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Hurricane Harvey

Leading Your Firm After a Disaster: Hurricane Harvey

Does your firm have a disaster and recovery plan? Here are some items to consider including in your plan.  In the wake of Hurricane Harvey, many business owners have reopened their doors and are attempting to resume normal business operations. However, considering the tremendous impact that the event had in our region, it is probably safe to assume that there may well be a new normal for some time to come. Supporting your staff during and after a catastrophe requires lots of compassion and understanding. Also, be mindful that stress levels will be high during the recovery period. As a business owner, manager or team leader, there are several steps you can take to help your employees manage their new challenges and make the transition back to work as smooth as possible: 1) Assess Basic Needs – By now, management should have made contact with every member of the staff and taken stock of their situations, as well as what they may be dealing with regarding their homes or their loved ones. Some of your employees may have come through the storm rattled, but unscathed. Others may have lost everything.  Find out who may need shelter, food, clothing, transportation, pet care, child care, a rental truck, storage space or any of the many goods and services they need to begin normalizing their lives. Provide them with contact information for aid groups or any support that the firm or coworkers can offer. The sooner they can address their basic needs, the easier it will be for them to try to return to their normal lives. 2) Provide Ongoing Communication – Voicemail, email, company intranet or social media are all useful means to keep employees apprised of any company updates throughout the response and recovery phases. Remind your team that their jobs are important and secure. Provide regular and clear communication with updates on the business’ restoration progress. 3) Make workplace adjustments – Once the office is safe to return to, management may need to adjust some office rules and procedures. Dress codes, rules about children in the office, and restrictions on using telephones and the Internet for personal business may all need to be temporarily adjusted in the post-disaster period. It may be difficult for staff to get to and from work on time with new traffic patterns and gridlock on the freeways. Flexible hours or allowing your employees to work remotely may alleviate some stress around these issues. Employees may also need unexpected time off to address their home and family situations. Compassion and patience about these business interruptions will be remembered and appreciated by team members. 4) Maintain physical health – Exhaustion and stress can lower resistance to disease, decrease alertness, and cause impaired judgment. After an initial crisis period, observe employees for signs of physical, mental or emotional exhaustion.  The same employees who work all day diligently may be returning home to many more hours of work to repair or reconstruct their homes. 5) Encourage mental wellness –  It is important to encourage discussion as survivors of disasters often need to talk about what they have experienced. Consider providing an information break area where employees can gather for lunch or breaks with their co-workers. If your firm offers an EAP program, provide your employees with an update of what it covers and how to schedule appointments. Collier Legal Search is here for you and can help answer any staffing questions you have during this recovery process. We support you and continue to keep you and your families in mind during this difficult time.

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The Dilemma of Mid-Sized Law Firms

Mid-sized law firms are getting squeezed by these external and internal factors. Sustaining a successful mid-size law firm in today’s legal market is challenging. In 2016, many mid-sized firms decreased in size, became unstable or simply dissolved. Surviving firms in this category realized only a minuscule increase in gross revenue. The most recent Am Law 200 figures show that the Second Hundred, as the Am Law 101 to 200 are known, struggled in 2016. This group includes mid-sized national players, regional firms, prestigious specialist firms, as well as local law firms whose operations are focused on their home state. For nearly half of these Am Law mid-sized firms, growth has evaporated, and profits are declining. Here are some of the external and internal factors that are squeezing the mid-sized law firm: EXTERNAL FACTORS Client pressure Clients are demanding greater value and transparency for their legal service expenditures. This has led to shifts in the traditional billable hour pricing model as clients insist on fixed or flat fee work, or enlist third-party billing review companies to reduce their legal fees. Additionally, corporate clients often require their law firms to add administrative staff to comply with more complex billing, reporting, and compliance requirements. Fundamental market shift Certain consumer market segments are substantially reduced or simply gone. Estate plans and incorporation documents are frequently provided by legal internet services rather than an attorney. Corporate clients are increasingly likely to divide responsibilities for different aspects of a single matter to various law firms, in-house lawyers, or non-traditional vendors. In-House continues to grow More and more corporations are expanding their in-house legal departments, a trend that has been accelerating for years. The growth of in-house capabilities and the work these groups are prepared to handle has significantly reduced the role of outside legal representation. There are fewer publicly traded companies With fewer publicly traded companies, there are fewer potential clients. Landing an account with a large corporation today is more lucrative and will involve more work, but there are fewer such accounts to go around, and they are overwhelmingly represented by the large firms. INTERNAL FACTORS Partner Problems Many firms have too many partners and not enough work. Some partners do not contribute equally to revenue generation and some should have already retired, but can’t or won’t due to financial constraints. For a mid-sized law firm, this kind of top-heavy structure severely hinders profits. Losses are managed by cutting support staff and associates, making it even more difficult for the firm to compete. Escalating Costs Rent, health care, insurance, utilities, taxes, and compensation are just a few examples of costs that creep up each year. In the past, law firms would raise their rates to cover annual increases in expenses. In today’s market, these rising costs can’t always be recouped by higher legal fees because clients will demand savings or services in other areas. Not running the firm like a business. While some firms have management committees with strong business backgrounds, many do not. Most mid-sized law firms are started and led by attorneys who are dedicated to the practice of law but may be lacking in business experience. While this traditional law firm structure may have worked in the past, it is no longer compatible with today’s fiercely competitive market-driven environment. Avoiding change and continuing to think that the market will one day recover to pre-recession levels is a recipe for failure. Local Firms Are the Exception One bright spot within the Am Law Second Hundred shows 90% or more of their lawyers located within their home state, and was also among the strongest performers within the Second Hundred, even outperforming national firms.

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