6 industry trends every sole practitioner needs to stay apace with
Building and running your own legal practice is a phenomenal and enormously satisfying achievement.
There are challenges too though, as I found out myself.
Building up and maintaining the infrastructure of your practice, all those things that people who have never built a business don’t even know exist, can be hard work.
Keeping up to date with risk-management, compliance and administration, IT systems and cyber security, digital marketing strategies and business development, training and professional development takes its toll.
It can become difficult to find enough time for your clients, let alone to drive new business or to recruit.
I have witnessed these challenges first hand.
In this report, we explore six ways to ease the increasing burden facing sole legal practitioners here in the UK, which we hope will help you to take your sole practice to the next level.
Trend #1: IT infrastructure & cyber security
We live in a world of pervasive cyber-attacks, growing data protection regulations and increasing client concern about cyber security.
World-class information technology systems are no longer a nice-to-have for the more technology-minded sole practitioner, they have become a critical element of any commercial legal practice.
Moreover, as emerging legal technologies come on stream and are increasingly useful, so-called “tech-stacks” are becoming increasingly important.
Tech-stacks, for the uninitiated, are combinations of IT systems, from the more traditional word processing software plus document management system, to the more advanced practice management systems, document automation systems, contract review technologies and anti-malware systems.
Practices are becoming more and more integrated, with customer relationship management systems talking to practice management systems, which in turn are talking to accounting systems to automate all manner of functions from onboarding to invoicing, from engagement to contract review.
We are just at the beginning of the progress of these technologies. If it hasn’t already, running a sole practice without a high-quality tech-stack is going to put the sole practitioner at an increasing disadvantage as the years roll by.
If you haven’t already, it’s time to get up to speed in this field before you are left behind. It will be important to start making some progress here.
Start by seeking out providers of practice management systems and accounting/book-keeping systems; then look at document management systems. If you can find one of each that you like the look and price of, and that integrate natively, that’s a great start.
Then look around to identify the more advanced technologies that are likely to suit your practice and check what the options are for integrating those advanced systems into your core three.
Remember, it’s always possible to build custom integrations between providers that you particularly like if there is no native integration available, and a whole industry of technologists is available to support such integrations.
There are also a selection of workflow automation technologies that can help you to fill in the gaps (between your systems) or add new functionality of your own, as and when you identify a need.
The core aim should be to produce a stack of technologies that work together seamlessly and that will automate as many as possible of the repetitive tasks and core activities of your practice. For relatively little expense (albeit a fairly heavy initial time commitment) you can build a small but super helpful “machine” to support your daily grind.
At the same time, I thoroughly recommend going outside to look for outsourced IT support and, ideally, a separate cyber security auditor. Having this level of support overseeing the building and maintenance of your IT systems, testing for vulnerabilities and suggesting upgrades or settings changes on an ongoing basis will make all the difference to the quality and safety of your systems.
Ideally, you will also end up with a certification, even the entry level Cyber Essentials accreditation is a starting point on your journey towards cyber security.
Accreditations provide a useful and regimental framework for pursuing your cyber security activities and provide clients with a much needed sense of comfort that you have the security of their information front of mind.
At the end of this process, you will have developed a high-functioning, time-saving IT system, which is bespoke to your practice, fully supported and cyber secure. This is time and money worth spending.
Trend #2: Navigating SRA obligations & professional indemnity insurance
Many recently formed sole practices in England & Wales have taken advantage of the SRA’s new framework enabling solicitors to “practise” (i.e. refer to themselves as “solicitors” or “lawyers” and provide legal advice to the public) but without being an employee or member of a separately authorised law firm.
This was a ground-breaking reform in the regulatory landscape that came into effect in 2019. It was perhaps even more transformational than the introduction of alternative business structures in the Legal Services Act 2007, which allowed non-lawyers to own and manage law firms for the first time.
If anything, this new framework came into effect to legitimise the recent explosion in the consultancy model, with freelance lawyers (and their non-authorised personal services companies) working hand-in-glove with consultancy platforms, “New Law” firms and alternative legal service providers, many of which were themselves not authorised.
However, more broadly the reforms were designed to reduce the burden on start-up and small practices in order to introduce some much needed competition and downwards price pressure across sectors of the legal market.
Since 2019, provided that you are not offering restricted legal activities (largely litigation, probate and conveyancing related), there appears on the surface to be little advantage to the sole practitioner, from a regulatory standpoint, of gaining SRA authorisation and seeking the SRA minimum terms professional indemnity insurance cover that comes as part and parcel of such authorisation.
This seismic change has opened up huge opportunities, particularly for business lawyers, to ply their trades without all the red-tape of yore.
Having said that, some problems remain.
The number one concern is the adequacy (or inadequacy) of the laissez-faire approach taken by the SRA to requirements for professional indemnity insurance for non-authorised practices.
It can be challenging to obtain adequate PI insurance to cover a non-authorised legal practice (there are providers but very few understand the nuances) and, perhaps more worryingly, it is clear that these providers do not offer anything like the same level of cover as is offered under the standard minimum terms of the mandated SRA level indemnity insurance for authorised firms.
Reports of “worryingly cheap” policies are rife across the industry. Perhaps time will tell whether allowing unauthorised firms to seek their own insurance terms was the right approach.
