The Necessary Weeding Out: Resetting Expectations to Build a Stronger Firm

Sometimes we do things to ourselves where it's like we're riding on a bicycle and we can't ride any faster. And sometimes it just feels like with a change like this, that you are putting down the bike and you're going to get in the car. And then you could actually cruise and go, like go the speed you want to go. And that's what this feels like when people weed themselves out.

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Hi, everyone. Welcome to this week's episode of The Law Firm Owner Podcast. I'm so glad you're here. Last week, we talked about the inevitability of people leaving your firm, team members leaving your firm. Someone will put in their notice. It may be a surprise. How you deal with that is everything in terms of your ability to move forward and recover quickly and capitalize on the opportunity that it is. You know, I'm not saying that you wanted that scenario, that you would choose that scenario, but if that is what is happening, you should look at this as an opportunity. And so we talked a little bit about that last week on the podcast. 

Now, today, I want to take this a little bit further, a little bit deeper because I see this a lot, a fair amount, I will say. It's not like every single client that comes through deals with this, but a lot of clients do deal with this. When someone comes to Velocity Work to work with us, they are inevitably cleaning up things. There are oftentimes expectations that weren't set well enough with the current team that they have, or sometimes the arrangements that were made were not something that the business can really afford, so to speak.

It could be categorized into those two things with what I'm really talking about today. But when someone comes to us, they are getting clear. We are able to show them what doesn't work. We're able to show them what is working really well. We're able to kind of highlight that they don't have some of the things that they need in place. And that may be connected to vision and really what they're trying to do here with this firm. It could be related to culture. Like they don't have an intentional culture there. It could be related to that. 

But we're showing them, and the reason we're showing them is because we've done all the work to have that insight. We have all kinds of data. We have interviewed the owners. We have had calls with them. We understand how the work is distributed in the firm because of the work that we do with them. And so, we really do know what we're talking about when we talk to the owner about their firm.

And sometimes because of all of the different angles that we've looked at this business through, we're able to help the owner see their business in a light that they couldn't have seen before, which is really helpful for them in order to make decisions, et cetera. 

And so, when they come to us, and we find out what's not working well, what is working well, where there's holes, you know, things that haven't been thought through. And we sort of surface all these things and decide what matters the most. What would have the biggest impact if we either course-corrected or implemented or whatever. 

One of the things that comes up a lot for firms that have made arrangements with people that are not working for the firm, for the health of the firm. And again, this goes back to those couple categories, is because expectations weren't set as in a way that they needed to be in order for this arrangement with the employee to work, or it's that there were expectations set, but they don't line up with what is okay for the business given what you're paying this employee. And so there's just arrangements, it's just arrangements that have been made.

And so when you bring these things to light and you have a conversation with the owner about, "Okay, how do we want to handle this? This is status quo and we can't keep this going. It's killing your business." Or, you know, for some, maybe it's not killing it, but it's creating this really leaky business that you can't, that's not healthy. You're not going to be able to get healthy with this arrangement in place. Something's going to have to shift, something's going to have to change. So we'll have that conversation and it depends on their scenario, et cetera. 

But what comes out of that oftentimes is expectations need to be reset. If there is a firm that either it could be flat fee or hourly. Hourly is the easiest to point to, but you can also do this for flat fee. If the hours every month being hit, it's a generous full-time salary, but billable hours that are 60 a month. I don't know; maybe they're not set there, but that's what's happening. The producer is producing 60 billable hours a month, but they are getting a 150-plus salary. That's not going to work unless their rate is, you know, a thousand dollars an hour, 800 bucks an hour, but that's not most of my clients. So it doesn't work. So we either, we have to reset expectations about the number of hours that will be hit in a month, for example. 

There are times where, with flat fee, if it's estate planning, there are a certain number of new estate plans and signings that need to be happening in any given month and new clients or signings. And that has never been established. It's just kind of like, "Let's just go. We're busy."

But when you really look at the numbers, things aren't organized in a way that allows enough to be funneled through that producer so that the firm can be earning what it should be earning given what you're paying the producer, right? That's a way to look at it. By producer in that instance, I would, yes, normally mean attorney. 

So there are things to look at. Now, once we make some decisions about what feels reasonable, even if they have some fear about going back and having uncomfortable conversations, et cetera, they get to, the owner gets to a place where they see like, "Okay, I think this is reasonable." So if this is reasonable, I need to tell them that's what's expected moving forward. And we've done the math together to see what's needs to be true, and with what the owner says is reasonable for that firm and for that producer to do, let's just use billable hours because it's easy in this moment. But again, it doesn't have to be hours.

