Calico Legal Solutions - Compass 5 by chartered-one

C O M PA S S

2020 COVID-19 RECESSI0N EDITION calicolegalgroup.co.uk

Issue # 05 | Business articles written by legal industry experts

T h e Com p l et e Gu i d e O n

Gr ow i n g a L aw Fi r m : Cov i d - 19 Ed i ti on

W el com e to th i s Sp eci al Ed i t i on of Com p ass f r om Cal i co L egal Sol u ti on s Gr ou p Challenging t imes don't mean a lack of opport unit y. This is the positive message the group would like to convey to you in this collection of articles . It has been a challenging time for all of us, personally and in business. But after a complete re-think on what is achievable for law firms there is no better time to make positive change supported by trusted partners, assembled here. Do join us online at the regular Online Forums - find out more on the 'What's On' page on the Calico website. . Pau l i n e Fr eegar d M B A

Con ten ts

St ay A l er t, Con t r ol A n x i et y, Save Fi r m s.

T h r i v i n g I n A Recessi on

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The Five Stages to Recovery - to set the scene for this special edition we look first at how far we have come and how far we have to go to reach a new equilibrium.

Planning for recovery. What are the practical steps that law firms can take in the short, medium and long-term to ensure they survive and thrive?

Creating a catalyst for sensible, positive change to future-proof a business.

U n d er Pr essu r e Firms have fared pretty well in the face of the challenges over the past months, and may now feel able to implement more beneficial change. However, we look at 7 main pressure points to consider in any project.

T h e Cr eat or of I n ven t i on I s N ecessi ty

Cal i co L egal Sol u t i on s Gr ou p

A Bu m p I n T h e Road ?

120 staff Lincolnshire law firm, Harrison Drury, explain their fast-track experience of moving to home working. Laura Dover, Operations Director, shares her thoughts on a safe return to the office whilst reaping the transformational benefits.

Who are we? Find out more and access contact details for all Calico Legal Solutions Group members.

Deferments in VAT, PAYE and income tax payments leave a potentially large bump in the road when they crystalise in Q1 of 2021. What are the practical actions that firms can take to avoid the upcoming financial pitfalls?

M en t al H eal t h & T h e Pr of essi on

W h y a V i r tu al FD M akes Sen se.

The legal profession already retains undeniable levels of pressure, with a myriad of differing drivers. Why mental health is more important than ever.

There are more part-time financial directors as well as virtual ones, and the Covid pandemic is only catalysing that change. We look at the pro's and con's of accessing additional financial expertise in this way.

T h e I m p act O f Cov i d - 19 on y ou r PI I

D ow n l oad T h e Cal i co A p p

M eet T h e Ex p er t Au t h or s

Placing solicitors?business with insurers has become increasingly difficult and more expensive, what can you do to minimise premium uplifts?

Access every new article from the smartphone app, and tailor the newsfeed to the topics and Authors you are interested in. Download using the QR code for iOS or Android phones.

A bio on all the Authors in this edition of Compass.

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T h e 5 Stages of Recover y

Stay A l er t, Con tr ol A n x i ety, Save Fi r m s M artyn Best, D ocument D irect One of the silver linings in recent weeks has been the opportunity to listen to things that one may not have had the time to do before - and in the company of people who now have the time to reflect on such matters. I was on a webinar recently, very kindly hosted by Legal Geek, and Richard Susskind, who you must have heard of, was talking about the 5 stages we will be encountering during this current COVID-19 period. He and Daniel Susskind wrote on this topic, and I have, with thanks to them, adapted their thoughts for this piece. Who really knows what will happen, but he did bring a calm confidence to the subject, which was mildly re-assuring? We might view what we are going through as consisting of five stages.

St age 3 is our current and developing debat e - t he emergence

St age 1 has been mobilisat ion - we have all just done t his.

However, st age 4 will emerge soon enough, and t hat will be t he surge.

