Publications

Illinois Bar Journal

The Magazine of Illinois Lawyers

October 2011Volume 99Number 10Page 516

October 2011 Illinois Bar Journal Cover Image

Legal Technology/Practice Management

Does Your Law Firm Need a Virtual Reality?

By
Peter R. Olson

Do you really need that expensive office space you're leasing? Internet-based legal software innovations offer practitioners ways to cut costs while expanding their potential client base. And you can start small, adding cost-saving virtual parts to your practice before taking it all online.

Who enjoys their twice-daily rush hour commute to the office? If your commute occurs within Illinois, particularly Chicagoland, you're likely spending more time in your car and more money on gas than almost anyone in the United States. And it's your clients' time and money, too, if they're traveling to your office for consultations.

Is all that driving really the highest and best use of time? Let me suggest an alternative: a wholly or partially "virtual" law firm. And when I say virtual I don't mean a law firm that isn't real. I mean a law firm that is wholly or partially internet based.

Is a virtual practice right for you?

There are many issues to consider when weighing the viability of a virtual law practice, from personal and family considerations to professional matters such as your practice area and the number of staff in your firm. The firm's history is relevant, too.

For example, if you're starting a small law firm from scratch in 2011, the decision to launch as a solely virtual firm is easier and more seamless than a similarly situated firm in the same region with the same practice areas that has existed for 10 years as a traditional brick-and-mortar law firm with multiple onsite employees and a basement filled with client files. The brand-spanking new firm will find it easier to jump to the latest technology and a total online virtual practice, while the firm that has systems and technology in place may have a more challenging transition.

And if we assume that a virtual practice means more working from home, that might not be for you if there are kids running around. Plus, not all law practices are created equal, or at least not all are the same. My practice is court-centric with regular client contact but only sporadic in-person client meetings. A family mediator or small business adviser's practice likely revolves around frequent in-person client meetings where office space is important.

Total online practice versus virtual parts

In his seminar entitled Building and Managing a Virtual Law Firm (see sidebar), law firm consultant John W. Olmstead pointed out the distinction between partial virtual practices (doing certain virtual things) versus a total online virtual practice. My own experience with partial virtual practice illustrates the difference.

I started my Chicago-based solo law firm in 2005 and early on it was in most ways a fairly traditional brick-and-mortar firm. About a year into my practice I needed to add a legal assistant but had no desire to increase the amount of office space I was renting.

The first "virtual thing" I did in my law firm was to accommodate an off-site legal assistant by networking two laptops together, which allowed me to work uninterrupted while she connected to the documents and software programs she needed via one of the many computer sharing programs such as GoToMyPC or LogMeIn. A partner at a law firm I worked at previously used a similar set-up to work remotely from Florida.

Chicago lawyer Russell D. Knight needed to retain critical office staff, so he added a virtual element to his traditional law practice. "My secretary recently had complications with her pregnancy and candidly told me that she couldn't afford the time off but could still work from home. I bought two Fujitsu s1500 scanners, one for the office and one for her to take home," he said.

"I began scanning all our open files and put them on Dropbox.com. I go into the office in the morning and forward the calls to my secretary. She emails me as issues come up through the phone calls. Frankly, I'm really surprised how well it's going."

Step one toward a virtual law firm: creating online versions of your brick-and-mortar processes

My initial motivations to practice virtually were simple: cost-savings and convenience. Chicago commercial office space is costly. Beyond that, walking to my home's spare bedroom was far more convenient than walking to the train, riding it for 30 minutes, and then walking to my West Loop office.

The nature of my law practice was fundamentally the same the day after my office doors closed as it had been previously. The difference was that I had effectively trimmed my monthly business expenses by 70 percent.

This first step towards a virtual law practice, then, might involve transferring the exact processes you're currently doing at a single brick-and-mortar location to multiple people working in multiple locations without a centralized office location.

So how are telephones, mail, office communication, document sharing, and client meetings handled without an office? The first thing I did was opt for a "virtual office package" with the execu­tive suite landlord where we had previously had our brick-and-mortar location. Our office telephone number was already in their switchboard and familiarity with their personnel and office locations made this an easy transition.

If you're not familiar with the myri­ad of virtual office packages available, note that this is becoming a popular and competitive marketplace not just for lawyers but for home-based and service businesses generally. Common virtual office packages include telephone answering and call forwarding, a business mailing address, general receptionist services, and some set amount of office usage per month.

