Tom's Blog

I read today that they are soon to launch a free operating system to rival Windows and increasingly are offering applications that run on their servers.

Looking first at the basic software that we all use, until now we have had little choice other than to pay Microsoft huge amounts of money for their products. Windows is far from cheap and Office is also costly, and yet they have time and again been launched while still full of infuriating bugs. No other supplier of anything gets away with dumping inadequately developed products on the public as Microsoft has done over the years. Updates mean further significant investment (remember that the Service Packs may be free but they only fix problems that should never have been there in the first place - new versions such as Office 2007 always have to be bought). Furthermore, MS software is ridiculously heavy on data, resulting in computers that take ages to fire up in the morning and that need to be pretty powerful to cope, with costly processors and other components.

But the new faster broadband speeds are making a whole raft of things possible. No longer will you have to have everything on your desktop PC or office servers and no longer will you have to have a machine with power. You will be able to run your software on someone else's servers, software that is free and is always up to date. Your own machine will only need to be as powerful as it needs to be to match your broadband speed, a good deal less than is normal today, and think of the flexibility. Instead of being locked to your own machinery you will be able to work anywhere you can get an internet connection. I know many firms now provide such a facility with the ability to log in to their servers but such operating methods will become routine for all, not just the big firms.

In our sector there are now a rising number of software houses that will provide you with a similar service with specialised legal software. OK, so it will not come free but I predict that costs will fall quite heavily as the cost of providing such service without endless site vists and so on falls.

And Google and Open Office are leading the way. If I was running Microsoft I'd be getting very worried. The vital thing for us in the profession is to keep up to date with these developments, maximise the gain you achieve and spend only what you need to spend. Just think how you'd feel if you'd just blown £70,000 or £100,000 on upgrading the IT in a small office, only to find months later that it was all unnecessary!

3/6/09 - Free Software

Being a typical tight Yorkshireman (my clients never need to fear that I'll ever waste their money!) I have become increasingly interested to see how the suite of OpenOffice software has been developing. It now seems to offer a thoroughly well sorted set of applications that, in a small firm at least, can provide a truly viable alternative to the ubiquitous Microsoft Office. The MS product is good, but it is stonkingly expensive and if you are looking to upgrade 50 or 60 computers and looking at also upgrading your software I believe that it is now well worth a look. Click here and see what you think: http://www.openoffice.org 

Microsoft have built a vastly profitable empire and have often employed some pretty nasty strategy to dominate the market. Like Tesco, they have used their financial muscle to bring unfair pressure to bear and as an example Internet Explorer was driven into something over 90% of the market by their bullying techniques. Google are far from perfect but I have found it heartening to see them pushing Microsoft back with some excellent products, all free. I downloaded their Chrome browser a few weeks ago and love it, and I'm also getting increasingly enthusiastic about their online calendar. It is beautifully easy to use and can be acccessed with any internet device and I'm thinking through how well it could work in a solicitors' firm - I think the answer could be "very well". Has any reader tried this approach? If so I'd love to hear from you.

With broadband speeds at current levels we have an exciting new option. Perhaps we no longer need costly networks and servers, VPNs and other expensive infrastructure, with all the expense of buying, leasing, depreciating and maintaining them. Just perhaps we can begin to use the internet and free or low cost web-based services instead.

With technical things developing so quickly, we must never ever make the mistake of believing that we have it sorted. New possibilities open up almost every month.

I7/3/09 - Find a Solicitor

I've just been exchanging emails with the people who run the Law Society's website. Discovered quite by chance that if you search on a city you only get the 50 most central firms. A major firm like Addleshaw Goddard, for example, is most certainly listed if you search by firm name, and with all branches including Leeds, but if you search by city on "Leeds" you don't see it, because there are 50 firms with offices that apparently are more central.

I've suggested that this policy is actually quite unfair. There must be dozens of firms around the country that don't get listed under their city's name for this reason but which nevertheless can be regarded very much as local firms with a city centre presence. They must be losing enquiries as a result. It's far too arbitrary and I hope the web designers will think again.

3/11/08 - Key Business Finance - A Possible Way Forward

It is well known now that Key is in administration - did you get caught? It seems that they had struck an agreement with some insurers to accept payment of financed premiums in mid-November, six weeks after they would normally have been due. Now, when most of us finance something we expect that the finance company will pay for the goods or services almost immediately the agreement is signed but in this case this six weeks added an element of risk that none of us either were or indeed could be aware of. Firms got caught because insurers agreed to what amounted to a side deal with Key, one that borrowers had no knowledge of. And as such, is it reasonable that borrowers should carry any losses? Or should they be for the account of the insurers? That is perhaps an interesting one for the lawyers among you but I would have thought it was something well worth exploring.

Over to you.........

8/10/08 - THE BANKING CRISIS IS HITTING US ALL

Did you finance your PI insurance premium through Key Business Finance?

If so you must stop any further payments to them until the situation is clearer.

You may already be aware of this but Key is a part of Heritable Bank and in turn part of the Icelandic bank Landsbanki, which has been taken iover by the Icelandic government and is believed to be insolvent. My calls to the Key Business Finance office this morning went unanswered and it seems that they may have ceased trading, although I have no firm information on this as I write.

I have discovered from the broker that arranged cover for a client firm that the capital advance under their finance agreement with Key, or in other words the lump sum payment to the insurer, is only scheduled to be paid on 13th November. This client has already paid a significant deposit, which may or may not now be lost, but one fears that further payments may be money down the drain.