From office to home in one bound - five years of change and transformation swallowed within five weeks. A victory for pragmatism versus caution, expediency beating a greater shade of doom. I wonder how many levels of reticence were leaped, and how much conservatism was put to one side, as firms recognised, they needed to act quickly to keep their businesses, and their flow of communication moving. It does seem that we have survived in one shape or form - not ideal of course, but we have adapted well, and we live to fight another day.

Just as there is little doubt that the second quarter of 2020 will be a nightmare, then one of the following two quarters will be a boom, as economic activity recovers. This will not be your traditional recession ? in fact, Brexit aside, the economy was in fair shape as 2020 started, and there is clearly a massive pent-up demand. Those who will gain will be those who have shown their true and positive colours during stages 2 and 3. Actions and attitudes will be recognised and those who looked after their staff as well as they could, and their clients throughout these next months will find that loyalty rewarded. A focus on core values, on truly engaged communication across the spectrum of our relationships, and of keeping belief in a positive outcome will be amongst the qualities we need to show now.

St age 2 is t he lockdown - sadly st ill enduring in places, and may ret urn in t he form of furt her local measures This may go on for some time, and we are experiencing another tug of war - health versus wealth. Now, there is a philosophical challenge made real. The debate will be a very difficult one, and the choices are stark. Sensitivity and great care are needed, and the balance between our vulnerable ones, and the future of us and our younger ones is a delicate balance. During this time, we will initially be very inefficient, loss-making, and will find it difficult to adapt - but slowly, our new world becomes real. We will grasp how to use those technologies we have resisted and avoided, and we will find ways to engage with staff and our clients. Tough decisions on our overhead base, our payroll and our values will be made. Those who will gain the most are those who retain their core values whilst embracing the necessity of change.

This looks like it will be a ping-pong event depending on what policies are adopted and what guidelines are followed. Too much release, we are back in lockdown, too little, and we never emerge. Stay at home, go to work, keep distant, get a little closer, but not too close, open up, close down? . Phew! It is quite likely that as we emerge, the clear impact of some over-exuberance will give rise to a return to some restrictions, and this is probably going to be a very frustrating phase.

Then st age 5 - t he new equilibrium. Normal is not the right word, as what can we ever call normal? We will certainly return to a way of life that we are more familiar with, and there may be some fundamental changes, or more likely some nuanced ones. The use of technology will accelerate and the reliance on traditional physical resources will change. There will undoubtedly be a greater comfort in using some of our new-found uses for technologies that have been around for some time, there may be a lower dependence on property and offices, and certainly there will be some new ways of working that will benefit us all. So, what to do?. Well, a reflection of these stages and where we are is something to weave into your changing strategy. This may be one of the areas in which the phrase ?stay alert?has some true meaning. CALICOLEGALGROUP.CO.UK | 5

Recover y af t er Cov i d - 19

A n d T h r i v i n g i n a Recessi on M artin Langan, Legal Workflow I?m sure a lot of lawyers and law firms are struggling to cope with the lockdown. Many aren?t set up for homeworking, social distancing or self-isolation. And it?s all happened so quickly there has been very little time to prepare. Yet this is when your clients?minds are really focused on what?s important to them, and they?ll be looking to you for advice and to set contingencies in place. Here are some suggestions, from my own experience, and the experience of others close to me, on how you might manage things in the short-term, the medium-term and in the longer -term.

document management systems on the market that take document filing to another level, with all documents of any kind instantly available online, from any location on any device. These products can in many instances be integrated with case management systems, or standalone if you prefer.

Full marks if you always scan all incoming hard copy correspondence and other documents into your document management system, because this enables the full case content to be seen electronically, essential in times of crisis such as this, where almost everyone is required to work at home. How does post get physically scanned if there is no one in the office?

Ease of access t o files If you have a document or case management system, you should store them all in document management. What about documents that are not client-related, such as admin or management documents? There are excellent commercially available web-based 6 | CALICOLEGALGROUP.CO.UK

You might consider it reasonable for one fully consenting person to attend the office, with appropriate gloves and other protective equipment, to scan all post and distribute it electronically to the correct cases and people.

