It will never be an academy award winner nor draw accolades from outside of the firm. But to each professional services firm, the success of an entire year culminates to the deposits of the last 10 days of the year. It is so astounding how a multi-million dollar operation puts its future in the hands of a few and it all comes down to precious days! In the past week I have spoken with a few firms who refer to this time as Miracle of December, they recognize time not by the calendar, but by deposit days. The sad thing about it all, it doesn’t have to be this way. However, history continues to repeat itself. Where trained professionals do not manage collections and it is something that is done in the latter part of the year.
I won’t use this time to harp on what should be done. Rather I want to spend some time talking about choices. I have learned over the years that life is a series of choices, none right, and none wrong, simply choices. To that end, we set out goals and go about our means to achieving them. Whether the goals are valid or realistic is not important, they are our goals and therefore we pursue them. It is in the methods we use to pursue our goals that makes us unique.
As you may have picked up from past writings, my feeling is that AR Collections is a service to our organizations that we must provide each and every day. We must be diligent in obtaining what is rightfully ours and doing so in the most respectful and professional manner. This, I feel, is achieved in those organizations that are full or modified accrual.
With that said, firms need to drive their bottom line. They need to achieve the level of profitability necessary to continue operations, to grow and to take advantage of new opportunities. Firms only have two options in driving the profits they need to be successful. They need to generate more revenue, which must get paid, or they need to cut costs. Recently I have spoken with a few firms that have done all they could to generate more revenue. They had gone so far as to put a bounty on billable time, 75% bonus for 3,000+ billable hours per year. However, after 2 years of this and attorneys at full throttle, the next logical step was to cut costs. The cost cutting endeavors will span a few years as the reorganization takes root. However, I feel, in time this will too hit the wall.
Hitting the wall or the proverbial glass ceiling is the spot, I feel, many firms come to when it deals with profitability. They try increasing the top line, the billable hours. They try different things on collections, sourcing and outsourcing. They try these quick fix reorganizations. Sooner or later, the glass ceiling sets the limits. The true limits may not be discerned, they may be hidden in inflationary adjustments or some windfall. They are there!
Breaking the glass ceiling is not done with reengineering the processes of operation. It isn’t in ‘changing client intake’ or having more Power Point Slides at the partner retreat. It is in making an inherent change in the way the business is run, that is right – the business. It is a business and should behave like that. A recent conversation with a colleague made it clear, that his firm was not run like a business. He jokingly said, “Our firm is more like a ‘mom & pop’ shop.” Here is a firm that spends millions in meetings upon meetings, retreats, think tanks like Business Process Reengineering (BPR) and the idea that is left in the minds of all the employees is that this is a mom & pop shop.
The hammer that breaks the glass ceiling isn’t in all the quick fix. It comes when firms realize that there are better business managers than attorneys, there are better business strategists than partners, and better visionaries than the managing partner. The business and the vision of the firm should be shared by all and managed by a visionary. The power of propulsion must come from the attorneys and the entire team.
In the right environment, everyday is a successful day. Why should you wait and deem success in the last 10 days of the year? It is your choice! Sadly, I don’t think the time is ripe for firms to make this change – this paradigm shift!