Whenever you start a new initiative in your business, it's always best to do it in line with your strategic plan and your business goals. If your strategic plan is about growth, bettering client service and increasing profitability then you really ought to include outsourcing as part of your 2018 plans.

Outsourcing is something that once implemented and embedded into your daily routine, you won't believe you ever lived without it. But we often recommend that you ease your way into outsourcing, and take your team on the journey with you in a measured and step-by-step way.

One way that you can do this is by dipping your toes into the outsourcing world first. A good place to start is to assess your team members daily tasks and duties and work out which ones are time consuming, routine (read boring) and take them away from focusing on your clients.

In our experience, the following tasks are commonly outsourced and can be initiated in a relatively easy way:

Linking emails to your Practice Management System: this can be time consuming for your staff but it's a necessary evil. Let us take this job off the hands of your team members to free them up for tasks that provide greater value to your business.PDF conversion and copy typing: we recently visited a firm where one of the Partners had just spent hours trying to convert a PDF so that he could get on with the legal job. What a waste of his time and the firms resources! Let us do this tasks for you so that you can focus on your billable work.Processing accounts payable and transactions: did you know that we have professionals in both India and Melbourne that can help you with these tasks?Updating / formatting precedents: our team are experts at formatting documents in line with your requirements and can do these jobs within a very quick timeline.Dictating and transcribing file notes: this is a great task to outsource, particularly for those of you that have gone paperless.

So now is your time to act. Pick up the phone and give us a call - we'll help you get initiated into the world of outsourcing!

Brendan Hunt

General Manager

Strategic Business Alliance

LinkedIn|Email |Phone 03 9863 8122

Many of our clients love using us to help them fulfill key marketing and business development tasks such as writing articles or newsletter content on the latest case law or legislative developments.

Whilst we work flexibly with the internal processes of each business, we wanted to share our top tips on how to instruct us to write articles to help you complete this task – let us help you tick it off your to-do list!Step 1 - Identify the content

First off, identify the case, legislative development or the subject matter of your proposed article. Send us either a copy of the case, new law or a link to an alert explaining the topic.

Step 2 - Consider the call to action

Secondly, you need to consider what the purpose of the article is. For example, is it to notify your current clients about changes in the law and get them to contact you to discuss how the changes impact them or their business? Or is it to flag an upcoming change in legislation and just demonstrate your expertise in the sector? Or maybe it’s to highlight the need for them to attend an upcoming webinar or event. Either way, communicate this to us so that we can best tailor the article based on the desired output.Step 3 - Set the framework

Thirdly, it’s a great added bonus (but not a necessity) if you have a pre-existing format that you like using for articles. Perhaps you’ve published something before and want to replicate that article, or maybe you’ve seen something you like on the web. Whatever guidance you can give us about the format you’d like the article to be shaped around then send that through.

Step 4 - Specify the rules

Now it’s time to tell us the parameters. Perhaps your marketing guru has told you that articles need to be 600-1000 words max, or maybe you want us to draft content for your LinkedIn or Twitter account. Whatever the medium, it’s best to keep things short and snappy (unless you’re writing an ebook or white paper) so don’t be afraid to tell us the word limit or maximum pages.

Step 5 - Timeframe

Be as specific as possible with the deadline. If you want something to go out on a certain date, and we are new work buddies, then set a deadline for us to provide you with a first draft and then if it’s necessary, we will have time to review your feedback or suggested changes so that we can meet your publishing date. We aim to please but by planning ahead we can make sure that we delight!

Step 6 - Feedback

We want to work with you on an ongoing basis and the more work we do together, the better and quicker we’ll get at delivering great work for you. Make sure you provide us with open, no holds barred feedback – we love learning and developing with each task. To help you and your employees with this process we have created a checklist with all the information you need to make sure you're on the right track. You can download it by clicking .

You can provide your feedback direct to the team member that you’ve been working with or you can always call or email Partha on:

T: 61 03 9863 8122

M: 0433 311 149 E: partha.nag@sballiance.net.au

We hope you are reading this refreshed and excited about the year ahead – we sure are! To kick things off, we published our first blog for the year on the topic of leadership and how you can create rewarding roles for your team members by effectively using outsourcing to enrich their lives (and yours!). Read more on that in our article published in Lawyers Weekly here.

If 2018 is the year that you are going to carefully review your productivity, and that of your staff, you’re going to love our How To Series.