The options are to send all printing to the central location where the person scanning incoming post can print and send out an outgoing post, or to print to a local printer and go out and post the documents. The former would appear for most firms to be the most economic in terms of minimising the number of people who would be out and about. Homeworking environment

Virt ual meet ings

Good cloud-based software can be accessed from anywhere on any device, but what if your device isn?t up to scratch? Computers are quite simple to move from one location to another these days, both because they are less bulky than they used to be, and they are pretty much plug and play.

If you?ve resisted video technology for meetings so far, now is the time to consider it. People still appreciate being able to look into the eyes of the person they are talking to, perhaps now more than ever, with isolation imposed on us.

Without adequate protection, this presents a serious security risk, so make sure that each machine requires secure login procedures and is protected by up to date, centrally managed, anti-virus and other protections. Instigate dual or multi-factor authentication, which requires at least a secondary approval on another device, usually a mobile phone, to gain access. Products are available for very little cost and are easily deployed.

Phone services A VOIP phone system will enable you to replicate making, receiving and transferring calls as though you were in the office. If matched with a softphone licence that enables a headset or microphone and speaker to be plugged into your PC you can take calls via the computer rather than on a handset.

Many commercial products facilitate instant and schedule meetings with multiple persons, screen sharing while in the meeting for demonstration and explanatory purposes, chat between people through messaging within the meeting, whiteboards for illustration purposes, and call recording. These come at a cost, but don?t overlook offerings that may already be included within your existing subscriptions, particularly Microsoft Teams, which is available within Office 365 subscriptions. Office 365 in itself is a must for our logistically difficult circumstances, as the key Office products are available to you online and on most devices.

Online legal services It has long been my belief that the real value of online legal services is the blend of human and machine that the software can facilitate. On the other side of the coin, most lawyers are too burdened with archaic methods of processing work and no quality time to spend with their clients. Collaboration software overcomes this and is the perfect antidote to 80% of unmet legal need, which research points to, and lawyers having no time for their clients and falling out of love with their jobs.

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PostA p ocaly p se Pl an s

Alex H olt, T he Cashroom

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I?m sure everyone has had discussions from a safe distance.

similar

?The first thing I?m going to do after lockdown is? ?

Often these are dreams of returning to favourite places in the company of favourite people. There are also many plans based on things we are now going to do that we have always intended to do. The bucket list stuff.

While the idea of a Lancashire beer garden is idyllic, and the thought of reconnecting with friends and family is wonderful, there are of course for many businesses some choppy and uncharted waters ahead. So much of it can be labelled ?unknown?, because after all these are truly unprecedented times. However I think we should challenge that way of thinking where the business is concerned.

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It?s perhaps too easy to say that the circumstances we are in, and the market conditions we will face, were unforeseeable. ?How could we have planned for this?? But the idea of market shifts is never a new one. Yes, this is an extreme version, but similar themes remain. It?s easy at the moment to become reactive on the basis that things are constantly changing. It becomes almost an excuse for inactivity and inertia. I think we can all do better than that. We need to get ahead of reacting in the moment. If we can cast our eyes a little further ahead and base our thinking on some reasonable assumptions, that gives us a better starting point.

Business continuity ? one definition of insanity is doing the same things over and over again and expecting a different outcome. If further lockdowns occur due to

flare-ups of infection, or if in two years?time there?s a different virus, or freak weather conditions prevent normal working practice, are you going to try the same approach to keeping your business alive? Or will you learn and adapt your plans ? better technology investment, more careful consideration of property requirements, better channels of communication with your customers?

And on that latter point, how will your customers react, and what will they be looking to buy? It?s likely that you can foresee some spikes of activity in certain sectors. How are you going to shape your business to focus on those areas, and what are you going to do about the other parts of your business that have slowed down? In the last recession, everyone stopped doing property work for months and laid people off. The problem came a year or two later when property work boomed back and the resources had become rarer than hens? teeth.

Business performance - here, there are things we can address which, frankly, we knew all along but perhaps never had the impetus to address. There will be some areas in your business that you?ve always known are too expensive, or too inefficient. Now is the time to redesign. To seek to future proof your business. Get the best possible process operating. Use your systems to give you the best and most accurate data on which to base your business decisions.

