When a law firm is challenged by departures, loss of clients, a reduction in business, litigation or other adverse developments, it is troubled. The challenges may not place the firm in dire circumstances, but its situation requires a thoughtful examination of where it finds itself. If justified by the self-assessment, the firm may be spurned into adopting an action plan to deal with the causes of its trouble. If it does little or nothing in the face of that assessment, it likely will see things get worse before they get better.

With any signs of trouble or stress appearing, management can count on five truths. Their presence does not necessarily represent the advent of crisis or command management to take specific forms of action. Rather, these five truths should be viewed as givens that frame the environment where the troubled law firm resides. The Truths:

More Vulnerable. A firm in trouble is more vulnerable to further adversity just as a child with a cold is more likely to get sick. Such a firm is weaker and it needs to respond quickly to any developments, even ones that might have evoked little concern during better times. Because of the added vulnerability, management must develop a greater sense of awareness and sensitivity to change that may be taking place.

Less Control. Clearly, when any company is in full-fledged distress, its ability to control its destiny is compromised. A firm not yet in distress can still be in trouble. As trouble begins to surface the degree of control maintained by the firm over its situation will lessen as the trouble grows in severity.  A sliding scale begins to take hold, meaning that as reason for concern grows, control begins to slide away.

Less Time. Anytime problems begin to afflict a law firm, it becomes important that issues be evaluated, understood and addressed as quickly as possible. The luxury of deferring issue resolution to later is usually not available. Because less time exists, procrastination cannot be tolerated.

Less Do-Overs. One aspect of a law firm being in trouble is that action plans adopted to resolve the problem must be right the first time. Typically there is little opportunity to try something out to see if it works and then come back when it doesn’t and try something new. Careful analysis of the issues and development of a sound strategy is far better than shooting from the hip because of the pressure to “do something.”

Bad News Spreads Like a Forest Fire. When law firm management begins to see signs of trouble, it will not be too long after that when the rank and file begins to sense something is amiss. If bad news or unfounded rumors surface, they will spread like a wind blown forest fire-even if the news that is spread is not completely true or fair.  Communicating clearly and precisely is important to dealing with adverse news and rumor.  And good communication skills are essential to establishing credibility. Silence, or missteps in communication, can allow bad news to go unchecked and can destroy credibility.

Do you see other Truths that are present when a law firm is in trouble?