This worked well for me, since my office needs are on average some 10 hours monthly for new client consultations. Also, I'm no longer wed to a single office location. Our virtual office provider has many locations, which is an upgrade for client convenience, too.

Subsequently, my firm separated the various parts of our former virtual office package among multiple providers. Now our old office telephone and fax numbers get forwarded to each person's cell phone or e-mail address using eVoice and eFax, respectively. Our snail mail is sent to a P.O. box convenient to my legal assistant, and office space usage is paid hourly through the same temporary office provider on an as-needed basis. You could accomplish these initial steps in almost no time, put in an address change with the post office, transfer any fax/telephone numbers, and be up and running in a hurry.

Step two: moving to the cloud

The second step in my firm's new virtual reality was fundamentally changing how our staff's workflow and client communication occurred. As I mentioned above, even when I did maintain a traditional office location, my lone legal assistant worked from her home and remotely accessed our two-laptop network via the Internet. However, this set-up wasn't particularly scalable as new staff members were added - it literally required multiple people to share that lone computer - and it did absolutely nothing to help us interact with clients.

Until roughly the last year, our client communication remained very traditional and paper-based, with letters and court orders sent via USPS or e-mail. Over the last year, our focus has been getting everything up "into the cloud," i.e., onto the internet.

For my firm, the primary change has been to use cloud-based collaboration software. Everything that used to be sent via USPS or e-mail is now digitized and uploaded into the secure collaboration software program. That saves money, is more secure than e-mail, and is much less paper reliant.

Staff and clients alike have password-protected access to their online portal and are given e-mail notice when communication gets sent or new documents are uploaded. When my legal assistant completes a letter for my review or our law clerk finishes a research memo or needs to get copies of court-filed documents to me, they're simply uploaded. The old "client letter enclosing a copy of today's court order" gets uploaded, too.

We have moved to cloud-based accounting/billing and contacts management software (WorkingPoint), online appointment scheduling (Timetrade) and general calendaring (Google), plus collaboration software (Basecamp) for general project management, primarily in the form of document sharing between our dispersed staff and clients. (Cloud computing does raise some special ethics issues - see the sidebar for links to more information about that.)

When it comes to cloud-computing products, there's a lot to choose from. In fact, there's so much competition and innovation in these cloud-based software-as-services that there are almost too many choices, which can be paralyzing.

That's how my firm exists today, doing a number of virtual things, yet still meeting new clients face-to-face and making regular court appearances. It really doesn't feel too different than what we were doing five years ago. Though using these virtual options has not increased the size of our firm's profit pie, it has cut our costs and this raised our profit margin.

Step three: a totally online law practice

The third step - perhaps better described as taking the plunge - is to create a wholly online virtual law practice (either solely or as a supplement to your brick-and-mortar practice) that generates an income steam that did not exist previously. This might mean extending your geographic reach from the county or two that are convenient to your location to the entire state (or states) in which you're licensed. It could also mean remaining competitive in a commodity practice area with a virtual delivery model. A nouveau niche of lawyers is now offering fixed-rate and limited or ala carte legal services - aka "unbundled legal services" or "limited scope representation" - through a secure online platform with few in-person touches.

Although unbundled legal services have existed for some time, the latest version of the Illinois Rules of Professional Conduct, effective January 1, 2010, have helped to alleviate lawyers' ethical concerns. Currently rule 1.2(c) is unambiguous: "A lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent." For more on unbundled legal services, see the cover story in the October 2010 IBJ (see sidebar).

By definition, a completely virtual law office (VLO) is a professional law practice that exists online through a secure portal and is accessible to the client and the attorney anywhere the parties may access the internet. A VLO provides attorneys and clients with the ability to securely discuss matters online, download and upload documents for review, and handle other business transactions in a secure digital environment.

With a VLO, an attorney's clients bene­fit from both convenience and accessibility. The attorney benefits from the flexibility of a virtual law practice, an online client and revenue generating software, and lower overhead associated with maintenance of a nontraditional law office. Typically, a software-as-a-service technology platform, such as those offered by DirectLaw or Total Attorneys VLOTech, gets integrated with a lawyer's traditional website so the lawyer's basic web presence now includes a back-end secure portal where the client interaction takes place securely online.