As part of our commitment to you, our clients and key supporters, we want to break down the barriers to ensure that you utilise our services in the best way for you, your team and your business.

Our How To Series is our way to:

Demonstrate how you can use us to better to increase your productivity, enrich the lives of your staff and make sure you’re home for dinner with your familyHelp you better understand how you can use our services and different team members to get your article writing, legal research, conveyancing, accounting and administration needs completedShow you how others use us, by sharing case studies from the legal and professional services industry and interviewing the movers and shakers in the sector to help you get inspired about outsourcing for your business

So make sure you subscribe to our blog and newsletter and watch out for more from us on LinkedIn , Facebook andTwitter.

All the best for a successful 2018.

Partha NagExecutive DirectorStrategic Business Alliance Pty LtdLinkedIn

Let us work for you so you can enjoy your Christmas break!

Picture this: you're down at the beach house, novel in hand and the ice cubes in your drink are clinking away as they melt in the warm sun. Meanwhile, that annoying task that you kept putting off during the year is now getting done for you by our team at an incredibly cost-effective price. You're relaxed and content knowing that you've effectively delegated a task that should have never been on your to-do list in the first place. Heaven!

Now think: why couldn't this be you? What's holding you back?

At Strategic Business Alliance we regularly help our clients carry out a range of tasks during the quieter holiday months.

Some of the ways in which we can help you are:

Database cleansingPrecedent formatting of raw documentsData compilation (building a database)Holiday standby cover for WP and Conveyancing (carried out by the Melbourne-based team)Cleaning up your client lists by cross-checking contact details and ensuring you have the most up to date data for key contacts Article writing to ensure that you're ready to hit the ground running with your marketing plan in 2018Seminar development so that you've got your case studies and power point presentations ready to go in line with your speaking gigs in January and February 2018

Talk to us about how we can help you relax over the Christmas break. Let's get the task list complete and your planning for 2018 underway.

Outsourcing is a way in which businesses can get work done without having to have someone internally perform the work.

The benefits of outsourcing, and using SBA, include:

enhanced productivity and efficiencies to suit an increase in volumeimproved staff retention and job satisfactionclient satisfaction and better serviceability

“Since using SBA, we have been able to increase our workflow two-fold whilst not putting any extra pressure on our staff – in fact, our staff are much happier now as they have greater support in carrying out their roles.” Trevor, Law Firm*

*Names changed for confidentiality reasons

Enhanced productivity The primary advantage of outsourcing with us is enhanced productivity and efficiencies. We can achieve this by helping you change how the work is processed and performed, to increase the volume of work that can be carried out on a daily basis.

Case study: a recent example of how one of our clients has been able to improve productivity

Sarah from Best Law* had a noticeable increase in the demand for conveyancing work. She was struggling to get her staff to keep up with demand and one of her conveyancing clerks, Lucy*, started hinting that she’d need to be paid overtime to keep up with the volume of work. Sarah contacted SBA and commenced outsourcing some of her conveyancing work to SBAs onshore team in Melbourne. Lucy now controls the matter management and client-facing side of the work and directs nearly all of the drafting to SBAs onshore conveyancing team. By using this service, Sarah has been able to meet an increase in work in this area, limit her overheads (as she hasn’t had to pay Lucy overtime or put on extra staff herself) and improve client service – as Lucy is now more available to focus on answering client calls and queries. This change in workflow has led to an increase in referrals (clients are speaking so highly of Lucy’s attention and care) and the ability for Best Law to meet this demand. Sarah is now looking at other ways to utilise outsourcing for her business.

*Names changed for confidentiality reasons

Improved staff retention and job satisfaction Whilst staff may initially fear the introduction of outsourcing, and a change in workflow, people quickly realise that the SBA outsourcing team is there to help – not hinder. This is because outsourcing is a way to enrich the lives of staff, and increase their job satisfaction.

By identifying the process-based (often boring) work, and assessing work that can be performed by someone remotely, your staff can be freed up to focus on more of the interesting or complex work that needs to be done in-person or via a tailored approach.

We work with our clients and help facilitate workshops with team members to help identify the tasks that can be outsourced to free them up to focus on the more important work at hand. In this way, we empower your team and make them feel a part of this new and exciting process. With the right buy-in, you’ll be surprised at how easy the outsourcing transition can be.

