Practice Management

The Third Wave is all about flattening management structures.  Therefore, when I read this article about Neil Johnson getting rid of his managment to improve business at International Merchant Services I knew this would be enlightening.

Before starting International Merchant Services Inc. in 1992, Neil Johnson worked in a number of areas, including sales, but had no management or business experience, much like most lawyers that go into the business of law.  So, at his automatic teller machine products and services company he thought the answer was to hire others (a lot of others) to help him manage his growing company.  He added layers of management, which only complicated his company.  This, as it always does, began to isolate him from his employees and customers.

I have always thought that lawyers want to be isolated from their employees and clients and that is the reason they grow these strangely configured firms with palace guards stationed at every step.  But, the more that I think about it, it is that fear that lawyers lack the experience and, at least early on, they feel they need in both business and the practical practice of law.  They feel self-conscious about it, and doubt their own abilities to think through issues, and they hire staff to handle in this day and age what most attorneys can do for themselves.  Then as they add structure they simply cannot let go of the status quo.

But, Neil Johnson came to recognize the problem and did something about it for the improvement of his company.

In his company with the addition various layers of management, employee moral began to suffer, customer complaints were on the rise and sales were flat.  Sound familiar?  This called for action, and he had to admit that bulking up on management was not helping.

He began to eliminate one layer of management after another.  Then in 2006. things began to improve, more requests for proposals started rolling in and the deals are even larger than before. The excitement had returned.

It really takes a leap of faith to make these decisions, but they are so vitally necessary.  Lawyers need to get rid of the staff, management and others that only slow or complicated the firm and isolate the lawyer from the client.  And, do not forget, that it is expensive as well.  It represents money, much of which could be going into the lawyer's pocket.