundred dollars a month toward health insurance for an employee. That five hundred dollars a month is five hundred dollars out of pocket. If I pay that same person that five hundred dollars, I'm going to have to pay a 15 percent payroll tax on top of that. So I'm actually going to end up paying more in cash than if I paid for a benefit, which is a write off for me as a business owner. OK, so it's less cash out of pocket for me, but there is still going to be an increase year after year.
Allison Williams: [00:19:37] OK, now there's other types of benefits that have less inflation. But we know that because of the way that the health care system works in the U.S., and we're not going to go into that politically charged conversation. But let's just say it's a shit show. And I don't know anybody who doesn't think it's a shit show whether you are conservative or liberal. Ultimately, that cost is partially borne by the small business owner and the large business owner. But the business owner that we're talking about right now is a small or solo law firm. So that cost is going to go up year after year. Right. So you started off with one hundred thousand dollars after you paid yourself and your team one hundred thousand dollars. Year two, you had 80, pardon me, you had 90 left over after you paid out one ten. Year three, you had 80 left over after you paid out one twenty. So you see that if your revenue remains flat, then the cost of inflation is going to deplete what you have available to run your business. Unless, of course, you give yourself a pay cut, which nobody should want to do, and you're going to reduce your profit, which means you're going to have less available to grow and sustain and reinvest in the business in future years. So it's a double whammy, right? You have less available for yourself and you have less available to the business because you are paying the same rate of expense, right? The same level of compensation, but with the cost of living adjustment, the same types of expenses in the business, but with that inflationary cost built, then you're going to have less available.
Allison Williams: [00:21:07] And we know that failure to grow will inherently then compress wages because labor tends to be the most expensive part of running a professional services firm. Rent is pretty high up there. So for those of you that have anything other than a truly purely virtual business and I mean virtual as in you're not renting office space anywhere. You're not renting a conference room. It's just you in your living room. And that's and that's your model. If you have anything other than that, then you have a cost of people and a cost of rent. But the cost of people, major expense. So the people then become a way that you seek to cut your costs or if you don't seek to cut your costs or your people, oftentimes resentment builds up because the only person that you can unilaterally cut costs on after you have reached an agreement with somebody is yourself. Now, you, of course, as a business owner, could always approach your employee and say, I tend to... We're in an economic place where I had to cut your costs. But if you start to compress wages of your team and they don't sense that you are compressing your own wages as well, you're going to build up a whole lot of resentment.
Allison Williams: [00:22:20] And I know several law firms that lost staff not because they could not afford them, but because the staff felt that, oh, the partners are over here and yes, they run the business. And yes, they took on the risk to create the business. I get it. But I have only been part of this employment field for two years and now I'm getting a pay cut. Even though I make sixty thousand dollars a year, I'm going down to fifty thousand dollars a year. While the partner is still driving a Lamborghini, living at his beach house during the quarantine to make himself more comfortable, etc.. Right. And most people, by the way, that listen to this podcast are not in that category of person or in that category of economics. But there's always that thought of am I going to lose people if I start tinkering with money? So the only way that we end up tinkering with money is we either cut our own compensation as the business owner or we start trying to cut costs in ways that are harmful to the business, like cutting our marketing or cutting our investment on things that will generate a greater return, like cutting coaching, cutting sales, cutting trainings. So the things that will ultimately get you the greatest return is where you instinctually say, well, I'll still keep the lights on if I cut these things out, so I just won't cut them out.
Allison Williams: [00:23:42] OK, now we know that compressing wages is a problem, but if you start to think about the fact that your revenue is flat, you're either going to be under compensating your people because they're doing the same job and the cost of living has gone up, but their income has gone down relative to the fact that they're not getting a raise or you're going to be out of integrity with your employees and your expectations. So you're expecting a certain level of performance from them, but you are under compensating them relative to market forces because you're not giving them even a cost of living raise because you did not have the ability to do so. Now, that doesn't mean that you did something wrong if you don't have the economic ability to pay. You should not pay someone extra and take it or run into debt or poorly manage the finances of your business. But if you did not have, as a conscious objective, growing your business, these are the things that happen, right? You end up compressing wages or if you don't compress wages, you end up running up debt. OK, or the worst sin of all is that you under compensate yourself, you say, I'll take care of everyone else except myself, and then you don't put your mask on first. And next thing you know, you're in economic distress.