“When my boss told me that we were going to be using SBA I was really nervous about what this would mean for my job. I was even quite defensive in the initial workshop with SBA. But now that the system has been put in place, I’m the biggest promoter of the service! I actually use the SBA team more than anyone else, because it frees me up to focus on managing the files and dealing with staff and client queries, which is the part of my role that I really enjoy.” Karen, Personal Assistant.

Client satisfaction and better serviceability When you outsource work, you enable your staff the time and freedom to truly focus on looking after your clients.

During our workshops, we help your staff to identify the tasks and duties that are “back-end” and those that are “client-facing”. In this way, we help your team work out what they can outsource versus what you want them to focus on to ensure that clients are getting the best out of your people.

If your staff are freed up to spend time talking to your clients, promptly answering their queries (whether online or over the phone), making them feel looked after and a priority, this will improve your client satisfaction and enable better serviceability.

“While delivering an outstanding experience may vary in complexity between practice areas, and types of law, customer and client experience remains critical to improving brand reputation, market share and increasing profitability. With greater competition in the marketplace, your client-facing performance has to be of the highest quality to distinguish you from the rest.” Carl White, CXINLAW

Let’s get started!

If you’d like to further understand how outsourcing can work for your business, contact us today to explore the options.

The discussion around outsourcing beyond a work task and for business growth is now really building momentum in the business world. However, historically, outsourcing was only referred to by business leaders as a means to getting more work done in a cost effective way.

You hear: Don’t waste your cost of service on your bookkeeping; outsource it. Don’t waste your time on designing a Facebook banner; outsource it. Don’t waste your brainpower on writing an article… well you get the idea.

But as a business delivering high quality Business Process Outsourcing, we find what clients – and the general marketplace – don’t understand is that business outsourcing can (and should) be used as a strategic business growth tool.

Be it good or bad, we know there are many platforms that facilitate a factory-like approach to outsourcing. Simply post the job you can’t do and/or don’t have time to do, and in comes a flurry of candidates keen to do the task for you.

Easy. Right?

Rarely. Because using a freelancer or resource on an adhoc basis can actually add to the time impost involved in delegating, training and upskilling an individual to suit the task at hand.

Finding a freelancer who wants to commit to being your go-to, reliable worker is easier said than done.

We make no apologies to being nothing like these platforms. Whilst we understand the above platforms are suitable for some businesses, we also know that our clients benefit from our very different approach.

Instead of being your irregular provider, we become strategic business partners with our clients so that you and your team benefits fro, our services on a more ongoing basis.

We’re all for using outsourcing as a means to freeing up workload, in fact, it is one of our value propositions. But we can deliver so much more value if you view outsourcing as an opportunity to align with a team professionals who can uncover many ways to grow your business.

We see ourselves as business partners with our clients, regularly doing the work requested but also taking note of how you are processing certain work tasks and providing ongoing advice about how you can improve efficiencies and workflow to increase your output.

So how can you use business outsourcing beyond your task (to do) list and instead as a tool for business growth?

Here are some ideas to consider to increase your businesses growth:

Gain a fresh, professional perspective by having us review your current workflows and processes for increased efficiency;Allow us to document your work practices for quality control and increased security – vital for any business succession plan;Let us tell you about the tools that you can implement to better utilise technology in your business; andMeet with our IT professionals who can help your team better perform their duties and assist with any computer and online issues.

This is just the tip of the iceberg...

It takes a personal approach; meeting with each client to understand their needs and objectives, staff processes and culture, and values. Only then can we develop a plan to best partner with you and help you grow.

If you would like to learn more about how Strategic Business Alliance can partner with your business or professional practice for growth, please contact us today.

Sometimes the decision to outsource your work is fairly easy for a small to medium-sized business owner. It’s easy to work out if you and/or your staff are working too hard and long on work that others less skilled should do. It’s also fairly easy to calculate that it is less expensive to outsource laborious admin, IT, data management and processing tasks compared to the hourly rate of you and your staff or hiring a new employee.

What is less easy is to work out is who on earth you can trust with your business process outsourcing requirements.

We’ve all heard of nightmare experiences. A business owner finally lets go of some work and the result is terrible. Ask someone of their experience of global freelancer platforms and it’s a hit or miss approach with no real way to hedge your bets on quality output.

And when you get a bad result, not only have you lost the ROI argument to stakeholders, but it’s extra time that you can little afford to re-do the work yourself.