Of course, this present pandemic is unique in its variety of challenges, but let?s use it as a catalyst for sensible, positive change in our businesses. I?ll drink a nice pint in my sunlit Lancashire beer garden to that (one day? ).

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Road t o Recover y :

U n d er Pr essu r e Peter Gill, Engage Solutions Group

As law firms start to think about the physical return to work and business recovery, I thought I?d just do a quick round-up of seven particular pressure points that keep coming up in chats, meetings, webinars etc, and that are exercising leadership as we move through the next phase of the pandemic.

One ? ?We need more on mobile?. There?s widespread recognition that the mass mobilisation of workers has been an incredible feat, with kudos to the IT staff who reacted so well. Plus fee earner work and effective collaboration have owed a lot to project tools like Microsoft Teams. But the passing weeks have also revealed that for many people ?agility? still has them tethered to their laptop, still reliant on email, still plugging into a static intranet. Expect more on mobile strategy in the weeks and months ahead.

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Two ? ?There has t o be a single source of t rut h? The need to control the narrative, manage information flow, direct tailored messaging and keep people on side has shone a harsh light on firms? ability to communicate to everyone quickly and easily, and to give staff the reassurance of a ?go-to?place for the latest news and directions. Myriad WhatsApp groups or unstructured chats in Teams are no answer ? you need a trusted corporate channel that can get to everyone in a timely fashion. Three ? ?Is our int ranet really fit for purpose?? It goes to the mobile point above. Some firms are definitely struggling to deliver on operational essentials because their intranet is old and static, and certainly not geared to enablement and self-service, or indeed pushing out key content at this critical time. Thoughts are turning to a genuine workplace companion, something accessible 24/7 across multiple devices.

Six ? ?Managing t he healt h of t he firm lit erally and met aphorically? Not so much about managing the public health aspects of the virus, but more about people?s individual well-being and the collective mood towards the business. Covid has placed unique stressors on the workforce and the workplace and monitoring how a firm rebuilds, keeping all its constituent people parts intact, is a massive challenge.

Seven ? ?W hat will client engagement look like in t he mont hs t o come?? There?s a natural concern that for all the regular interactions firms have with their clients ? the calls, emails, video conferences ? the limits on face-to-face meetings, on professional events, social occasions, all that classic in-person networking stuff, that those limits will impact relationships. Suddenly the touchpoints in between matters aren?t happening the way they used to, so firms and partners need to rethink how they manage the client lifecycle, how they strengthen the end-to-end relationship when some of its weapons of choice are no longer so freely available.

Four ? ?How do we push out not ificat ions t o support business cont inuit y planning?? If the VPN is down, what solution do we have in place that provides access to everybody in the firm? There?s often the challenge that not everybody has a firm mobile device and not everybody has registered their personal mobile to receive messages. The need to communicate with the whole firm or sub-groups has been highlighted, and how can this be easily enabled to ensure everybody is on an alert list?

What should encourage firms is that throughout this unprecedented, hyper-stressful situation, they have done pretty well all things considered and should look to the future somewhat emboldened ? there?s definitely latitude to try new things, to experiment, to properly innovate because there is no playbook for this, there is no-one who will call you out on your ideas. There?s been a lot of talk more generally about doing things differently post-Covid. For law firms, perhaps that should extend to different technologies too.

Five ? ?W hat are we going t o do about onboarding?? A really regular lament, this one. New recruits are coming into a much-altered business, and can?t expect the same sort of high touch induction experience now as previously. Interestingly though, Covid may just have hurried along change in this area as this is a topic that has been bubbling away for a while. Can we digitally pre-board people? Induct them via e-classrooms and video-based modules? Support their physical introduction with app-based maps and guidance? Survey feelings and sentiment and deliver e-mentorship?