If the owner feels like that's reasonable, we play that math out to the end and make sure it's a healthy producer multiple because that matters a lot for the health of the business and making sure that the money coming through the door is enough to go around for to pay for everything in the business, not just the people who produce the work. We do all those checks and say, "Okay, this feels like a really solid plan."

And so, then one of the strategic priorities is to go back and reset expectations with certain team members and get them up to the hours or the matter numbers or whatever the firm is dealing with, to get them up to what they need to be to so that the firm can be running in a healthier way just financially.

This can be hard. If someone has been working with a certain set of circumstances and they've just been doing that for a while and no one's had anything negative to say about it, and then all of a sudden you go back and you're going to bump their hours, that can be hard to hear. And I always talk to the owners about like, "That might be hard to hear. You need to expect that they may not have the a warm reaction to it." 

The truth is what I witness a lot is that, I mean, that's just human psychology. People do have a hard time swallowing that. It's like, "Wait a minute, what? I've been here for three years, making what I'm making, and now all of a sudden you're telling me I have to work more to make what I make? That doesn't, I'm not good with that. That doesn't feel right." So that's what happens a lot, and this is just human psychology. That's what this all boils down to.

So you do have to find your way through that conversation with as much grace and as elegantly as possible and be transparent about the fact that the arrangement that's been set up, it isn't working for the firm. And that's why there's a shift now in terms of expectations. 

I think it's very important to acknowledge that they might feel like this is unfair to say. I understand how you could feel that way. But the truth is, I have to make a decision for the health of this business, and I don't want you to go anywhere. I would love it to stay you. But the truth is, the arrangement needs to be different for this firm to be able to thrive and to be able to afford the things that we need to afford, non-producer positions, technology, et cetera. Like, a lot of these places are growing and so they need to move up and so their rent is going to go up. And so like things like that come into play.

And the owners are totally handicapped. They're not able to go do those things because there's not enough money coming in. The money coming into the producer is barely covering the producer. So there's not enough for the business to be able to thrive and grow in the way it needs to so it can continue to take care of the people.

This is going back to engineering generosity. Yeah, it's like, "Okay, now, this is an owner who maybe didn't engineer generosity prior and now has to." So now they're going back to the team and they're going to engineer generosity. If you don't know what I'm referring to, it was just- we'll put it in the show notes- but it was an episode just, you know, a month or two ago.

But now they are having to engineer generosity and no matter how you say it, no matter how hard you work to tell the truth, right, about the expectations they're going to be set from now moving forward, but also to do it in a way that knowing that it's going to be hard to hear, it very well could be hard to hear, but telling the truth anyway. And no matter how hard you work to really try to meet them where they are, they're likely not going to like what you have to say.

And in those moments, what I want you to understand is that if someone walks away from your firm, if they put in their notice or if they just flat-out quit and leave because they don't want to do that, they're saying no to what you are putting down in terms of expectations, no matter how kind and elegant you walk through that. There's a very good chance they're not going to like it, and they're going to say, they're going to opt out of it.

And what I want you to know is that is an important happening. It can be and feel very scary the first time you start to really shift things so that the business can be healthy. And when you do that, there may be fallout from doing that, but it is necessary and it is an opportunity. It is your chance to actually do things differently now moving forward.

Now, every once in a while, you will approach somebody with these new expectations and they'll say, "Okay, you know, I understand. Sounds good." And then your job is to keep connected to them on a regular basis, usually initially week over week because it's such a new normal for them. They've never had those expectations before, so it's staying connected to them weekly to see what were they able to do the previous week? Did it hit the expectations? If not, what are their barriers?

Work with them on their barriers, like stay connected with them so that they can succeed in this. They said, "Okay." So now their job is to succeed in this and your job is to support them in succeeding in this. That's great. And that can move forward and that is you starting fresh with the same person and expectations.

But what I want to say is and the point of this episode, which it feels like it took me a while to get here and I'm sorry, but I just want to give context enough that you really understand what I'm trying to say.

When you make the right calls for the health of your business, people will weed themselves out. Scenarios will weed themselves out that do not serve this business anymore. And do you know why that is? It's because you finally are putting down boundaries for the health and for the sake of the business. And when you do that, people can choose to either get on board or get off board, and people will get off. 

So expect it. You know, we talked about last week about people are going to leave your business at some point. Like that's just the truth of it. And if it really rocks your boat, there is work that you have to do there to enable you to move forward in a better way, in a more productive way in those moments.