North Carolina lawyer Stephanie L. Kimbro literally wrote the book on practicing law virtually. She authored Virtual Law Practice: How to Deliver Legal Services Online, published last year by the American Bar Association (see sidebar), and she practices what she preaches. For more than six years she has provided fixed-rated, limited legal services, primarily related to estate planning and small business start-ups, in a completely internet-based law practice.

In fact, most prospect and client interactions begin through the "New Client" and "Current Client Login" buttons on her firm's website at www.kimbrolaw.com. Client education as well as the contractual formalities of the limited scope engagement agreement - and, notably, the agreement's end-point - is vital.

"I will tell potential clients upfront what it will cost," she said. "If they approve of the quoted price and agree to the Terms and Conditions stated in the limited legal services agreement or 'clickwrap agreement,' they click 'accept' on the user login page and within a short time will have the ability to pay for and receive the requested legal services," says Kimbro. "Unbundling legal services is not limited to using document automation and assembly programs to deliver legal forms to consumers online. Unbundling is a complementary form of legal service delivery that may be used by traditional brick and mortar law practices, even those that focus on litigation."

Mokena lawyer Cheryl A. Morrison (www.camlawoffice.com) is a more recent adherent to an online virtual practice model. She uses DirectLaw's portal template and likes what she has seen so far. In fact, up until the last year or so she had a typical brick-and-mortar solo general practice in Will County.

"As the economy has gotten worse, it seems that more and more people are unable to afford the legal help they need," she said. "I hated turning away people who I knew that I could help but who didn't feel like they could afford to pay me. As I learned more about virtual law office technologies and the unbundling trend, I thought this would be a great way to fulfill this legal need while also allowing myself to convert these dead-end consultations into paying clients.

"I began by using DirectLaw's on-line platform as a means of secure communication with my current, traditional clients," she said. "DirectLaw provides the secure online platform and credit card processing that I use. It allows me to communicate securely with, upload docu­ments to, and invoice clients. DirectLaw also allows me to create customized intake questionnaires for clients so that I can automate my document preparation. I have also moved all my new client consultations to the online platform as well as contract and lease review work. Very soon, I will also be offering simple will and related document preparation to my online services and hope to add more services from there."

In other words, the document review, contract drafting, ghostwriting, and basic legal advice you've been providing in your county can now be offered as far away as your law license allows.

Get your head in the cloud

I'm often asked what were the best and worst decisions I've made since hanging my shingle back in 2005. Interestingly, the answers are opposite sides of the same coin. The worst decision? Overpaying for unnecessary downtown Chicago office space. The best? Getting rid of that overpriced office space.

Back then, I didn't know the myriad of office alternatives that existed. I sure do now, and even more possibilities exist six years hence.

Peter R. Olson (petero@olsonlawfirm.net) advocates on behalf of individuals, families, and children during adoption, dissolution of marriage, and parentage cases, many of which involve child custody, intricate property issues, the elderly, and persons with disabilities. He edits a law practice management blog at SoloinChicago.com.

More about virtual law practice

Generally

John W. Olmstead's presentation Building and Managing a Virtual Law Firm is available online as a for-credit ISBA FastCLE offering at http://isba.fastcle.com/store/seminar/seminar.php?seminar=6777.

North Carolina-based lawyer Stephanie L. Kimbro wrote Virtual Law Practice: How to Deliver Legal Services Online (2010 ABA). She also maintains a VLO blog at http://virtuallawpractice.org and a great list of resources at http://virtuallawpractice.org/about/.

Ethics

Kimbro addresses the special ethical issues raised by virtual law practice in an article for the Massachusetts Law Office Management Assistance Program at http://masslomap.blogspot.com/2010/08/guest-post-ethics-considerations-for.html and an online update to her book at http://virtuallawpractice.org/2010/10/ethics-opinions-related-to-virtual-law-practice-updates-to-book-appendix/.

Unbundled legal services

For more on unbundled legal services, see Helen Gunnarsson's cover story in the October 2010 IBJ at http://www.isba.org/ibj/2010/10/unbundlingexplained.

Kimbro offers an unbundling ebook, entitled Serving the DIY Client: A Guide to Unbundling Legal Services for the Private Practitioner. For more about it, see http://virtuallawpractice.org/a-guide-to-unbundling-legal-services/.


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