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T h e T r u e Cr eator O f I n ven ti on I s N ecessi ty Laura D over, H arrison D rury Solicitors Stephen Pritchard, M atrix247 ?Leave me where I am?, was the underlying message received back from our people after the first two months of ?lock-down?after Covid-19 struck. This message was not so much around their concern of ensuring isolation and health protection but as a direct response to what necessity had enforced in collaborative working from home. Laura Dover, Operations Director at Harrison Drury explains that as a mid-size, multi-discipline law firm with over 120 employees across Lancashire & Cumbria, the challenge is how we look to return to the world after-Covid19 as it has become evidently clear that homeworking has had a positive impact on efficiency and has provided the balance sought by many of our people. A big influencing factor has been the reduction in travel time. Travel that historically was done as part of a commute to and from the office, meeting with clients and inter-branch to meet with colleagues across all departments.

Trust ? As there have never been problems with trust in our people across the firm, discussions between the heads of departments and the board have clearly spelled out the many benefits that can be derived from a well-thought-out strategy for our people, our clients and our business. The necessity of the recent changes bestowed upon the firm has helped us to achieve agile working across the business sooner than we may have previously anticipated.

Building a St rat egy We see the return to ?normality?as a two-phase process. The first is a pre-vaccine precautionary manoeuvre due to social distancing. Following the Covid19 safe standard code, seating plans have been revised to ensure social distancing for those wanting to spend time in the office.

St aff Rot as Rota-based working is being considered to ensure we can make it possible to offer the blend of office and home-based working. Whilst many businesses are looking at remote working as an opportunity to save money on-premises costs, we believe that it will be difficult to do this during ?Phase One?.

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Whilst we have fewer staff in our offices, we are committed to following the Covid-19 secure 2m social distancing guidance and recognise the limitations placed on desk-sharing until a vaccine is made available. A second phase of development will start after social distancing has ended and a vaccine has been developed. Harrison Drury will review how the rota-based system has operated for the firm. We will look to understand from each department head and members of their teams what has worked well and the lessons learnt to help inform a long-term homeworking policy. Considering both productivity and what positives coming out of working in a more flexible and agile manner, whilst ensuring the culture of the firm is maintained.

How t o faciliat e plans from a communicat ions perspect ive Stephen Pritchard CEO of Matrix247, the telecoms & mobile provider to Harrison Drury goes on to outline, ?The ability is available to Harrison Drury to implement remote working and eventually ?hot-desking? through their cloud-based telephony system. Harrison Drury are hoping this capability will enable the firm to offer agile working across their business and realize many of the benefits this can provide for their people, their clients and their business. Enabling the firm to both expand headcount without taking on additional premise costs and, for some locations, to potentially reduce floor space rental costs.? Stephen adds ?Directors, Solicitors and those working in business support roles at Harrison Drury are avidly using the collaboration suite of desktop tools such as video-conferencing that is fully integrated into the cloud-based telephony platform. The feedback from a number of heads of department is that productivity is clearly unaffected, and in some cases increasing. Should this prove to be the permanent change indicated, the amount of time saved in car journeys together with notable drops in fuel costs during the Covid19 crisis will hopefully remain significant benefits for the firm?.

"I t's ev i d en tly cl ear th at h om ew or k i n g h as h ad a p osti ve i m p act on ef f i ci en cy... "

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A Bu m p I n T h e Road ? Patricia Kinahan, H azelwoods Since 23rd March 2020, we have probably seen the most challenging time in anyone?s career in terms of how to manage a business. There is no textbook that one can refer to on how to get through this and we have had to rely on our own skills and expertise, and those around us, to help. It probably feels in some ways that the hard work has now been done, as there are glimmers of hope that things are starting to pick up with the opening of the housing market, social distancing rules being relaxed more and more, and businesses starting to re-open.

From a finance perspective, the only real Government support that law firms have seen, is the furlough scheme which has softened the short-term impact of COVID-19. All other support from the Government has really been about deferring financial issues until another day in respect of VAT, PAYE and income tax payments.

On the face of it, a lot of firms? finances are probably currently in better shape than anyone could have predicted at the beginning of this pandemic. Most firms have more cash than expected due to the deferment arrangements, furloughing and the encouragement for fee earners to bill as much as possible and clear out work in progress. However, behind the scenes, with the clear down of work in progress, what is happening is that as activity levels reduce, that work in progress is not being replaced at the same rate.