But, if done well and to your business’ standard, outsourcing can be your ticket to taking the next level in business growth. And you definitely want that.

So how can you hedge your bets when it comes to business process outsourcing? Here are six tips to increase your success in choosing the right person for your business’ work requirements.

1. Take control with risk management

I’d love to tell you that you can trust everyone, but that’s not realistic. So with this in mind, you need to manage your business’ risk from you end. (At least at the start of your outsourcing journey.) When deciding on your first outsourcing work project, choose something small that isn’t dependent on it being perfect within a certain deadline. Also, choose work that is for in-house processes – in the early stages, don’t risk your business’ reputation on a freelancer doing work for one of your clients.

2. Interview

Just like any HR situation, interview prospects and take your time to find the right person/s to do your work. Also consider cultural fit for your organisation as you will be spending time communicating with them detailing your work needs – it’s easier if you get along. Don’t rush into choosing a candidate either; there are many wanting to work with you, so take your time to find the best freelancer for your project. Remember also, you can interview via written messages or Skype, so don’t let the global economy stop this process.

3. Look at testimonials It’s natural to want to help someone out and give them their first job, but be mindful of the risk. Best to stick with people who have a long list of testimonials and can showcase their previous work. This will minimise the risk of receiving work that doesn’t meet your business’ standards and is unusable.

4. Set clear objectives Don’t forget you are “employing” someone, even if it’s for a one hour project. Therefore, it is important to set clear objectives for your hired freelancer. This limits the possibility of things going wrong and having to pay for unfinished work. If you can, set milestone achievements to pay against so you can test their work at a very early stage; if work is not to standard, you have a better chance to end the contract early.

5. Outline the long-term possibilities Your outsourcing goal should be to have a long-term relationship with person/s you trust to do consistent, quality work at a moment’s notice. The longer the relationship, the more likely this will occur. Outline in your first interview that you would like to work with someone long-term for your outsourcing requirements and ask if they would be interested. Some only want one-off projects or certain types of work, so best to make an informed decision at the hiring stage.

6. Review their work honestly Help other SME owners with their outsourcing decision-making and review the work you received from your freelancer honestly. This step also helps the freelancer, if you deliver constructive feedback. And, you know what it’s like – receive positive feedback and you’re usually more excited to keep working with that person and continue to do good work (reward and recognition).

These tips are actually quite common sense, I know. But you’ll be amazed how people don’t take the time to respect the entire outsourcing decision-making process. In the end, it is the output of the person you hire that will make your decision to outsource the right one.

We at SBA believe we manage all the above for business owners to ensure your outsourcing requirements are met every time. Our quality control process ensures we match staff who do great work and have all the skillsets required for your business’ needs. The bonus is you get to meet their bosses before you hire – ultimately it is our business’ reputation on the line with every contract. Our people aren’t freelancers; they are our staff who can become a part your team.

But, of course, this is easy for me to say. And regardless of my (biased) opinion, you should still do your due diligence and manage your risk for Business Process Outsourcing as above, even with us!

As a business owner, understanding your cost of service is pivotal to your business’ success.

You need to know what you’re worth and also, the cost of delivering your services.

To do this, you need to have an understanding of your workflows and business processes. But when you're busy working in the business, it's easy to forget about how to best work on your business.

And when you're knee-deep in administrative and process-driven tasks, you can be distracted from your most important tasks – client acquisition and fee generation.

We know one of the key challenges for any small and medium sized business owner is getting bogged down in administration and compliance related tasks. This is because most SMEs are comprised of small teams and everyone is stretched too thin.

Between administration, accounting, BAS, compliance, IT, HR and all those miscellaneous business tasks, there is very little time left for you to focus on taking opportunities that will leverage your expertise.

Business Process Outsourcing (BPO) can mitigate risks and free-up critical time for key persons to focus on client work and business growth.

Imagine, the freedom and job enrichment you could gain if you could just outsource all of those process driven (often boring) tasks.

How can you get started?

Our favourite saying is "hasten slowly".

Start with outsourcing one simple task or project and grow your outsourcing usage as trust is built. You may even discover, over time, your outsourcing team becomes a trusted business partner.

So, it’s time to assess your situation.

Contact us today and we can book in a meeting to assess your workflow and develop options that suit your business.

How Business Process Outsourcing Grows your Business

When you talk with small business owners, regardless of industry sector, there is one common issue they believe sabotages their business’ success:

They need more hours in the day to get all their work done.

