Most Solo Practitioners have spent years developing a growing and successful practice. Start planning your retirement now, take steps to create value. Establish benchmarks for revenue for future goals. Look for people internally and externally who fit the firm’s succession future image.
In developing your succession plan, you’ll need to consider what you plan on doing with your practice or your book of business. Should you take on a younger partner? Sell the practice? Time is a critical factor, don’t wait.
Succession planning is a process. The most challenging task will be to Identify a successor or where to take your book of business. A clearly developed transition plan must address management responsibilities and an orderly plan for the transition of client relationships.
“You’d be surprised how many rainmakers put off planning their succession plan or wait till it’s too late to achieve this goal. Often many don’t groom a successor for the firm. As a strategic consultant I help attorneys monetize their book of business as they wind down from the daily practice into retirement,” – Shari Davidson, President of On Balance Search Consultants.
The success of a succession plan is based on how much time you have and how much time you’ll need. Decisions must be based on what is best for you and or your firm.
1. Start by establishing the firm’s identity and value. Assigning the firm’s successor is critical, the leadership must be a good fit for the existing client base and future growth of the practice. A successful succession involves identifying or developing one or more effective leaders.
2. Transitioning clients can be a challenge. Relationships are built on trust, you cannot simply turn over a client’s business to another attorney. Make sure the client is happy with the new leadership or they will jump ship.
3. Compensation. Every practice has their unique circumstances that must be carefully crafted when establishing compensation. Get it right and everyone wins.
Running out time, follow these three options:
1. Shut the doors down. Understand you will be leaving money on the table.
2. Time is money. If time permits, groom a successor
3. Talk to a succession advisor to strategically create the retirement plan you desire.
The process can take anywhere from a few months to a few years. It took years to build your business, and it will take time to successfully execute a succession plan. A transactional lawyer can successfully wind down a practice in three to six months. A trial lawyer may be tied into existing cases for two or three years.
Ultimately it gets down to what strategy best meets your needs. Nothing is ever routine, recognize that this process takes time. Be realistic. Understand what the value of the firm is today and what you can reasonably expect in the future. Is your client base of value to another practice?
Perhaps your priorities have changed, or you’re being forced into retirement. You’ve got options, take your active book and work with a succession planner to set the stage for the next move in your career.
“My firm helps identify the best solution in the marketplace. We evaluate your options based on your practice area as well as the market trends, and then align the needs and desires to the best solution,” Shari Davidson, succession advisor.
Succession planning is not an event, it’s a process. A well-planned succession works towards grow-ing the firm’s worth and at the same time developing an exit strategy that will allow your clients to continue to be well represented.