Just when you are thinking that you are back on track, the reality is that there is a potential large bump in the road on the way to recovery, and this is going to happen in quarter one of the calendar year 2021.

The reason for this is that all of the deferment offers by the Government, which most firms took, will crystalise in that quarter. This is the VAT payment up to July 2020 and for many, this VAT payment will be exceptionally large in comparison to perhaps what firms are paying at the moment, as it was a very busy quarter, and it will also happen at a similar time to another VAT quarter, so effectively paying six months? worth of VAT in one go. In addition, there will also be three tax payments to make, being the second payment on account for 2019/20 which is normally payable on 31 July 2020, the sweep-up payment for the set of accounts falling in the tax year ended 5 April 2020, and the first payment on account for the set of accounts falling in the tax year ending 5 April 2021. 17 | CALICOLEGALGROUP.CO.UK

For practices that have a year end other than March, the second payment on account and sweep-up payment is potentially for a very good year, i.e. April, May or June 2019. Having a year end which does not coincide with the tax year, is great when business is brisk and money can be put aside for that and invariably used as part of the business? working capital. However, when activity levels reduce after such a good year, the temptation is to use the cash generated from those profits to help the business, which then unfortunately means it is not available then to pay the tax when it becomes due.

Forecast , forecast and re-forecast Most practices have done short-term forecasting, such as the rolling thirteen week forecasts already, to help them through the initial phase, which has been incredibly helpful. That newly formed habit (for some) must continue but must be pushed out on a rolling twelve month basis. With life changing so quickly, re-forecasting as a bare minimum on a quarterly basis is now required as more information comes to light. Test your forecast s

There are many things that a firm can look at, to help in relation to their tax payments due at the end of January 2021. It just means speaking to your accountant and planning in advance.

It is so difficult to predict what may happen in terms of activity levels across so many different areas of law. However, you should always test your forecasts by applying a level of sensitivity. A good rule of thumb is a reduction of income of 20% to see what the impact is and therefore you can be ready to make decisions when you start to see this decline.

No doubt, with so many businesses in a similar situation, the Government will probably offer some form of ?time to pay? arrangements, but one should not rely on this as a guaranteed way of dealing with it.

Carefully monit or people ret urning from t he furlough scheme

The main issue that a firm needs to focus on is the balance of the rebuilding of work in progress and how quickly that can be converted into cash versus the cost of creating it. One of the challenging issues of managing working capital at the moment is that matters are taking longer to complete and therefore the working capital cycle is being extended which invariably means cash generation will be delayed but in the meantime the costs of creating that work in progress will quickly eat into cash that a practice has. The ability to balance this will determine how well a practice deals with the bump in the road.

In addition to this, your clients will also be looking at that first quarter of 2021 and making plans of how to manage their own cashflow. No doubt you would have seen from the initial phase of the pandemic, a slowing down of cash collection, particularly for those firms that have commercial clients, as everyone wanted to preserve cash. This will happen again in the first quarter of 2021 and may in fact start to happen towards the end of the 2020 calendar year as businesses start to prepare for it. Using your creditors as part of helping you with your working capital cycle is a common practice for many businesses, but you do not want to be on the end of it!

What can you do? In order to try and smooth out the bump that is coming down the road, there are a number of actions you can take now and continue with throughout the next twelve months:-

It is easy to say one is busy but the definition of busy has to meet the level of contributions an individual/team is making to the business. Un-furloughing a person too early who is not going to build up sufficient billing, is going to be an expensive process. Un-furloughing too late and you may find that there is too much work for other people creating moral issue (which can be harder to detect when individuals are working more remotely), so it is a fine line to draw. This is where looking at daily/weekly chargeable time is an important management tool to gauge what action businesses should take. Remain flexible Furlough has helped in the short-term but it will be coming to an end completely at the end of October. There has to be alternative measures, such as reduced working hours, pay cuts or a continuation of pay cuts, as many have happened already etc. This may apply across the whole firm or it may apply in different departments, the most important thing is to match activity level with demand so that you can manage the cost of producing the work in the most efficient way.