As a small business owner, you are the centre of gravity – everything revolves around you.

You are CEO, HR, Accounts, Sales and everything else rolled-into-one.

And while, depending on the size of your business, you may have a small team of committed team members who go above-and-beyond to keep the wheels of your business running, even with this support, being the centre of every business decision often means working long hours, seven days a week.

And when you have competing priorities, which you do because you are the centre of gravity, where do you start in prioritising your tasks that you don’t have enough time for?

Talk to any time management expert and the best way to start organising your work day is to outline one or two tasks critical to your business’ success.

Do you know what these are?

Safe to say, cash – or rather cash inflow – would be one of the most critical factors for any business. But, cash inflow can only happen if there is enough time to do all the billing and client invoices on time.

Herein lays the start of your conflicting work priorities, and just when you think you have a handle on your critical task list.

For many businesses, cash inflow is determined by acquisition of new clients and getting more work from existing clients.

But this can only happen if you have time to ‘go out’ (whether face-face or online) and do business development and marketing to sell your business’ products and services to the marketplace.

Given all the tasks to achieve just one of your daily objectives – cash inflow – how can you get everything else done?

It’s understandable to be well and truly overwhelmed.

But there is a way to supercharge your small business’ profitability and increase the value of your business, and the answer may shock you.

Part of the solution, and I emphasise it is only one part, is to use Business Process Outsourcing to complement you and/or your in-house team to achieve clear objectives in your work day.

Business Process Outsourcing, when correctly used and properly deployed, enables your small business to grow on a more stable basis and allow you to retain and grow your in-house team.

How is that possible? You use business process outsourcing to give you back the hours you need to work on your complex client work and your bigger picture business strategy, whilst an outsource team is working on the simpler business tasks.

A quality ‘away’ (outsource) team comprises of professionals who are able to assist with a variety of tasks ranging from basic administration to processing accounts, through to preparing monthly management reports and marketing plans, implementing time saving IT applications, and much more.

Your ‘away’ team will assist with those basic, but important, overflow tasks that never get done on time, if at all.

By the way, don’t be surprised if this is already the secret weapon to your business peers and competitors who seemingly have their business work all “under control”.

As a small business owner, ask yourself: If time is money and time is in short supply given all you do, what value can an ‘away team’ add to your business?

Consider, also, if you have no obligation to pay a fixed fee for these professionals. You get to use your ‘away’ outsource team as your ‘home’ team as and when you need them. They are your cavalry on those days when all clients seemingly need work done ASAP and at the same time.

Whilst the cost advantage of off-shoring your work compared to on-shoring is obvious, what actually adds value to your small business is having time freed for you to do everything that increases cash inflow and the number of clients.

Imagine the freedom to have the time to do quality work for your clients (to actually use the skills they employed you for) and work on your business.

Imagine not having to worry about those pesky, simple tasks that keep transferring to tomorrow’s to-do list due to lack of time.

Imagine how many hours that would add to your day to grow your business.

For accounting practices with primary revenue streams derived from tax return preparation and compliance and advisory services, SBA’s Book Keeping Outsourcing solution for professional practices present significant opportunities to increase revenue streams through the provision of a standardised white label book keeping service.

Benefits from Partnering with SBA for White Label Book Keeping Services

Add incremental revenue streams by offering book keeping services to tax return and advisory clients.Benefit from a standardised resourcing model for book keeping services by transferring the employment risk to SBA and benefiting from SBA’s dedicated team.Provide a competitive value proposition to clients by leveraging SBA’s competitive pricing for white label book keeping services for accounting firms.

White Label Book Keeping Process Flow

Team SBA becomes your firm’s ‘away team’ and processes transactions in a variety of small business softwares.Team SBA logs in in remotely to process transactions, or paperwork from clients are uploaded to a common storage repository from where transactions are processed.Team SBA can do end to end book keeping ranging from invoice processing through to management accounts preparation.

Competitive Advantage

Open new revenue streams and increment existing revenue streams by offering a competitive book keeping and management accounts preparation service to clients.Benefit from access to an on demand resource pool of accounting professionals available to deploy with minimum notice.Improve turnaround on book keeping and accounts preparation assignments by leveraging time difference and having a dedicated team of professionals to complement the in-house team.Benefit from competitive pricing commencing from $15/hr + GST for deployment of accounting professionals under a no minimum volume deployment.

