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Budgeting (Exactly What Does That Mean?)

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Most firm (business) owners begin to think about how their business has performed for the year and also begin thinking about how to improve upon that performance for the next calendar year around November. Without a target to measure against, performance is usually simply measured against how the firm did last year. Although better than no measuring stick at all, “better than last year” is not the optimum standard for which to gauge financial performance.

Ok…what is the optimum? Answer: a well prepared budget of expenses and a projection of expected revenue compared to actual performance. In other words, “What did we think would happen and what actually happened?” It is also at this time that we should be asking “What do we think will happen next year?”

Before we go further, let’s define, for purposes of this article, the word budget. (By the way, my wife’s only definition of it is that it is a rent-a-car company.) Budget is only meant to mean “what we expect to happen, given the circumstances as we know them today.” It does not mean that a certain amount of money is “set aside” to be spent on certain line items or groups of expenses and we will spend no more. As we all know, situations change and plans need to be somewhat flexible as the circumstances dictate.

So, how does one construct a budget of expenses? There are a myriad of different approaches, but the most simple is to actually begin with last year’s line item expenses analyzed on a monthly basis…then ask those “in the know” or those responsible for the spending decisions what they expect for the upcoming year, on a monthly basis, and why they expect “that” amount. This approach will create a valuable thought process and discussion. Each month a budget to actual analysis should be produced with all material variances scrutinized. If there is good reason for the variance….then great….no issue. But if we don’t know why there is a variance, the reason should be investigated and resolved. This is financial expense management 101.

Often we hear that in a plaintiff firm revenue projections are “impossible.” Untrue….they may be less accurate to predict… but not impossible. We go by the adage that if you aim at nothing, you hit it with amazing accuracy! We should set reasonable goals. You know, or should know, what cases are in inventory, your average case fee, and your time on desk. (If you don’t know these things, it is time for another conversation!) Armed with this information, reasonable expectation of revenues should be possible. You may also find that this information can be shared with individual attorneys so that they will have individual targets based on their case loads. We have found that the conversations that these projections provoke are valuable in themselves.

This goes without saying…but I am going to say it anyway! Even though we are attempting to predict the future for the firm financially….ultimate case handling (settlement, trial, etc.) must be dictated by what is best for the client. Never, should a case be resolved to “hit” financial objectives of the law firm.

By spending the time to create an “as accurate as possible” expense budget and revenue projection, profitability targets can be established. A review of “how we did last year” according to our plan and “what does next year’s plan look like” are the basis of a sound financial review and planning process.

It has been our experience that the firms that follow this process get better at it year after year and the budget to actual variances are rarely surprises. The work put into the monthly and annual budget to actual comparisons and the annual budget/projection exercise, substantially reduce the stress of simply not knowing where the firm stands at any given time….thus improving the quality of life for the stakeholders of the firm.

And that is what it is really all about, isn’t it?

Top 7 Mistakes Law Firms Make During Intake: #1 The Silent Killer

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At Vista we have audited the intake processes, systems, and personnel of firms all over the country. Intake is one of the few things at your firm where you can fix something today and see big results tomorrow. We enjoy analyzing the process step by step and finding inefficiencies that increase our clients’ signups without increasing their spend. There are several common things that we see firms struggle with, but there is one that very few pay attention to, yet it costs them thousands of dollars (sometimes hundreds of thousands) a year in lost revenue.

What is it? The mistake many firms make is not tracking or improperly tracking whether a decision has been made to sign up or reject every single lead that comes through the firm. This is the situation where someone calls your firm, you take down their information and for whatever reason, no one proactively decides whether this is a case you are going to attempt to sign up or reject. That may sound improbable, and you may be saying that this doesn’t happen at your firm, but on average this can cause a 5%-10% decrease in signups if you are not handling this process properly.

For the firms that we work with, we typically create a “No Decision” report that is monitored throughout the day. The systems for intake are set up so that someone has to flag the file in the case management system as an accept, reject, or no contact (we will talk about these next week). If the field is left blank, it shows up on the “No Decision” report and gets remedied immediately.

For firms that do track this decision in some form or fashion, we also see some that track it improperly. The most common error is that firms write over this information with different information so that they cannot accurately run reports. An example of this is when a firm has a case that they don’t make a decision on, so they flag it as “pending decision” or some similar status. What then happens is that the firm never goes back to finalize that decision or it gets moved to a different status such as “reject” by default, without a decision being made. The way to alleviate this is to have a field in your case management system that is dedicated to tracking the decision that was made regarding accepting the case in house or rejecting it. I realize that there is a third option, which is referring it out, but that is a separate process.

