Traffic lights are simple to understand.
Red means stop.
Amber means you can’t go yet – you have to wait for something else to happen.
Green means go – full steam ahead.
How does this relate to increasing the profitability of a legal practice?
Like traffic lights with their 3 different colours which work together, a profitable legal practice has 3 different elements that also work together.
- Attract: high quality enquiries from the right kinds of clients who will pay the fees you want to charge)
- Convert: enquiries into paying clients with the minimum of time and effort)
- Maximise: the profits from clients once you get them, so you can make more money without needing to chase new clients all the time)
But unlike traffic lights, when it comes to your legal practice we don’t want an ever changing combination of red (stop) amber (can’t go yet) and green (full steam ahead). You want each area to be green and working as efficiently and productively as it can.
When any area has a red or even an amber light on it – meaning it’s not working at all or not working as well as it could – then it’s like having your foot on the brake as you’re trying to accelerate forwards. It makes it hard work. And slow progress.
But when all three areas in your practice are on a green light then not only is there nothing to slow you down, but all three can work together to increase the results you get.
- When you attract more enquiries, there are more enquiries to convert into clients and more clients to maximise profits from.
- When you improve your conversion rate, you get more clients from the enquiries you’re getting; so you get more clients without spending more time or money on marketing or business development, and you have more clients to maximise profits from.
- When you make the most of the clients you’ve got, you can increase your profits without needing to spend more time and money attracting and converting more clients.
Because of the cumulative effect of these 3 elements working together, just a 10% improvement in each area will give you more than a 30% growth in profitability.
Ready for the next step?
Follow my Traffic Light Accelerator Tool right now to find out which area of your practice needs work and what you need to do next:
- Take a moment now to rate each area of your business – attract, convert and maximise – as either:
- Green (working really well)
- Amber (could be improved)
- Red (not working or holding you back)
- Focus on any area which is amber first:
- Review that area to find the weak spots and create a plan of action to improve those
- Then decide what resources you need to make this improvement happen: do you need more training to develop your skills in this area? Do you need help from a mentor or consultant?
- Next look at any area which is red:
- Ask yourself, what do you need to install in to your practice to get this area working?
- If you don’t know what to do, or how to do it, find someone who can help you so you can get your foot of the brake and move forwards quickly.
Now you are ready to take action to get your foot of the brake!