Summary

Benefit from having a dedicated ‘away team’ of accounting professionals.Offer a competitively priced book keeping service to tax return clients.

Contact SBA today to see how SBA’s book keeping outsourcing package can benefit your accounting firm.

In this blog, Graham Le Roux, owner of Constantia Management Group examines how professional practices can deploy effective client relationship management strategies during downturns.

Loving your Clients or “Don’t bite the hand that feeds you”

When times are tough the tough get going! True but what does it mean to us punters?

Firstly we notice that our competitors become aggressive chasing every sniff of a job and pushing the price down to try to win business. This is understandable and our inclination is to do the same. Perhaps a different path would be to focus on the fundamentals and to try to focus on meeting our client’s needs even more than we did in the times of plenty! When preparing myself for this story I found myself automatically chasing down operational issues, then as I did more research I realised there was an alternative – the client needs focus. As with my last blog on “how to eat an elephant” we need to consider two approaches to having a successful client relationship in tough times.

Operational Issues;

Which clients give you more ‘bang’ for the buck.Which clients are more valuable and more profitable.Which client retention strategies are you going to adopt.Which markets will be sustainable through tough times.Which products and services will be sustainable through the tough times.Clean out all archiving, especially Safe Custody packets – these can be a tremendous source of instructions when they get older and in need of updating.

Clearly these approaches are aimed at optimising effort and rationalising resources. The danger here is that client and market segmentation activities often have unintended consequences; you could “deselect” a client/market which becomes a market leader (a great example of this is the old digital watch story in which traditional watchmakers rejected the move to digital watches which allowed new producers to enter the time price market and secure massive market share) .

Clients need focus

Develop a deep understanding of what your clients need in this environment.Eliminate everything they don’t need – your complaints register and any stories of dissatisfaction are pure gold.Turn client needs into service/product specifications.Segment your market – some customers may pay more.Try to make everything about your firm focus on delivering VALUE to the client.Measure client perception of satisfaction, value and loyalty.Work to get closer to your clients expectations by constantly modifying your processes

The difference between this approach and the Operational approach is that this approach focusses on the client whilst the Operational approach focusses on your processes.

Steps to improving client focus

Find out where you stand on client focus with:

Your EmployeesYour ClientsYour Equity HoldersYour Suppliers

Identify strategies and implement actions to close gaps in client focus in each of the above four groups.Align the strategies for each of the above four groups.Hunt in a pack by determining and communicating your firm’s new client focus.

Client focus Health Check

How would your employees rate your firm on these?

I understand what my clients value.I understand what the firm‘s clients value.We actively try to find out what our clients dislike about our products and services.We use client input in product and service design.We use client feedback/complaints to improve our service.Our products and services are of value to our clients.Client feedback is a gift that we use to improve our products and services.Everything about our firm is focussed on providing what our clients value.

How would your clients rate your firm on these?

This firm focusses on what we value.This firm provides products and services that we value.The employees of this firm are exceptional in providing products and services we value.We trust this firm and its employees.Employees of this firm go out of their way to please.We feel that this firm uses our input to improve products and services.This firm actively seeks what we don’t like about its products and services.This firm uses our feedback about what we don’t like to improve its products and services.This firm is always trying to find new ways to delight me.This firm creates value for me.

How would your equity holders rate your company on these?

This firm is organised to provide what its customers value.This firm is steadily working to increase the value it provides to clients.The firm invests in providing value to its clients.

How would your suppliers rate your firm on these?

This firm is our client. We work to provide products and services that are of value to it.The products and services we provide are of value to this firm.We are working with this firm to ensure that we understand more of their business so that we can provide what they require.We are working with this firm to ensure that our products and services continue to increase value to this firm.We are working with this firm to ensure that our products and services create less and less costs to this firm.

Core message

Use two dimensions in your client management strategies.

Manifesto

Focus on improving and aligning client focus – constantly and forever.

Quick steps

Quick health check.Consider segmenting products and services.Provide value.Seek knowledge about client needs as well as client dislikes.Align all employees and owners with the extreme client focus.

Strategies

Consider operational and client focussed strategies.Constantly review the outcomes of your new actions.Be flexible and consider all options.