Allison Williams: [00:25:01] Ok. Item number three. OK, so we've covered in the necessity for growth, we talked about talent being attracted to opportunity. We've done some very simple math, i.e. wages stay the same, but inflation goes up every year. So there's less available net if you don't have more available growth. The third way in which we need to grow. The third reason that fuels our need for growth in the long term is that it is a human instinct to want more. OK, no one goes into a business, whether it is the owner of a business or an employee in the business and says, I want to earn less, I want to do less, or I want to create less as I age. And I want you to think about this, because this is true even for minimalists, right? There's been a movement, I'd say, over the past 10 years, really, but certainly more recently a spike and I'd say in the last five years where people are really talking about the idea of cutting back. Cutting back on purchasing, cutting back on stuff, the collection of stuff, the hoarding of stuff. Getting rid of all of the things that pile up in a house that you don't need. Right. And I find it funny that it came to me to talk about this topic, especially since I had made a commitment. I built my house last year in the pandemic and in August I moved into my home. And I made a commitment when I moved in that I was not going to allow the home to become overrun with stuff. I didn't want closets stuffed to the brim with clothing.
Allison Williams: [00:26:42] I didn't want to have shoes everywhere. I actually hired a move manager to help me de-clutter and throw out a whole bunch of stuff. And I still have three closets worth of shoes. That's a whole other topic. Don't judge me. I'm working on it, but I wanted to get rid of a lot of the stuff. And I said I'm not going to, like, put more stuff in this house than I need. And then in December, I'm feeling bad that I could not go on my international family vacation. I said, oh, screw it. I'll just buy a whole bunch of subscription boxes. So now I've got like a plant of the month club. I've got, like I've got my Hope box. I've got my bath and body products box. Like, I get all of these really, really cool subscription boxes. But the boxes take up space. And so I have recently recommitted like, OK, take what you need, take what you want out of the boxes and throw the box away. I don't care how pretty the box wrapper is. Don't care that you can use the box for something in the future. If you don't need it, it needs to go out. Right. So that minimalist thinking seems like you're actually in a state of retraction. But if you think about it, minimalism is still creating more. It is creating more space. It is creating more peace because we know that every object is energy. And so if you remove things from your space, you are removing energy.
Allison Williams: [00:28:09] And by the way, that's just a little brain pac. That's part of the reason why very successful people clean out their desk at the end of the day. Why? Because all of those objects being all over the place, they create a level of energy and there's a certain level of peace and calm that can come over you when you see a space that is clear, when you have a countertop that is clear when you're able to see the top of your desk and not see all the papers stacked up everywhere and all the books everywhere and all the computers everywhere. All the screens. Right. So there is something that is to be valued in creating that space, but that space is something that you create. You are taking things out by putting in more of the clearness and the clutter free area and the fluidness of having an environment where you can move around without having a lot of things taking up space in the environment. So I want you to just think about that, that even as we are in a state of creating by taking things away, we are still creating more of what we desire. Right. So when people clean up, part of that cleaning up is that we desire to have cleanliness. We desire to have more space. We desire to have more energy available to us. And our energy is fueled by having fewer things, taking up our energy like clutter in our environment. It creates more freedom for us.
Allison Williams: [00:29:36] It allows us to have a greater expansion of our thinking. So just think about that when you think about that when we are growing a business. The instinct to create more, if not just to create more money. So I know a whole lot of people that have a lot of resistance around the idea of money. You are probably not the people who are listening to my podcast because I do not have that resistance. But there are some people that listen to our podcast that are just kind of married their mind to the notion that they don't want more money. Right. Maybe they have a spouse who is raking it in and they're financially comfortable or maybe they actually don't have a lot of money, but they have committed themselves to a mindset that says, I don't want more money. Now, if I had that person live on the podcast, actually coach them, I bet we could probably uncover a whole lot of story that made money bad for them or negative for them. But for the moment, let's just accept at face value that money may not be the thing that a person is seeking. Right. That they don't really want more money. They still want more. Right over the course of time, the human moves forward in life by creating more for him or herself. And that could be more money. That could be more complexity in the type of legal work you handle. That could be more iterations of your business, i.e., you started off as just an estate planning firm and you wanted to add in criminal defense or you wanted to add in real estate or you wanted to add in personal injury and you started to see opportunities in the vast array of the different places where you ultimately could create.
Allison Williams: [00:31:19] And you started to seek that. You started to desire that. You had a thought that said, I want more of that, whether it's more creativity or more fun or more opportunities to work with other lawyers. It could be any number of things. But you don't want less over time, even if you desire to have less complication in your life. If you want to create a level of sanity that comes with systematizing, that is still about creating more of what you desire, not creating less. We don't create the opposite of the things that we don't desire. We create what we actually do desire. We pursue what we actually do desire, even when we are running away from something negative. It is because we are desiring something positive or at least something we perceive will be positive for us. OK, so the fourth reason why growth is a necessity in your law firm, is that when people fear growth, that is often fueled by a fear of abandonment. OK, now I know that that might be a little weighty for a lot of people to hear, and you might be thinking, well, what does abandonment have to do with growing? What does, what does one have to do with the other? So I want to break that down for you, OK?
