WHAT CAUSES LAW FIRMS TO FALTER?
There are several reasons law firms slump. The collapse and dissolution of a firm is usually the result of several debilitating factors conspiring to cause the downward spiral. A single problem in most cases can be identified and fixed rather quickly. When several issues plague a firm, partners often have trouble identifying the most important issues, and even when they do, it’s difficult to address all of them at once. While leaks in the proverbial management dam are being plugged on one part of the wall, water — i.e., cash — may be flowing out through other unattended leaks. Firms, in fine financial shape one day, may face major problems the next with the loss of one of their larger clients. This is especially true if a client represents an inordinate amount of the firm’s billings. Another fast-track path to instability is the defection of a group of attorneys to another firm. Even if the clients that leave with them aren’t large, the sheer volume of work lost can strain a firm’s f