About The Blogger

Graham Le Roux is the owner of Constantia Management Group and has over 15 years of experience in law firm management. He was an Australian Awards evaluator for 10 years and has helped numerous firms achieve ISO certification. Graham is passionate about simplifying the overwhelming data bombarding managers of law firms and identifying key actions to improve Profitability, Cash Flow and Value.

Contact him on 0419235060 or at grahamleroux@constantiamanagementgroup.com

In this blog, Graham Le Roux, owner of Constantia Management Group examines how professional practices can effectively review their costs and expenses during downturns.

Reviewing costs and expenses or “There’s a hole in my bucket!”

When there is a downturn in the economy it is a good time to examine and review all expenses. There are risks and costs associated with a program of expense/costs review BUT they are far less than the long range risks and costs of comfortable inaction!

The problem in the downturn environment is that revenue (income) tends to contract whiles fixed costs tend to remain static. If variable costs contract in concert with contracting revenue then you are relatively OK until you reach your break even point after which it will be costing you money to make a sale! So as they say in modern parlance “What’s to do?” In my experience suitable actions arise in two dimensions:

Dimension 1 – Variable Expenses

These are expenses directly associated with production. Good examples include the cost of the container into which you put your product or the paper on which you print your report if your deliverable is a professional service. Therefore prepare a variable cost review checklist like this:

Variable Cost Review Checklist (example for illustrative purposes only and total shown is not sum total of figures shown)

Dimension 2 – Fixed expenses;

Fixed expenses are harder to review and they do not directly vary with production.

Fixed Cost Review Checklist (example for illustrative purposes only and total shown is not sum total of figures shown)

Beware of unintended consequences

By offering redundancy packages to all staff you might end up losing key staff as well as corporate knowledge held by individuals and not the organisation (only they know how to do certain stuff).

By removing resources you are changing your effectiveness in terms of materials and assets. If you cut too deep you might not be able to respond quickly (nor easily!) when the economy recovers.

Steps to improving cash flow

Review all Variable ExpensesReview all Fixed ExpensesIdentify possible cost savings and construct review actions.Consider all consequencesImplement agreed savings/cost reductionsReview the results of the cost reduction exercise.

Core message

Reducing expenses is not an easy activity and should be undertaken with sensitivity and extreme caution.

Manifesto

Examine all expenses, do not leave out any sacred cows.

Quick steps

Check if there are any redundant assets which could be sold.Identify those expenses which account for 80% of your total expenses – review these first.Some staff may be approaching retirement age – consider offering these staff an early retirement incentive.Cease employing casuals and part timers.

Strategies

Ensure you always have an up to date Purchasing PolicyOutsource some of your back office activities.

About The Blogger

Graham Le Roux is the owner of Constantia Management Group and has over 15 years of experience in law firm management. He was an Australian Awards evaluator for 10 years and has helped numerous firms achieve ISO certification. Graham is passionate about simplifying the overwhelming data bombarding managers of law firms and identifying key actions to improve Profitability, Cash Flow and Value.

Contact him on 0419235060 or at grahamleroux@constantiamanagementgroup.com

In this blog, Graham Le Roux, owner of Constantia Management Group examines how professional practices can improve their cash flow.

In my view improving cash flow is like eating an elephant – do it a little bit at a time! Start with the easy bits! Before starting the Cash Flow Improvement project be sure to clarify your current status e.g. Debtor Days, Debtor Value, Debtor Aging, WIP Days, WIP Value and WIP Age, and what you would like these to be at the end of the project. Equally important is to record any process improvements and incorporate these in the system to improve the system forever.

In my experience we need to consider both internal and external elements impacting on cash flow

Internal Factors

The extent of your billing and whether or not this can be improved

Whether or not your selling price includes an appropriate margin

How intense or accurate your client engagement process is

How strong are your communication processes with your client

Whether or not the product or service has been appropriately delivered to the client

The strength of your relationship with the client – does the client respect you as much as you respect them

The effectiveness of your stock/ lock up management

Whether or not you are holding funds in trust for your client

The extent to which you are using discounting

External Factors

The economic environment in which you are operating

The ability of your clients to pay

The willingness of your client to pay

Whether or not your client has received an invoice or a statement

Whether or not your client respects you as much as you respect them

Steps to improving cash flow

Review your Credit Control policy for appropriateness, completeness and accuracyCategorise debtors – focus on collecting the largest and oldest outstanding first,by size and by ageContact all large old debtors (using the script suggested below)Categorise all WIP – focus on billing the largest oldest items first,by size and by ageReview all large WIP (including disbursements) balances andBill all balances which meet billing criteria per the Credit Policy and Engagement Letters

Suggested script for Debtor follow up

A) “Good morning my name is Donald Collector from XYZ Legal Services I am calling you about the work we recently undertook on your behalf.”