Allison Williams: [00:32:41] This really deals with the idea that there are people that want growth and see a need for growth, but they're too afraid, right. Their energy becomes very constricted when they start thinking about growth. They get really tense. They start hesitating. They start rationalizing all the ways in which growth is not the right choice for them. I've got a child I can't possibly grow. I have a glutted legal market is too competitive, I can't possibly grow. I don't really want more money, so why would I bother with growing. All of those stories that we tell ourselves when we are avoiding something that we have a desire for? And by the way, the people that will argue you down most vociferously online are the ones typically who want growth and feel that they can't have it. So they have to zealously defend their belief that they should not be growing or that no one really should be growing, that people should be just satisfied with whatever they have. That belief system, is not truly a belief system. Because if they were just saying it, as a matter of fact, it would come across as a matter of fact. Oftentimes it comes across as very defensive. Right. That kind of I'm telling you what I believe and why what I believe is the right thing and why what you believe is the wrong thing and why other people's beliefs in the contrary is the wrong thing. When you start to see people energized around all of the negatives of what they want, what they're really doing is they're trying to justify it to themselves. And that comes from a lot of different places. But one of the ways that it is often fueled is by a fear of abandonment. So let's break that down. OK. Some people have had the belief that if I make more, I'll have to pay more.
Allison Williams: [00:34:33] Pay more in taxes or pay more in wages. Pay more in benefits. And ultimately, I'll take home less so while that might on its face sound illogical, you would be surprised how many lawyers would have actually said, and I won't I won't disclose the source of this, but I've had enough conversations with lawyers that I know that this is a very common fear that people will say, great, I'll make more money, but I'll end up paying more because they will raise my tax bracket or I'll make more money. But as soon as people in the business know that I'm making more money, they're going to demand more of a raise. So I have less or they're going to require, they're going to insist that we start adding benefits that are going to be very expensive and I'll end up taking home less. And incidentally, by the way, this is not intellectually false, right? This is part of the reason why scaling your business is almost always better than merely growing your business. So the lawyers that are out kind of on social media or responding to cold call emails with the tip and trick of the day, i.e. click here and you can find out how to make twenty five thousand dollars in one simple email chain and they click and they download that thing or they hear this, this idea at a conference and they take their their zealous notes and then they they go back and try to do it themselves. Part of the reason why they are doing it is that they believe that they can just stairstep their way into growth. And by the way, stair stepping is the way that we have been trained as a society.
Allison Williams: [00:36:15] So if you think about it, when you're a child, we started off in kindergarten and then you, after a year, you stepped into kindergarten, stepped into kindergarten from first grade, and then you stepped into second grade, and then you stepped into third grade and you stepped into fourth grade. Right. Well, skip grades, generally speaking, in some locations, it's still permissible to do that. In fact, one of the things that probably caused the only tension ever between my parents is that my elementary school wanted to advance me two grades and my mother absolutely refused because she had been advanced a couple of grades when she was in school.
Allison Williams: [00:36:55] And that caused her a lot of distress because she was emotionally immature relative to her colleagues or friends that were in the same grade because she was younger than them. So she did not want that for me. She refused to let them advance me in school. So skipping a grade wasn't an option. But that stair stepping, even if I had skipped from first to third grade or from first or fourth grade or whatever, I still would have been to some degree stair stepping. Right. You acquire knowledge and then you advanced to the next level and then you layer on that knowledge and you advanced to the next level. As opposed to what you do when you're in a business where you take your knowledge and you expansively add to your knowledge not because you stairstep your way. Even though some people are still doing that, they're stepping right. They're still out there spending hours on Clubhouse and on LinkedIn, just soaking up information so that they can research it all and be the knowledge bearer and then go delegate it instead of saying, I don't know how to do this, let me go hire somebody who can do this and they'll get there a lot faster. They'll get that rate of return on investment a lot faster than me taking my time, my weekends, my energy on something I don't know anything about. I'm not a marketer. Right. But let me just go learn how to do this real quick.
