Profitability Factors: Client Selection

Client Selection -- lawyers, particularly in small firms, struggle with this area of the management of their practice. Yet, the selection process is a critical step in a successful representation and should not be approached in a haphazard manner. This is the first area I look at when evaluating a firm's financial health. So, how do you get this critical first step right? Here are some tips for employing a successful client selection process:

Step 1: Determine what type of practice you want to have: Ask yourself these questions, among others.

• What type of people do you want to work with; i.e., elderly, criminals, plaintiffs, suits?
• What kind of work do you most enjoy doing; i.e., preparing for and going to trial, negotiating a contract, mediating between a husband and wife?
• Do you have the expertise and/or experience to do the work you think you'll enjoy?
• Can you make a living at it?
• Will it provide you the life/work balance you need/want?

Step 2: Write a client selection policy and put the following lists in them.

• Make a list of character traits a client you select must have; i.e., honest, cooperative, reasonable expectations, able to pay your fees.
• Make a list of the character traits you wish to avoid; i.e., the opposite of the above.
• Make a list of the case facts that must be in place for the client/matter to be selected.
• Establish a policy for allowing associates to select clients. (I would discourage this unless prior approval from one or more partners has been obtained.)
• Determine what client selection decisions have to be made by the partnership vs the partner to whom the engagement has come.

Step 3: The interview

• Check for conflicts
• Check list of requirements for client selection against interview findings
• Has the prospective client sought and been turned down by other counsel?
• Observe and note your impressions of the client, strengths and weaknesses of their matter.

Step 4: The decision

• Does the client's matter meet all qualifications outlined in the client selection policy?
• Does the client meet all qualifications outlined in the client selection policy?
• Will handling the matter be profitabile or does it offer some other value to the firm that will support the cost of the representation?
• Does the firm have the resources at hand (cash and labor) to profitably and competently handle the matter?

Step 5: Document the decision in either an engagement letter or a non-engagement letter.

If you will incorporate and comply with these simple steps in your client selection process, your practice will become more profitable and more enjoyable.