B) “Can you tell me if the work we did was satisfactory in keeping with your instructions?”

C) “Have you received our invoice?”If the client answers YES to the above a), b) or c) then say:

“Is there anything I can do to expedite payment?” “Give assurances that you will do what has been agreed.”“Can you confirm when the invoice will be paid?”

If the client answers NO to the above a), b) or c) then say:

“Is there anything you would like me to do to rectify the issue?”“Give assurances that you will do what has been agreed.” “Can you confirm when the invoice will be paid?”

The thrust of the above is to establish that the work was done, that the bills have been received and that therefore the bill is payable. You will notice that the script does not indicate that you should tell the client that the bill is unpaid.

Core message

Often cash flow can be improved by closer attention to managing working capital.

Manifesto

Examine all sources of cash, starting with the assets which are easiest to liquidate and rescheduling long term debt.

Quick steps

Check if there are monies in Trust which a client could authorise you to pay the debtMeet largest debtors face to face and use the above scriptsCall the rest of the larger debtors using the above scriptsA partner/director calling a debtor will have more success than an employee calling.Bill all billable WIP

Strategies

In the longer term you could consider some alternative options if your Partners or managers aren’t able to regularly carry out debt collection activities:

Consider “factoring your debts”Outsource your debt collection activities

About The Blogger

Graham Le Roux is the owner of Constantia Management Group and has over 15 years of experience in law firm management. He was an Australian Awards evaluator for 10 years and has helped numerous firms achieve ISO certification. Graham is passionate about simplifying the overwhelming data bombarding managers of law firms and identifying key actions to improve Profitability, Cash Flow and Value.

Contact him on 0419235060 or at grahamleroux@constantiamanagementgroup.com

In this blog, Graham Le Roux, Principal of Constantia Management Group (www.constantiamanagementgroup.com) outlines strategies for law firms in lean times. Graham outlines 7 action areas and a list of top 10 action items to implement the outlined strategies.

Strategies in lean times

The question facing law firm owners, managers and administrators is ‘What can be done?” We have compiled a list of seven issues facing firms and we pose some strategies:

Cash

Review working capital – debtors, WIP and unbilled disbursements.

Liquidate your debt.

Renegotiate the terms of loans.

Insure debt.

Refine Credit Control policies, procedures and practices.

Review all Trust Accounts.

Clients

Pareto analysis of effort and return for each client.Review value and profitability of clients. Consider client retention strategies.Review sustainability of markets currently serviced.Review sustainability of products delivered.Review currency of all documents held in safe custody for clients.

Costs/expenses

Review all costs and contracts.Re-negotiate terms and conditions with suppliers.Sub lease any Assets which cannot be fully utilised.Share resources with similar firms/businesses.Form alliances with other law firms and businesses.Consider outsourcing support services.Establish and review Practice Group/Area of law Profitability.

People

Review the need for all staff.Offer redundancy to excess staff.Identify those staff who are “rusted on” and no longer performing.Promote key personnel – encourage non productive staff to leave.Sub contract staff in or out.Second underutilised staff to other businesses.Review pay structures.Review work allocation.Implement succession and exit strategies.

Policies and procedures

Review all policies and procedures from the ground up.Review all policies which inhibit optimum performance.Review all support services and the need to retain them.Review all management services and speed up management information channels.

Leadership

Review Vision and Mission.Can a layer of leadership be eliminated?Review all legacies, white elephants and royal game.Review Structure of the practice – number of partners, number of solicitors and number of staff.

Cultural issues

Take extraordinary steps to protect your values and culture.

Is now the time to acquire new areas of law.

Invest in Research and development.

Consider re- tooling and reinventing what type of law firm you will be.

Top 10 actions

Act now on cash flow maximisation, WIP, Debtors, Disbursements and Trust accounts.Action a client review – Pareto analysis and profitability.Act now on Costs/expenses and supplier contracts.Review all staff, pay structures and work allocation.Review Mission, Vision and Values.Review service offerings and practice groups.Review policies and procedures.Review management and processes.Defend culture and values.Contact us for assistance.