Wit and Wisdom from Down Under

New Zealanders and Aussies are just fantastic. Their cultures seem to be much more receptive to experimenting with new ideas, as evidenced by the number of Trailblazers we have from Down Under. Our senior fellows, Peter Byers and Yan Zhu, continue to help accounting and law firms transform into Firms of the Future at a dazzling pace.So I'm always thrilled to hear progress reports from firms who get it. One such firm is Trailblazer Matthew Tol + Associates.So I begin this post with the Wisdom of Matthew Tol, from a recent email he sent me:

Ron,Just came across an interesting couple of quotes which could summarise the issues we're dealing with when we try and change the profession from the "bad old ways":In the confrontation between the stream and the rock, the stream always wins...not through strength but through perseverance. H Jackson BrownPredominant opinions are generally the opinions of the generation that is vanishing. Benjamin DisraeliI find the second quote very true—we are talking about a generational change in the way we should approach our professional dealings with our customers. Moving people from entrenched positions is incredibly difficult and causes great angst amongst those trying to change and those trying to effect the change. It is the fear of what could go wrong rather than the focus on what can go right that makes many people scared of the process.By getting the right focus and mindset, the change can be done but it will take a little time. We'll just keep working away at the early adopters and progressive thinkers until the snowball gets bigger. It will grow—has to. Given the current environment, I find that we are seeing more customers needing clarity and comfort. We can provide them with certainty in their dealings with us through the value pricing and no timesheet model. The time is terrific to be in this space and it encourages our customers to really use us to assist them through these supposedly tumultuous times.As I mentioned to you in a post recently, we've had a greater level of enquiry over the past couple of months than we've had in years—all by referral, all great businesses and all loving the fact that we won't bill them for a phone call or for photocopying. These small things make a critical difference (ref Paddi Lund's "Critical non-Essentials")—they make us different and higher on the value tree than our competitors. All contributes to our success and allows the team to flourish whilst the customers are getting terrific outcomes. These things are surely what it's all about.Now, what code do I post this to?Cheers,M

Now for the Wit. This comes from John Chisholm, a consultant to professional knowledge firms. He was a dear friend of our mutual friend, Paul O'Byrne, traveling with him extensively throughout New Zealand and Australia preaching Firm of the Future principles.We at VeraSage have felt for a long time that mockery is more effective than logic when it comes to changing paradigms. Consider the movie Airplane. That one single movie killed off an entire genre of disaster films from the 1970s. We need to do the same to the billable hour and timesheets. This letter from John is a great start:

January 2009Dear ClientRe: Our EngagementI am writing to you quite frankly because I am being made to and for no other reason.I know you have not asked me—or if you have I have conveniently ignored you—to confirm our terms of engagement but regrettably some regulations demand that I send you this letter.Firstly I want to thank you for your instructions. I am ever so grateful because it means that I and my team can now reach our monthly fee budget. This means that I will not be subject to judgement by others in the firm but will clearly be in a position to judge others.I am required by law to give you an estimate or range of the fees you are likely to spend with us, set out our method of charging and a few other extraneous and irrelevant matters.You will be pleased to know that I will personally look after your matter—unless something more profitable or interesting pops up—but you can be assured of service commensurate with the quantum of the fees you will be paying us. At various times I will have a team of lawyers, paralegals, graduates and whoever else maybe struggling to reach their budget assisting me. Please be assured that regardless of whether I will be actually working on your file or not, I will make sure that some of my time is added to your file to reflect my level of importance in the firm.If you have any queries at any time please do not hesitate to contact my p.a who will screen your call and determine whether it is important enough for me to speak to you direct. If you wish, you could always send me an email however given the level of technical skills I possess, it is unlikely I would be able to open it let alone respond.In respect of our charges as you would appreciate (or you would if you were partner in our firm) it is very difficult for us to be precise on what your total legal fees in this matter might be.This is because we charge solely according to the time we spend on your matter (which is in the firm's best interest and if it is in our best interest it must be in yours) and I have no way of knowing how much time we will need to spend on your matter in advance. It is not that I have not had experience in this type of matter before its just that, well every case is different. I may be a good lawyer but I have absolutely no skills nor training in pricing so any precise fee I would give to you wouldn't be much use to either of us. Indeed, it may be disadvantageous to me as it may mean I have to achieve an outcome for you regardless of my ability to make my monthly budget—not a pressure I would like to have. I hope you will understand.It is also not in my interest to give you a precise figure anyway primarily because you might hold me to it. Even if I were to give you a precise figure you might not like that figure and choose to shop around, or ask me how I arrived at that figure. Worse still you might seek to negotiate a different fee with me.I am prepared however to give you a range which may—or may not—be of some assistance. Based on what you have told me to date, which I know was not much because I have not asked you many questions, I can with some confidence state that your fees are unlikely to be any less than $20,000 (in fact I can positively guarantee they will not be any less than $20,000 looking at my budget month to date) and are unlikely—but not impossible—to exceed $200,000.Everyone at our firm is proudly assigned an hourly rate at the commencement of each financial year (although we do reserve the right to change the rates at anytime without telling you in advance). You are lucky to be dealing with me who as a senior partner can command extraordinarily high charge out rates. As the senior partner I can guarantee my rates will always be higher than anyone else in the firm as you will note from Appendix 1 attached which lists all members of the firm and their current hourly charge out rate.Whilst we all have an hourly rate for your convenience we break down our rates into 6 minute units of time and charge you for each 6 minutes or part thereof we spend on your file. Please be assured however that we will NEVER spend less than 2 hours doing anything on your file.You will be pleased to know that at our firm we rarely sleep and you can be assured that often 24 hours per day we will be thinking about your case and how to achieve the best results for you. With advances in technology it is even possible for us to think about your matter for more than 24 hours per day.Again for your convenience we will bill you monthly. Actually we will raise an internal tax invoice for you on the last day of each month (notwithstanding when we actually do work on your file) but sometimes we may not get around to actually sending you the tax invoice until a few days/weeks later and as such I apologise in advance for the nasty letters/phone calls you may receive from those awful people in our credit department who will be unaware that the invoice may have not been sent to you (although they should be used to that by now). Just ignore them—I do.You will also note on our tax invoice that it states you are required to pay our account in full within 14 days. No client has ever done that yet and I would hate you to set a precedent so please also disregard that and pay us whenever you feel like it.We urge you to read the attached 24 page Complaints Procedure (which we are quite proud of). In short you have one day in each month (on the full moon between the hours of midnight and 2 am) in which to lodge your complaint personally by hand.Finally I sincerely wish you the best of luck being a client of this firm—you are going to need it!RegardsSenior PartnerP.S. I neglected to inform you about our firm's most profitable practice area—Disbursements. In addition to our professional fees we will also charge you non-professional fees such as photocopying, binding, telephone calls, taxi fares, tea and coffee (espresso), lunch, dinner, red wine, chocolate biscuits, use of our meeting rooms, the cost of our Christmas gift to you, the cost of sending you our bills and follow up letters and any other expenses we can get away with passing on to you. Of course we do not just pass on the total cost of these items—there is always a healthy mark up applied.

Ron Baker

Ron is a Founder of the VeraSage Institute and Radio talk-show host.

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