Naturally you must each make your own judgements on this but my inclination would be to cancel direct debits immediately until the situation can be clarified. Initial deposits may have been made by cheque, in which case if it has cleared there is nothing you can do to recover it, but any further payments will be by Direct Debit. If so you can stop further payment and may be able to reclaim past payments under the D.D. guarantee scheme, altough as I think this only covers payments taken wrongly in some way you may not have a case. You could try aguing that you feel you have been badly miled by Key. After all, when you entered into the agreement were you made aware that the capital sum would not be advanced until some six weeks after the insurance year started? Most of us assume that when we borrow money the lender pays up promptly.

As a side issue, it rather changes our view of the interest rate they charge if we later find that we will have made three payments before a penny is advanced. We all assumed, I think, that WE were borrowing money and that there was no downside risk. We had absolutely no idea that we were lending money for this initial period and so were at risk.

And, of course, as soon as you have clarified where you stand on this you may well have to arrange to pay your premium in some other way.

I'll pass on any further news as soon as I get it.

17/8/08 - The Slowdown Intensifies

News of redundancies in the profession is coming thick and fast at the moment. Some firms are handling things well and with as much sensitivity as possible, whereas others are showing their usual "flair" in all things to do with the handling of their staff. They do things in an unplanned way, fail to consult properly, destroy morale throughout the firm and leave themselves open to expensive-to-handle challenges in the employment tribunal. There is simply no alternative to the correct procedure and unless you have an employment specialist within your firm I would suggest strongly that you find one outside. The few hundred pounds it would cost would be insurance against a costly mistake.

The old adage sounds cruel but it has logic. "Cut early and cut deep" is based on the need to do anything nasty just once. By cutting early you stop the trading losses before they become threatening. Cutting deep means that you can put the bad news behind you in one go and start afresh with a team of an affordable size. Morale among your staff at such a time will be grim but if the rest can be told, honestly and openly, that you really believe that this will be it they will heave a sigh of relief and get back to work with a will. Most are intensly loyal to their firms and will put in all possible effort to restore the firm to good health as quickly as possible.

23/7/08 - Conveyancing - A Meltdown

Hasn't it been alarming just how quickly it has all turned around? Many residential property departments are looking at new instruction levels down by 70% and there is no sign of an improvement. Right now I am seeing departments still doing some work but things tailing off rapidly. New matter figures are miserable and often consist largely of HIPs instructions and the associated sale, something that may well not happen for a very long time. Indeed, I think we are all expecting it to be well into 2009 before things start to improve and then it may only be gradual. The biggest killer seems to be the difficulty in obtaining mortgages.

So what do we do? There seems to be little alternative to reducing the size of your department and many firms are doing so. We can re-double our marketing efforts but in my recent experience, visiting estate agencies at the moment can be pretty depressing and is best avoided!

For my thoughts on redundancies click here.

Perhaps now is the perfect time to really sort out that conveyancing case management system - after all, no one can complain of being too busy at the moment.............

27/5/08 - Lexis Nexis - Good but......

I recently found a small firm, with annual turnover of under £1 million, paying £36,000 a year to Lexis Nexis for their online services. We tried and tried to get something done about this - it was very probably a mistake and if it wasn't it was clearly unaffordable. After much pushing and getting absolutely nowhere in desperation we stopped the monthly direct debit, thinking that this would spark them into action. We expected their Credit Control to stop the account but they seem to be in as much disarray as the rest of the company. We had not one request for money and enjoyed around nine months service without paying, and for all I know might still be doing so now if we hadn't tried yet again to bring things to a head.

It's sorted now and a mistake had been made. The ongoing cost is high but just about acceptable; the service is good. But we learned a couple of lessons:

1) Check costs against other suppliers such as Westlaw or Justis

2) Watch carefully that Lexis Nexis charge the correct amount, and

3) Check that you are only buying those services that you need. If you ask, Lexis Nexis will send you a spreadsheet of your own firm's usage data. We were able, for example, to cut out the Taxation element, which was hardly being used at all and is largely available free elsewhere (e.g. the Revenue & Customs site, and others). We also discovered that on our minimal usage our "hits" on Litigation were costing us £194 each!

4) And finally check that online really is the best way to buy this information. The excellent Hammicks will happily do you a comparison against their book lists and in some cases can reduce your costs significantly.

26/5/08 - Driven? Hardly.......

I am getting more and more frustrated by poorly-performing fee earners (FEs).

It is surely true to say that this is the biggest single cause of poor profitability among smaller law firms. With partners signing all the cheques it is rare for money to be wasted on running costs but at the other end they seem to have far less control. I regularly see FEs billing barely 2x their salaries and chargeable time figures too often show people managing just 60 to 80 hours per month. When we all spend around 150 hours per month at the office you have to ask yourself what on earth such people are doing all day.

 I have been aware of this for some time but in recent months it almost seems to have become an epidemic. Time and again I'm coming across firms in which the partners are doing all the work and other FEs are coasting.

The solution? I'm afraid it can only ever be pressure. They must be gently eased out of their little bubbles of self-satisfaction with monthly performance meetings (sometimes called "Pastorals" or "One-to-Ones") at which it is made clear that the right contribution is not optional. Don't just criticise but discuss with them what they can do, and what if anything they need, if they are to begin to achieve. Set realistic targets, make it clear that thay are expected to hit them, and use the meetings to demonstrate that you are on their case, nicely but firmly - it may be the first time anyone has done this and I come across FEs who don't know what their targets are and who never hear anything from anyone about them. Publish league tables to reward the performers and expose the slackers and perhaps give a bottle of Chamgpagne each month to whoever has upped their game by the greatest amount. Do, however, remember to include WIP gains and losses in their figures - a poor billing month may still have been a good overall month if an FE has added significantly to their WIP. And also remember to take bad debts into account.