Frugality

Coupon Clippers:

The buzz in the first quarter for most law firms will be watching expenses, and keeping clients happy and close. As we enter 2009, let's muse on effective cost cutting, as compared to silly and annoying pseudo-savings.

That font of all knowledge, and one of my fundamental sources of inspiration, Wikipedia, provides the following thoughts for achieving frugality: "Common strategies of frugality include the reduction of waste, curbing costly habits, suppressing instant gratification by means of fiscal self-restraint, seeking efficiency, avoiding traps, defying expensive social norms, embracing free (as in gratis) options, using barter, and staying well-informed about local circumstances and both market and product/service realities."

Now, I don't recommend barter as a particularly effective business method, it creates all sorts of tax issues and being a tax lawyer, I prefer to avoid tax issues and not invite them (besides, spending money on tax advice is NOT frugal).

Here are some thoughts on what I think is frugal in a law practice, and what is not:

Frugal:

Catered lunch meeting of six partners to discuss local circumstances, service realities, client service opportunities, and common client contacts.

Not:

Sending each partner out to buy her own lunch (15 minutes x 6 x $500/hour lost productivity = $750). Pizza would be cheaper.

Frugal:

Providing regularly-scheduled in-house MCLE (double bonus: young partners and associates gain experience preparing and presenting materials)

Not:

Allowing all attorneys to choose own continuing education programs, from Hawaii to New York, without budget or oversight constraints.

Frugal:

Supporting key local bar associations by sponsoring events.

Not:

Paying for a table of rubber chicken lunches that no one but unproductive associates will attend. Negotiate with the group the same sponsorship recognition by paying the net cost, without the lunches. Only the hotel loses out. (Unless the hotel is a client, in which case buy two tables.)

Frugal:

Encouraging double-sided printing and copying to reduce paper costs.

Not:

Discouraging the use of books and encouraging on-line research. Someone needs to explain to me how re-printing a code section or case time after time is more cost effective than using a book. Seriously, on-line research is NOT frugal if the researcher repeatedly prints the same materials.

Frugal:

Meeting with at least one client contact a week for coffee, lunch or another social event.

Not:

"Hunker down"

Frugal:

Engaging the entire staff, associates, paralegals, and administrative support, in seeking out cost-savings and better client service strategies.

Not:

"Business as usual."

In sum, the essence of frugality in the practice of law is the same as frugal living in general: prudence in avoiding waste. In other words, a frugal lawyer exercises good judgment in deciding how best to avoid wasted money, effort, time, and energy. The turn of the year is a good time to reflect on ways to be prudent in the practice of law for the benefit of our clients, prudent in the management of a law firm for the benefit of our staff, and prudent in energy spent on law practice for the benefit of our families. Modeling frugality is as important for law firm leaders today as it has ever been.

Cynthia