If you would like Vista to audit your intake department, don’t hesitate to contact us. We will take a look at your systems, processes, and reporting, and give you details on how to make improvements.

Apply Sam Walton’s Customer Service Commandments To Your Firm

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Say what you want about Wal-Mart today, when Sam Walton was building this multi-national company, he was fanatical about client service. He was adamant that his leadership team was not only familiar with, but followed 11 Customer Service Commandments. We could all do well by adapting these concepts to our firms. Here they are (replaced “customers” with “clients” and “business” with “firm”):

  1. Our clients are the most important people in our firm.
  2. Clients are not dependent upon us; we are dependent upon them.
  3. Clients are not interruptions of our work; they are the purpose of our work.
  4. Clients do us a favor when they use us; we are not doing them a favor by serving them.
  5. Clients are a part of our business; they are not outsiders.
  6. Clients are not people with whom you argue or match wits.
  7. Clients are people who bring us their wants, and it is our job to fill those wants.
  8. Clients are not cold statistics, they are flesh and blood human beings with emotions and feelings like our own.
  9. Clients are deserving of the most courteous and attentive treatment we can give them.
  10. Clients are the people that make it possible to pay everyone’s salary.
  11. Clients are the lifeblood of our firm.

Leaders Are Readers… My Reading List

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Leaders are readers. The best leaders we know are readers. They are always looking for new concepts, ideas, and practices to bring to their team. Create your reading list and get started. Take 15 minutes a day and dive in!

Micki…I don’t have the time to read! If you are like many owners, you are probably thinking you don’t have time each week, let alone each day, to read a book. I get it. I remember the days when I was running a multi-state law firm with 150+ employees and trying to juggle all of the demands being put on me, personally and professionally. Life can be crazy. However, if you have a passion for something or a desire to be better at something, you will commit the time it takes to ensure you are the best. Also, technology is advancing every day and we are able to connect with our favorite books and authors in so many more ways than in the past. I’m still a fan of having the actual book and reading it (I like to make notes in the book, dogear pages to refer to later and create a list of the best parts of the book for future reference, but my friend loves audio books and listens to them while working out. My point is, you can find the time if you are committed to the process. We tend to make time for what is most important, so I encourage you to make time for this.

Here are a few of my favorite reads…I refer to these books routinely when looking for answers on how to solve operational inefficiencies or to gain momentum in different areas.

