Financial Advisory Blog

Armanino’s Financial Advisory blog is your source for thought leadership around cloud ERP and accounting solutions and integrations. Supported by the Cloud Accounting Institute and numerous experts in cloud, finance, reporting, integration, compliance, and technology, Armanino’s Financial Advisory blog features must-read content on what’s happening in the finance industry, case studies, white papers, and much more.

November 9, 2020

The Covid-19/PPP Coma is lifting for Law Firms – Now What?

Posted by David Roberts, CPA

Law Firms

Many Law Firms had “issues” way before we knew anything about Covid-19, and if we can say anything for sure about this pandemic, it’s become the great “accelerator.” The great accelerator of many issues we could only lightly discuss before – issues that were on our checklist before this all happened such as:

  • Should we allow employees to work remotely? (Done)
  • How do we cut our discretionary expenses, such as our travel and entertainment budgets? (Done)
  • Space is getting so expensive – can we/should we reduce our real estate footprint? (Done)
  • Can we somehow reduce our administrative staffing and still get by? (Done)
  • How do we get our partners to focus on collections? (Done)

So, we can thank this pandemic for helping us to make some long-overdue changes. But what about all the other issues that are still on our punch lists?

  • Dealing with under-productive partners
  • Managing partner retirements
  • Succession and leadership transition issues
  • Addressing partner compensation methodology
  • Defining a firmwide strategy
  • Assessing current use/future investments in technology
  • Becoming more data and analysis-driven to advance the business
  • Developing organic and inorganic growth strategies
  • Developing market-based pricing strategies

This pandemic is not like the 2008/2009 financial market crash. It is deeper and longer-lasting, affecting various sectors of our economy in very significant ways. Law Firms typically lag behind the industry when it comes to change, but they can’t afford to sit and wait for this one out. 

We can’t entirely predict the future, but it almost certainly will involve a rapid evolution of how law firms do business – both on the operational side and the delivery side. This type of wholesale change is unsettling and can create fear, uncertainly, and doubt (FUD) – but along with it, tremendous opportunities for those firms who are ready to seize the moment. 

The key to moving from the paralysis of FUD towards a successful evolution will be Leadership. Leadership that can see the opportunities, set a vision, make the tough decisions, get their people on board, and keep it all glued together through the uncertainties that lie ahead.

Of course, it is a lot easier to do nothing or to “wait and see” what happens.  In today’s world, I would be very concerned about relying on hope.  Hope is not a strategy. This will not conveniently “go away” just by virtue of ignoring it.  The longer you wait, the tougher and more critical the issues will become. Take the necessary steps now, and you’ll be setting the course for an exciting new vision of your firm. 

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