But this week I'm talking about when you learn new things about your business, when you see things that you can't unsee, when you have new understandings, and so it helps inform decisions you are going to make, you're going to walk back into that firm and you are going to, and you should, you should prepare how you present this. You should make sure you're doing it thoughtfully, but do not soften the message, although you can soften how you say it.

You have to tell the truth. It has to be clear. If it's not clear, you're not doing a good job. So clear, remember, clear is kind. So be clear. And if you are clear and you are understanding of a reaction that may not be all rainbows and daisies, you may be met with resistance. Expect that. And if it was you on the other side, you would feel the same way. 

Regardless, these expectations need to be met. So give room, like, how you present it matters, but when you do it, you have to hold the line. And you having boundaries and saying, "This is what it's going to take in order for this arrangement to work. This is what it's, in order for you to hold the salary that you've got, which I would love to continue paying you. And I would love to give you raises in the future, right? But these are the things that need to happen in order for any of that to be on the table."

And as you talk through that with them, and this episode is not how to have that conversation. That's not what this episode is, but when you lay the boundary down, when you set the expectation clearly with them on what is expected going forward, they likely are not going to love it. Give them space not to love it and give them space to make a decision if they would like to continue on knowing that these are the expectations or not.

And if you would like them to continue on, then tell them that. Tell them how much you value them. Tell them how much you want them to be in this role, not somebody else, but this is what needs to be true in this role. And give them the space to make the call because people who are uncertain, who people who they are dragging their feet forward and their attitude isn't good about it. Like you don't want them in there.

So they, you need to let them decide. Do they want off this boat or they want on? Because you're sailing somewhere new and it's healthier. It's going to be better for everybody. But yeah, the expectations have changed. And they need to weed themselves out if they do not want to continue on.

And again, there is opportunity here. If they do not want to do this and they remove themselves from your firm, then that means you have an opportunity to bring someone on and set the expectations from the get go about the healthy scenario for the firm. And everybody wins. So it is an opportunity.

And I think sometimes when people leave, especially, especially the firms that I'm just starting working with and I don't want their whole team to leave. Like, that's not the goal. The goal though, is to have a scenario set up where they, the firm can actually be healthy. That needs to happen. 

So when someone learns all the things about their business that they can now see because of our work together, then they go back, and it is frightening. It is so frightening to basically risk losing key team members because of these expectations that are being in place.

And I'm telling you, if that is what needs to happen, if that is what if they decide to leave, it is the best thing that could happen to you and your firm. Because now you have an opportunity to build something that can be generous to its people and be generous to you as the owner and to your clients. Like everybody wins when you have the right arrangements in place. 

So weeding out is important. Last week was about people are going to leave your business and your emotional reaction to that matters and we talked a lot about how to move yourself up the scale to have things be more objective and one foot in front of the other more quickly, right?

This is true. It holds up here in this conversation too, but the point I want to make is when you go back and make changes, there is a risk that people will leave because they do not like the changes you're making. And that's okay. Not only is it okay, it is a very good thing because the sooner that those people leave and it leaves opportunity for someone to come in and you could set proper expectations. Now, now we're cooking with gas.

Sometimes we do things to ourselves where it's like we're riding on a bicycle and we can't ride any faster. And sometimes it just feels like with a change like this that you are putting down the bike and you're going to get in the car. And then you can actually cruise and go, like go the speed you want to go. And that's what this feels like.

When people weed themselves out, I know because I have this perspective and I have seen so many scenarios play out. I know that the owner is now putting down the bike and getting into the car. They can't always see that yet, which is why it's so frightening. There's all kinds of uncertainty in front of them and they haven't dealt with this before. But I have, I have seen it lots. Doesn't mean it's a cakewalk, but everything gets better from here as you move forward. Everything. 

And that can be hard to see when you are going back to the firm and resetting expectations. It can feel scary. There's all kinds of uncertainty. You're worried if they leave. And you know, it's not just one person sometimes; sometimes it's, you know, two, three, four, five people who could easily say, like, "I am uninterested in this."

And I work with, and I navigate with the folks I'm, the clients that we have, how to handle those situations and how to go about it in a way that mitigates risk as much as possible, but also protects the firm and moves towards protection in the firm. 

And I've seen both sides where someone, they do leave, and I've seen it where they stay. And it's fine. And actually, the person that stays and starts meeting expectations, they get paid more in the end because the firm is able to give them raises because it's just not a big deal to meet the expectations that the firm set for them. So then you can provide some really cool incentives or you can provide just a raise in base salary or whatever, right? But you can't provide that when they're not hitting what makes all that possible. 