    • Mastering the Rockefeller Habits: What you Must Do to Increase the Value of Your Fast-Growth Firm – Verne Harnish. This is the book I referred to the most when a firm I worked for was experiencing tremendous growth. I still refer to this book several times per year to help me find direction for clients or help me think outside of the box. I also refer to it to evaluate the growth model of the firm and make informed decisions. Hands down, this is one of the books I refer to most often.
    • Rocket Fuel – Gino Wickman & Mark C. Winters. Again, one of my favorites (I’m passionate about law firms and a little competitive, so I always want my firms to be the BEST in their market!). Wickman & Winters do a great job of outlining the roles necessary for a company to succeed and the difference between the Integrator and the Visionary Roles. This book provides owners with answers to many of the nightmare issues they deal with day in and day out of running a business. Wickman & Winters have another great book you should check out called Traction.
    • Double Double: How to Double Your Revenue and Profit in 3 Years or Less – Cameron Herold. Double Your Revenue, yes please! Double Your Profit….HECK YEAH!!!! I mean, who wouldn’t want to double their profits, right! Many years ago, a firm I worked with took two days to plan out how we were going to double revenue. We brainstormed and created a roadmap for how we believed we were going to get there. We implemented that plan and it was a turning point for that firm. At Vista, we now walk other firms through this process and have seen some great results! If you are looking to create an action plan, to double your revenue and profit, this is a must read. Cameron’s books are a must on your entrepreneurial quest to have the best, most profitable business. This book has practical and actionable items you can put in place now to make a difference in your practice.
    • Scaling Up: How a Few Companies Make It…and Why the Rest Don’t – Verne Harnish. This book is also known as Rockefeller Habits 2.0. This book has earned many distinguished awards for business publications. Use this book as a workbook (Harnish provides you the worksheets) to accomplish your vision. You may need to think outside of the box when putting these worksheets into action for your law firm – but if you do and you execute the exercises and then revisit them each six months, you will continually see growth and improvement at your firm.
    • The E Myth Revisited – Michael Gerber. This book can be a little verbose and is likely why it isn’t higher on my reading list, but I do believe this is a must for your business building library.
    • Good to Great – Jim Collins. Excellent read! I’m certain most every entrepreneur has been instructed to read this book at least once in their careers. I would definitely suggest putting this on your reading list. This is one to take on a long airplane ride as it’s very long, but definitely worth the read. You should also add Collins’ book, Great By Choice, to your reading list.
    • Death by Meeting – Patrick Lencioni. This is a must read for owners who follow the Good to Great adage of working “on the business, not in the business.” What often happens is an owner will start to feel as though he or she is not in the “know” when they start to put people in the right seats to handle the tasks they have previously handled. So, to eliminate their fear they will create meetings so people can inform the owner about different things they are doing and provide feedback. What happens, unfortunately, is that the feedback turns into directives and instead of continuing to work “on the business” the owners will slide back into working “in the business” because they believe they can do the job better than anyone else. This fable, along with Lencioni’s other book The Five Dysfunctions of a Team, are must haves in your reading inventory.
    • How to be a Great Boss – Gino Wickman & Rene Bower. People are the key to your success. They will have the power to make your company great or keep your company mediocre. Your ability to connect with them and help them be the best version of themselves directly relates to your ability to relate to them and encourage them. Wickman provides practical advice and tools that worked for more many different industries. His advice in this book will help you relate to your team and more importantly teach you the difference between leadership and management and how to apply both to your business.
    • The Power Paradox – Dacher Keltner. Okay, this one makes it onto my list because I believe in the theory as he describes it in his book. To be honest, this book is a little boring to read and I don’t refer to it often, but if you are building a great business you need great people on board. Keltner has an interesting theory that I do refer to often when trying to help law firms build great teams for future success.
    • Who – Geoff Smart & Randy Street. Smart & Street offer practical advice on what is commonly known as the “biggest problem in business,” as they put it: hiring. This book will help you find the right people to put in the right seats on your bus.
    • Crucial Conversations – Kerry Patterson. Want to get better at tough conversations? Great read for owners, management team, or anyone that is charged with leading difficult conversations. We believe that tough conversations are critical to high performance and this book walks you through how to have them.
    • Built to Sell – John Warrillow
    • Simplify – Richard Koch
    • Getting Everything You Can Out of All You’ve Got – Jay Abraham
    • Guerilla Marketing In 30 Days – Conrad, Levinson & Lautenslager
    • Purple Cow – Seth Godin

If you have a favorite book, please look me up on Facebook or Linkedin and share it with me! I love law firm operations, making firms more profitable and I want to learn, too!

Your People Are NOT Your Most Valuable Resource

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What? That’s not what we’ve been told since we became managers. How can this be?

It’s true, your people are not your most valuable resource….the RIGHT people are!

Ok….Ok….Ok…now we get it. But how do we know if we have the right people?

First, how did you hire them?

Did you have an intentional process to attempt to fit the person with the position? Did you explain the position, the detailed job description, and the scorecard (how their performance will be judged) to the candidate? Did you have them explain to you why they are the right person for that particular job? Did you allow them to shadow someone currently performing these tasks in your firm? Did you allow other members of your team with whom he/she will be working to assess the “fit” in the operation? Is the compensation offered/expected commensurate with the position?

Answering these questions in the affirmative will put you and your team in the place of most potential to succeed in hiring the right person. No….there will never be 100% assurance we will hit a home run in this process. But going through the above steps will certainly raise your batting average!

Second, what if a current team member is underperforming?

Before any more formal evaluation, a performance/attitude assessment should be thought out. In other words, is it truly a performance issue or an attitude issue? If it is an attitude issue, a serious crucial conversation must be had with the team member explaining your perception. Then, observation of behavior changes (or not) should occur. If positive, great! If not, it may be time to provide the employee with an opportunity to find the right fit in another organization.

If attitude is not the issue, management MUST evaluate if it has provided the team member TTE (Tools, Training, and an explanation of Expectations). By assuming that the employee should just “get it,” we are doing them a disservice. Without the proper tools, training, and understanding of what is expected, how can the team member truly excel? Yes, some do just “get it,” but most will not…and this is not a people problem most of the time, but a failure of management.