Allison Williams: [00:38:07] Taking time away from billable hours or producing flat work where I could actually be making money with what I'm trying to do. A lot of people have that belief. That's stair stepping. Scaling is almost always better, because if you go from one hundred thousand dollars to one hundred and fifty, by the time you pay taxes on that extra 50, by the time you get that cost of living increase of compensation to your team member, by the time you absorb the rate of inflation of the different supplies in your business. OK, maybe you went from the net that you took from one hundred, maybe you add five or ten thousand to it. That's great. An extra five thousand dollars. Nobody would turn that down. But it certainly is not taking home an extra two hundred thousand dollars. If you had grown by five hundred thousand dollars. Right? So you limit your ability to really enjoy the fruits of your labor if you just grow rather than if you scale. But how does this relate to abandonment? So first, people have a fear of losing money, right? Money often is equated with value and people will oftentimes have a belief that they're going to reduce their value if they if they lose money. So if they if they take money that they have created and give it out, there's a trigger that says I'm losing economic worth because I have less money available.
Allison Williams: [00:39:38] But there's also a little bit more to this, which is that by virtue of having more money, people recognize that you are being more, that you are doing more and that you're having more. And that often raises some internal cognitive dissonance about your self worth, i.e., who am I to make X dollars? And before you reject the idea that that's what's kind of going on, under the surface, I want you to really think about who in your life would be affected if you went from making one hundred thousand dollars a year to making a million dollars a year. How would people treat you? People that are foundational to your life. Your parents, your siblings, maybe even your spouse? I can't tell you the number of lawyers that I've talked to, especially women lawyers who when asked the question, how do you think your husband would fare if he went from being the primary wage earner, making one hundred thousand dollars a year in your household and you making 50 to all of a sudden you make seven hundred thousand dollars a year? Right. Intellectually, on the first day, on the first instance, some women will say, oh, he'd be fine with it. But then when you ask a little bit differently, you ask, OK, who's going to pay for dates? Who's funding 401K? Who's putting the kids to college? And the vast majority of that money is going to come from her. The ego, in terms of how we as a society value men, we often will attribute their value to the fact that they are providers.
Allison Williams: [00:41:12] If all of a sudden that dynamic changes, where, yes, he's still providing because he still brings home his income, but he's no longer providing at the level where he is necessary for the lifestyle of the family. That oftentimes creates a whole host of issues in a relationship. And a lot of women instinctually knowing that it will be a problem for their partner find ways to sabotage as they are growing because they would rather be in the comfort of knowing that that relationship is stable because they fear being abandoned, than being a person who provides more and all of a sudden the relationship is called into question. Or there's friction in the relationship or there's a question that the partner has, as to what his value is. Because there wasn't enough value instilled in him growing up that he separates his value as a human from his value as a doer, a value of I give my money, I provide for my family. So a lot of weighty stuff comes from growth. And I just wanted to throw out there the idea that a lot of times the need for growth is not just that we need the economic resources that come from that. But think about how much your relationship has to evolve and how much stronger you become as a partner as a result of having worked through that issue.
Allison Williams: [00:42:37] That there's a need, that both parties in a relationship become their highest and best selves, and if one person is suppressing him or herself in order to be in a partnership, that there is something that needs to be resolved within both partners and within the relationship in order that that not occur. And if you don't do the work to have that, yes, you can still hold on to the relationship, but at a cost to yourself. And then you have to ask yourself, is it really worth it? All right, number five, OK, we've covered several reasons why there is a necessity for growing in your business. We talked about talent being attracted to opportunity. We did some very simple math that wages will be compressed, as will your expenses and your ability to grow the business if you don't have more money year over year in order to invest in the business. Third, we talked about the human instinct to want more. Four, we talked about abandonment and that being an issue that people should work through, if that is something that is showing up in their relationship and as a result of their business growing. And number five.
Allison Williams: [00:43:44] The fifth reason why growth is a necessity in business is that most entrepreneurs do not burn out from doing more. They burn out from accomplishing less. Ok, hear me when I say this, I'm going to say it again, because I think it's one of the most profound things that you can come to terms with as a law firm owner. Most entrepreneurs don't burn out from doing more. They burn out from accomplishing less. Ok, think about that for a moment. It's not really that we are tired, that we are kind of chasing our tails, if you will. A lot of people don't mind putting in the work if they're getting somewhere. It's that emotionally deflating feeling of putting in the work year over year over year without having that return on the investment of your time, that you're putting in, and what you're getting out is a few pennies more.
Allison Williams: [00:44:54] Or you're putting in, and what you're getting out is the need to hire someone who commands a higher price point, even though you're too afraid to raise your prices so you're making less money. Or you're putting in and you're working more hours, but you're spending it on things that don't make money in the business. You're not learning how to sell. You're not marketing so you're not getting more leads, and you're taking your time on the legal work because you love the legal work and you love taking care of your clients. And it feeds your ego that your clients are saved by you, but it does not feed your bottom line that you are avoiding the skills that are going to drive in clients and drive up revenue. All of that extra that you're putting in and getting nothing more out is the reason why lawyers will often burn out, not that they are doing more, but they are doing more to stand still. Right.