Should insurers start refusing to cover claims brought against non-authorised solicitors’ practices, effectively rendering those practices insolvent, the SRA may start to revisit its approach.
On the other hand, essentially all sole practices established prior to 2019 remain as authorised firms, carrying the significantly heavier burden of continued authorisation and the significantly heavier price tag of SRA level PI insurance. Many of them likely wish they had been offered the same opportunities as practices established post-2019.
For these authorised sole practices, it is of course difficult (read, expensive) to step out of the regulated landscape, once you’re in it, given the regulatory requirements for run-off insurance cover in particular.
Those still operating in the freelance or consultancy space, likely have not had to worry about weighing the pros and cons of either choice. Their dilemma is more likely around the cut of fees taken by the platforms they partner with.
What is clear is that a stark choice is faced by most sole practitioners: seek authorisation, the gold standard, and take the full plunge or stay out of the regulated water, but risk inadequate insurance arrangements.
As the insurance market matures, we may find more suitable and reliable policies emerging for unauthorised firms.
For the authorised sole practices out there, identifying and working with the best broker and the best SRA compliance support providers you can find will pay huge dividends.
Trend #3: Outsourced back office support
There is a huge burden associated with administering the back-office function of any commercial legal practice.
This work often takes over far too large a proportion of a sole practitioner’s time and energy.
The best solution is to outsource as much of this burden as possible to book-keepers, providers of document production support, call answering support, marketing support, company secretarial support, IT support, compliance support, secure storage companies and so on.
Of course, it can take time and resources to identify and engage so many outsourced providers, but they are worth their weight in gold (once chosen correctly and up and running).
Despite the expense (and many of these providers operate “pay-as-you-go models), they will give you a distinct advantage and allow you to focus your time on the critical elements of your practice: your client work, your business development activities and your own professional development.
We suggest starting by putting in place one or two core providers for your most time consuming items and work up from there.
Secret #4: Join a community or network
One of the biggest dangers of operating as a sole practitioner is the propensity to become isolated and the default lack of a referral community.
Where at all possible, sole practitioners should seek to join networks, social media groups and professional communities of lawyers and other professional services providers, to maximise the opportunities of networking and referring work across these communities.
These networks can also be an excellent sources of additional expertise and support, which may be much needed by your own clients, as much as a source of new work and referrals.
Beyond the immediate financial and practical benefits of being part of a broader community, it is simply better for our health and well-being to have a community of like-minded colleagues and acquaintances to interact with for support and advice.
LinkedIn is a great starting point for social media groups, but local chambers of commerce and industry sector organisations can be more welcoming and more helpful, particularly for in-person interaction.
Secret #5: Training & professional development
Typically, we see the first thing to be sacrificed by overstretched sole practitioners is a commitment to their own ongoing learning and development.
It is critical, particularly in a world that moves on so quickly, to stay up-to-date on the latest legal developments as much as on the latest industry and technology developments.
Given so little time to fit everything in, it is only natural that commitments to oneself come last, but failing to develop one’s own knowledge and awareness is not only a disservice to ourselves, but also to our clients.
There are genuinely high quality opportunities for training and development made available by the Law Society and a whole universe of expert trainers.
Beyond that of course, we must all simply take the time to identify areas in which our knowledge is lacking, we all know what those areas are, obtain knowledge resources in those areas (normally relatively inexpensively) and deliberately and consciously take the time to sit down with enough energy and freshness to work through those materials with care.
Very few CPD activities will be anywhere near as effective as carefully directed and committed self-learning.
We owe this time and effort to ourselves, not least because it is a regulatory requirement, but also because our fears of being left behind or outwitted are so easily cured with some regular, self-directed learning.
Secret #6: Digital marketing & business development
LinkedIn, Google, Facebook and other networks provide extraordinary opportunities to get your message out there, in a very carefully targeted way and in a way that controls your budget.
A great website, a blog, intelligent and informed use of social media and a digital marketing platform that pulls all of your marketing resources together in one place, all of these things can make an enormous difference.
Working together, these elements can provide extraordinary opportunities for letting prospective clients know that you exist and starting to develop a relationship with those clients in an automated and systematic way, with very little ongoing input.
A warning though, putting a great digital marketing strategy and infrastructure in place is a significant undertaking and whilst the results can be extraordinary, the input, in terms of the initial time and learning curve, should not be underestimated.
Bringing it all together
By taking the time to develop your tech-stack, by clarifying and optimising your regulatory position, by outsourcing time-consuming back-office tasks, by joining the right networks and communities, by focussing regularly on your own professional development and by developing an automated marketing machine you can put your sole practice back on a war footing.
Above all else, of course, it is critical just to take the time to reflect on the non-negotiable top-line priorities for your practice and focus your efforts on those items above all else.
As in all walks of life, we only have so much time, money and energy available, it is critical to devote our resources to the highest priority matters, then outsource the rest!
But I know that is no mean feat.
We firmly believe that we can help entrepreneurial sole-practitioners to solve these problems and more here at Clearlake.
We have built, from the ground up, a vehicle for facilitating sole practitioners to build extraordinary lives and extraordinary practices. In fact, that is our core purpose.
To learn more about what’s on offer at Clearlake, take a look at our careers website.