If management explained to me that my job, and their expectation, was that I dunk a basketball, obviously I would know what is expected of me. But if they simply told me that, without giving me the proper tools (a trampoline) and training (how to use the tramp), I would still be unable to perform up to par. Telling me I am failing without TTE does nothing but further frustrate my actual performance and may then lead to an attitude issue.

For your team to perform at potential, maybe it is time for an assessment of management’s performance. Have we done our job in providing TTE to every member in our organization? If not, don’t point at the employee’s lack of performance… assess management’s!

As Pogo once said, “We have met the enemy, and he is us.”

How Do I Get My Team On the Same Page?

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To paraphrase Verne Harnish, the author of “Mastering the Rockefeller Habits” and “Scaling Up,” if you want everyone to be on the same page, first there must be a page.

Sounds simplistic, but you would be surprised how much impact this small discipline can have at your firm. As leaders (and everyone at the firm is a leader in some capacity), we often expect those around us to read our minds and know exactly what we are trying to accomplish. We are shocked that those around us don’t know exactly what we mean. “I told you in that meeting”…”I sent you that email”…”We talked about it the other day”…. We need clarity on the direction of our firms, and it needs to be understood by our leaders. Here is how we recommend that you do it.

  1. Set the Vision – At Vista, we recommend that the leaders at the firm take time each year to set the direction of the firm. For most of the firms that we work with, this is typically done in November or December. If the firm has not gone through this process in awhile (more than a year or never), we recommend that they stop what they are doing and go through this process.

    We tell them to write down today’s date, then write down the same date three years from now, and imagine what your firm looks like if you got everything right—if you were able to mold it the way that you wanted to. How many cases are you handling? How many cases is the firm handling? What types of clients do you have? What types of practice areas are you handling? What is total revenue? What is total profit? Are there key hires that you have made? Are there other personnel changes you have made? Jot all these ideas down on paper and start to flesh out what that firm looks like. If you are not excited about owning or working at that firm, go back to the drawing board until you have created a vision that excites you and your leadership team.

    Once you go through this exercise for three years out, ask yourself, “In order to get there three years from now, where do I need to be one year from now?” Then, go through the same exercise and create a picture of what your firm looks like one year from now and reduce it to writing.

  2. Determine How You Will Measure Progress – Once you have clarity on what you want your firm to look like three years from now and one year from now, the next questions are, “How are you going to measure progress in each of those areas?” and “How often are you going to measure progress in those areas?” The easy answer is that we recommend that you measure progress on a weekly basis. Your leadership team should be getting together on a weekly basis, and going over progress towards reaching the overall vision should be a part of that meeting. How are you going to measure progress? There are a number of ways to measure progress, and it can be different for different types of initiatives. It may be a percent complete, milestones, or a target number. Whatever it is, get agreement on it, and if you discover a better way to measure progress, don’t be afraid to adapt. One of the best books out there on the subject is “The Four Disciplines of Execution” by Chris McChesney.
  3. Take on Projects that Align with Your Vision – There are a lot of good ideas out there. However, not all of them are good ideas for your firm. We all read books, go to conferences, and talk to colleagues about great things to implement. However, before we implement, we should ask ourselves, “Does this get me closer to the vision for my firm?” You can only do some much at any given time. It is important that you choose the things that will have the biggest impact on getting your firm where you want it to go. So many times we see owners or leadership at firms implement things just because they heard someone else was doing it. Don’t do that. You will frustrate your team and make them feel like they are running in circles. Focus on what matters. What matters for another firm might not matter for your firm.
  4. Communicate the Vision Regularly – Once you have the Vision for the firm in writing, share it with your leaders. Everyone should be able to look at it, understand it, and understand their role in making it happen. If there is confusion, it should be clarified immediately. If your leaders are taking on projects that don’t line up with this vision, it should be questioned whether it is the appropriate use of resources. We recommend that the leaders of your team get together on a weekly basis, at a minimum, to discuss progress toward this vision.

3 Ways to Grow a Plaintiff Law Firm (and there are only 3)

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In most businesses, there are really 4 ways to grow the operation:

  1. Increase the number of customers;
  2. Increase the transaction frequency;
  3. Increase the average value of each revenue generating interaction, and;
  4. Increase the efficiency and effectiveness of each business process.

For plaintiff firms, scratch Number 2. Though some clients are repeat clients, your firm cannot count on repeat cases from the same plaintiff.