Allison Williams: [00:45:45] If I can drive five miles an hour and get to the same place that I could get to if I drive 50 miles an hour, why would I ever choose to burn up my gas driving 50 miles an hour? I'll just roll along at five. And that is one of the reasons, one of the key reasons why lawyers will ultimately stay small in a law firm. It's not that they don't know how to grow. Part of it is that they don't know how to grow right. Part of it is that they need someone to assist them or else Law Firm Mentor wouldn't exist. We exist because lawyers need the how to of getting themselves from point A to point B, but it's often that they know how to grow. But what they won't do is they won't get out of their own way to do so. So the things that they have to invest that 'more' into, are things that trigger them. They have to invest the more in learning how to sell. They have to invest the more in learning how to market. They have to invest the more in learning how to become a better leader and a better manager so that the people that they are bringing in can function effectively to get the work done systemically and efficiently at the highest rate of profit.
Allison Williams: [00:46:53] It is when lawyers invest themselves in that work that 'more' that they're investing turns into more dollars, more time and more freedom. And that really is what all law firm owners are looking for. I've never met a law firm owner who doesn't want more money or more time for their business. And more money and more time equates to more freedom. All right, everyone, I am Allison Williams, your Law Firm Mentor. We have been talking about the necessity of growth. And if you are somebody who wants to step into the next level, the next iteration of your law firm, and if any of this landed for you, I want to invite you to reach out to a member of our team so that we can talk to you about how Law Firm Mentor can help you to grow your law firm. We'll put the link to the scheduler where you can get a hold of us into the show notes for today's episode. Again, I'm Allison Williams, your Law Firm Mentor. Everyone have a great day!
Allison Williams: [00:48:01] Thank you for tuning in to the Crushing Chaos with Law Firm Mentor podcast. To learn more about today's guests and take advantage of the resources mentioned, check out our show notes. And if you own a solo or small law firm and are looking for guidance, advice or simply support on your journey to create a law firm that runs without you, join us in the Law Firm Mentor Movement free Facebook group. There, you can access our free trainings on improving collections in law firms, meeting billable hours, and join the movement of thousands of law firm owners across the country who want to crush chaos in their law firm and make more money. I'm Allison Williams, your Law Firm Mentor. Have a great day.
Allison C. Williams, Esq., is Founder and Owner of the Williams Law Group, LLC, with offices in Short Hills and Freehold, New Jersey. She is a Fellow of the American Academy of Matrimonial Lawyers, is Certified by the Supreme Court of New Jersey as a Matrimonial Law Attorney and is the first attorney in New Jersey to become Board-Certified by the National Board of Trial Advocacy in the field of Family Law.
Ms. Williams is an accomplished businesswoman. In 2017, the Williams Law Group won the LawFirm500 award, ranking 14th of the fastest growing law firms in the nation, as Ms. Williams grew the firm 581% in three years. Ms. Williams won the Silver Stevie Award for Female Entrepreneur of the Year in 2017. In 2018, Ms. Williams was voted as NJBIZ’s Top 50 Women in Business and was designated one of the Top 25 Leading Women Entrepreneurs and Business Owners. In 2019, Ms. Williams won the Seminole 100 Award for founding one of the fastest growing companies among graduates of Florida State University.
In 2018, Ms. Williams created Law Firm Mentor, a business coaching service for lawyers. She helps solo and small law firm attorneys grow their business revenues, crush chaos in business and make more money. Through multi-day intensive business retreats, group and one-to-one coaching, and strategic planning sessions, Ms. Williams advises lawyers on all aspects of creating, sustaining and scaling a law firm business – and specifically, she teaches them the core foundational principles of marketing, sales, personnel management, communications and money management in law firms.
Allison references that the scheduler will be in the show notes to reach out and schedule time to speak with a member of our team.
Contact Law Firm Mentor:
00:43:44 Allison Williams (50 Seconds)
The fifth reason why growth is a necessity in business is that most entrepreneurs do not burn out from doing more. They burn out from accomplishing less. Ok, hear me when I say this, I'm going to say it again, because I think it's one of the most profound things that you can come to terms with as a law firm owner. Most entrepreneurs don't burn out from doing more. They burn out from accomplishing less. Ok, think about that for a moment. It's not really that we are tired, that we are kind of chasing our tails, if you will. A lot of people don't mind putting in the work if they're getting somewhere. It's that emotionally deflating feeling of putting in the work year over year over year without having that return on the investment of your time, that you're putting in, and what you're getting out is a few pennies more.