All this to say on this episode, whether you work with us directly and we help you navigate this, or whether you don't work with us but you learn from this podcast and you learn that the arrangement that you have with your producers isn't working, or anything in the firm that you learn from this podcast and you go implement it into your firm, or you want to implement in your firm, I just want to set the expectation that there can be fallout from that.

There can be this ripple effect that happens when you get clear with people about what the expectation is moving forward. And if they don't like it, they may walk. And I'm telling you, it's one of the best things that could ever happen to you because as long as you have that arrangement in your firm, you are handicapped. You cannot provide what you want to provide for you and your family, for to the team, in terms of continued growth and development for systems and technology that you want to put in place. Like everything is strangled, and it's like the firm is being suffocated because there's just not enough. 

So your fear about all of, like, losing the people because they don't want to do your new expectations, I understand it, and it's par for the course. And weeding that, like letting them, those people self-select out so that you can get in the right fits and arrangements that make more sense for your business, will change your entire life. And I really mean that. It sounds dramatic, but it's not.

Because things get easier at work, like expectations are set, people are hitting whatever makes sense in their role and for their thing. They're meeting those expectations. It means enough money is coming through the door. When enough money comes through the door, it takes stress off of you as the owner. It takes stress off of the business. It allows you to invest in ways that you want to invest. It allows you to take home in a way that you have not been able to previously. Everything gets better. It will change your life.

And you won't feel so pressed down by the business or held down by the business. You'll feel like a rejuvenation or a renewed sense of energy around running your firm. You'll have hope for the first time in a long time.

So I'm not pretending that any of this is a cakewalk. If you need a… first of all, those uncomfortable conversations, not a cakewalk. And you can do hard things, right? You can prepare for those conversations. You can do the best that you can with those conversations.

And it still may not work out. And so that's uncomfortable. If it doesn't work out, then that's uncomfortable because then it's like we were talking about last week, people are going to leave the firm. And when they leave the firm, it doesn't mean it's easy to move forward. But that's your opportunity, man.

And if you can look at that as an opportunity and put one foot in front of the other, and then take the advice that I gave last week on this episode about how to check yourself mentally as you move forward with all of that and make sure you have the right mindset, you are just on the precipice of opportunity that will shift everything for your firm and everything for you as the owner.

And when those two things happen, the ripple effect, you know, if the business wins, a lot of folks win. Your team, your clients, your team's families, you, your family, there's more, right? It's like vendors that you can afford to pay now for things you need to done, but you haven't been able to have the money, so you couldn't do it. So it's like the ripple effect keeps going and going and going when the business is healthy.

None of that gets to happen if it's not. How you show up at home, your mood, just it all shifts and how your mood at work shifts. When things are being taken care of, and you don't feel like you are being held down by this business and that you can't get ahead with this business, everything changes.

So allow people to weed themselves out. When you decide that you need to make a call that's better for the business, do not sit on it. Do not say, "Well, next time someone comes in the firm, then I'll reset expectations with them." No. That means you're just asking to continue to live in an extremely unideal scenario until then. It's like, that's such a passive approach. You are the business owner.

Act like a business owner. Act like a leader of this business and do the right things for the business. Because if the business isn't doing well, no one else does well. So don't be passive about this. There's a way to not come in like a bull in the China shop when you're talking to the team members that you need to reset expectations with, but do not wait. Do not wait. Do not wait for the next person. Like, once this person leaves, then the next one comes in, I'll do it. No, you're just going to do it now. Have the conversation, have a difficult conversation. And see where it goes.

If it doesn't go well, you know what you need to do, right? If they're not weeding themselves out, you're going to have to weed them out. So you're going to have to take steps to do that. But the whole idea is you get what the business needs in place. And if there are certain arrangements that need to be weeded out and the people are not accepting the arrangement, the expectations that you are laying down, if they're not accepting those, if they're rejecting those and there's a bunch of resistance to those, no, that weed needs to be pulled. And maybe they get themselves out of there, but one way or the other, you're going to have to make sure that's taken care of. 

All right, everybody. Hopefully this helps. I know many of you, you do work to make changes. You do work to get things healthier. I know you do listen to this podcast and other podcasts, and you hear things that you wish were different in your firm. And the only difference between you wishing it was and making it a reality is the action that you take.

So I want to encourage you to take the action. I'm just being honest with you about the truth is it may weed people out and that's the best thing that could happen. May not be easy, but it is the best thing that could happen for you and for that firm.

All right, everybody. Have a wonderful week. I'll see you here next Tuesday.

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