Number 1: Increase the number of clients/cases the firm handles. The importance of getting more clients for your firm in a cost effective manner is paramount. All efforts should be made to assure that the firm is retaining a very high percentage (92 %+) of the clients that reach out to you through your current marketing efforts. Prior to expending more marketing money to reach additional “new” client leads, all efforts should be made to market back to your current list of clients who have come through your firm. This may sound curiously like attempting to increase the frequency of a profitable interaction with the same client; however, the marketing touch here should be targeted to asking them for a referral of new clients who may need the same type service as the client that has passed through your firm. We believe that a past client should be touched, in some way, 7 times per year….and, always with a specific ask for referrals. This practice of touching will keep your brand in front of your best referral sources, as well as reminding them of the great experience they had while working with your firm. (I am assuming it was great…see number 4 below. Do you have an effective client experience process?)

Number 3: Increase the average case fee. Do you know your average case fee per case type within your firm for the last 12 months (or any selected period)? If not, you should. This base knowledge will allow you to measure improvement as you apply the proper systems to potentially increase these average fees. These systems would include:

  • Ranking incoming cases initially and at 90 days into the case in order to assure the bigger cases are handled by your best attorneys;
  • Systems that allow for potential application of value drivers to cases (MRIs, injections, surgeries);
  • Knowing your firm’s Pareto point fee value (the lowest case fee dollar amount where 80% of your revenue is produced);
  • Pushing these cases with potential values above the Pareto point to your top attorneys, and;
  • Creating a committee of your top attorneys to review your top 20% cases.

Number 4: Increase the efficiency and effectiveness of each process within the firm. Have you considered how a case makes its way through your firm? From the time the lead is received (by phone, web, or walk-in) until the time of resolution and then an ongoing marketing cycle, each process should be examined applying industry best practices and assuring an accountability system is in place.

So there you have it….there are only 3 ways to grow a plaintiff firm. Simple…but not easy.

Ignore them at your peril.

Team Huddles – Making Them Work For Your Firm

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Nearly everyone is familiar with a “huddle.”  It is the quick meeting that the quarterback holds with his offense before they run a play.  It keeps everyone on the same page and communicates vital information before things get crazy.  In Verne Harnish’s book, “The Rockefeller Habits”, he talks about the importance of having huddles with your team at your company.  I also believe that they are a very important tool in running your firm and when you get them right, they can be powerful. However, I have also seen firms get them wrong and they can be tedious, boring and sap energy from the office.  Here are some tips and strategies for implementing huddles and getting them right at your firm:

1. Start and end on time.  Huddles are meant to be quick, 10-15 minutes, most of the time everyone is standing up, and they need to keep moving.  Starting them on time, keeping them on track, and making sure that they finish on time keeps the energy alive.  The purpose is to improve communication, recognize and reward good things going on in the firm, acknowledge areas where the firm needs to improve, and to keep people on track with what is important.  It is not a place to solve problems or troubleshoot issues.  Those items need to be taken “offline” and addressed after the huddle.

2. Keep the energy up.  Make it fun, give it some energy and get more than one person talking. It is a chance to let people know the exciting things going on at the firm, great results you are getting for your clients, feedback from clients, and great things people are doing.  If none of those things are going on at your office, you have bigger issues than running a huddle.  They are going on and this is a great place to highlight and recognize them.  This builds your culture and encourages the vibe you want to cultivate.

3. Find a frequency that works for you. Verne Harnish recommends having huddles on a daily basis.  I think that is a good frequency when you are working to get them off the ground because it gives you more chances to change things up and see what works.   However, for most law firms I have worked with, after the initial period, a weekly huddle seems to work best. It prevents it from getting stale and seems to accomplish its purpose.  I would not recommend going to anything less frequent than once a week.

4. Don’t be afraid to make changes. Find a rhythm that works for you.  There will be things that don’t work (lots at the beginning) and if they are not a good fit, then change it up. It took our firm, and many firms that I work with, several tries to get their huddle right.  But if the format is a drag or it is not serving its purpose, make changes to get it right.  Make it your own.

There are a lot of upsides to getting this right. I think huddles play a big role in proactively shaping your culture, in improving client service, and building a better team. If you have never tried having huddles at your office, these tips will help you get started. If you have tried them in the past and they have not worked, some of these tips may help you get it right.

Let Your Team Exercise Their Decision Making Muscle

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When you make a decision, you are exercising your “decision making” muscle. The more you do it, the stronger it gets and the more confidence you gain in your ability to make decisions.  You can feel this happening, after you make a tough decision, other decisions often seem much easier to make.  This is the same with your team.  When they exercise their decision making ability, they get stronger and better at making decisions in the future.

Let your team make decisions on their own so that they can build their decision making muscles.  Here are some warning signs of a team that doesn’t have a lot of decision making muscle:

1. They present problems, not solutions.  If your team brings you problems without any recommendations, they probably need to work on their decision making muscle.  A team that either handles issues as they arise, or brings  you issues with proposed solutions, has confidence in their ability to make decisions.  The Ritz Carlton gives most of its employees up to $1,500 in decision making authority to make decisions that will improve the experience of their guests.  That is letting them exercise their decision making muscle.

 

2. They don’t speak up in meetings.  When people are afraid of making decisions or in an environment that doesn’t encourage making decisions, they are self-conscious about bringing forth solutions.  The next time you have a meeting, ask yourself how much participation are you getting from your team? Are you doing all the talking or is your team providing input and discussion. Does everyone always agree with your point of view, or do they feel comfortable in challenging your ideas? Organizations that support exercising the decision making muscle have engaged communication.

 

3. There is a lot of “Monday Morning Quarterbacking”.  The term “Monday Morning Quarterbacking” refers to second guessing the decisions made by the quarterback in SUnday’s football game.  The quarterback had to make decisions in the heat of the moment, with the best information that was available at the time. It is often much easier to look back and second guess those decisions.  However, the organization that does so in a critical way will prevent its team from exercising its decision making muscle in the future.  Don’t second guess decisions, you may need to correct and make changes, but don’t go back and criticize the decision that was made in the heat of the moment. The time to challenge it is when the decision is being made, not after it has been made.

 

4. Bottlenecks.  Bottlenecks often occur because there is a hold up in the decision making process.  If only a few people have the ability to make decisions, then all decision making “traffic” leads to them and it creates a bottleneck. Think of the projects that are lagging behind schedule, is it because it reached a decision making bottleneck? Most likely the answer is “yes”.   Identify those bottlenecks, and ask yourself what decisions did someone hold onto to keep those projects from moving?

Support your team when they make decisions. Coach them through the process, gradually build up the responsibility you give them, but let them make decisions and don’t do it for them. It only weakens their ability to make decisions in the future and it hurts your organization.  If you want to grow, you need a team that is confident and capable of making good decisions on their own.

Measuring & Judging

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As an accountant by training, my tendency is to attempt to measure everything in business and make decisions based on those measurements. Measurements… like how many calls came in, how many were converted to customers, how much did each customer spend, how long did you work, and how many widgets did you produce, etc…you know…counting things!

In fact, we have been known to say, “What you can measure, you can manage”. In the world of repetitive tasks, such as an assembly line process, this perspective may be very successful. But the business world of today has many fewer repetitive, factory worker type, tasks and many more unique selling and production opportunities. The environment has changed to a knowledge worker dominated work force as opposed to a factory worker dominated work force. In an environment such as this, measurement in and of itself can be difficult at its best and yield worthless information at its worst. Managers should take note, as managing a knowledge worker is much different than managing a factory worker.

Measuring how long a knowledge worker, someone who thinks for a living, sits at his or her desk, though relatively easy to do, will not necessarily assist a manager in assessing the productivity and value of this type worker. Sure the workers are there, but are they productive? You then may think, “Let’s measure the knowledge worker’s output.” Again, on the surface, this sounds pretty good… and easy…but what if the output is of great quantity but poor quality? Will the customer be happy?

I hope you are beginning to get the picture that judgment in the world of business management is beginning to take the place of pure measurement. A rather silly example is that measuring the efficiency (how many operations performed) of a brain surgeon is not nearly as relevant as judging his effectiveness (how successful were the ones that he did perform). I don’t know about you …but give me effective in this case every time!

Because our firm is totally comprised of knowledge workers, I have given up all together on certain measurements as a management tool. In fact, we have
adopted, what we call, a Results Only Work Environment (a ROWE). We do not complete time sheets, we do not have set office hours, we do not have set holidays, we do not have “overtime”, and we do not measure our value by how long we are at the office. But what we do track is how effective are we in completing a task in a timely manner and in the highest quality fashion. We judge how happy our customers are with our deliverables and services. We also hire quality people who are very well capable of knowing the tasks they need to accomplish, the associated timetables, and the quality expected. We treat them like adults (though sometimes we play like children) and judge the quality and effectiveness of their output.

In the business world today…judgment trumps measurement every time!

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