To conclude, there's a famous phrase of ?forewarned is forearmed?. This bump in the road is going to happen and it is better to be aware of it and plan for it as opposed to it becoming a sudden, unexpected surprise. If COVID-19 has taught us one thing, it is the ability to remain flexible at all time as things are changing considerably and the best practices are those that are prepared to change when required.

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M en tal H eal th & T h e Pr of essi on Nicolas O'Neill, Lawcare Champion, W irral Borough Council Covid exhaustion. This was a phrase used by my coach when describing how many of his clients have presented over the last few weeks. No obvious symptoms but convinced that they retained some underlying ailment, undeniably linked to Covid-19. Aches and pains, exhaustion, viral-like symptoms, lack of sleep, apathy, the list went on and on. The only real common denominator being that they all retained high pressured jobs, where competition, status, ego, targets all played a key role in their profession.

Is t his ringing any bells? The legal profession already retains undeniable levels of pressure, with a myriad of differing drivers. Throw both Covid-19 and isolation into the mix and you have the perfect storm for lawyers (or anyone for that matter) who are susceptible to stress, anxiety, depression or any other mental illness.

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W hy now? But suddenly, as if by magic, mental health is no longer a taboo topic We find ourselves drowning in an abundance of tips around mindfulness, yoga, coping strategies and offers of mental wellbeing resources at every turn.

Whilst I appreciate that firms are making such tools and resources available, I find myself asking the question; why now?

It is not as if our profession is a stress-free environment. According to the Junior Lawyers 2019 survey, over 90% of junior lawyers reported negative stress as a result of work. The truth of the matter is that we as lawyers predominantly exist in a culture where mental wellbeing remains a topic that, whilst slightly more acceptable as facet of our professional health, is still perceived to be a character weakness.

The message being: If you struggle with mental health issues, you will struggle in the legal profession.

The answer as to why lawyers are all suddenly more accepting of the importance of mental health is possibly twofold.

We are metaphorically in the ?same boat? as everyone else and if everyone else is talking about mental health, then why can?t we? There is constant talk about this being a turning point for society and that we will be living in a new reality when the pandemic subsides.

If this is the case, then with mental health being at the forefront of our discussions, is this not a time for the legal profession to take a hard look in the mirror and accept the fact that mental health is of paramount importance for our people? Not just in terms of their wellbeing but in terms of their productivity.

If you create a culture where mental health is discussed as an acceptable societal norm, then you remove the stigma attached to the conversation.

We have all experienced moments of uncertainty during the pandemic, from doubts of self-worth to fears for our own physical health and that of our loved ones. Mental health is ?health?, and this has been a clear message from the greater society during the Covid-19 crisis. Mental wellbeing is front and centre as a topic of conversation daily. Intrinsically linked to the balance between physical health and the benefits that that brings. So, my quest ion t o our profession is t his:

First ly, we are struggling with an unprecedented challenge. The Covid-19 crisis lockdown has been compared to wartime restrictions, but many pensioners will tell you that it is actually worse, in that at least in wartime they could go about their business relatively unhindered.

Secondly, we find ourselves isolated from the competitive environment of suits and offices. We sit at home and the pressure of ?image? is no longer a facet of our daily existence.

?If mental health is an acceptable conversation now, then shouldn?t it be one of the discussions that we should be having now, in preparation for our return to the office??

By ?conversation? I don?t mean a management tick box exercise. It must be a conversation with full buy-in from top to bottom, as only then will we see the change that our profession?s people deserve. So, thank you Covid-19 for giving us the opportunity to talk about our mental health. It often takes a crisis to wake us lawyers up.

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"O ver th e l ast 20 y ear s or so, a st ead y r evol u t i on h as been tak i n g p l ace"

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W h y a V i r tu al Fi n an ce D i r ector M akes Sen se Richard Wyatt, Baskerville D rummond This article would have resonated strongly even before we were hit by coronavirus but given the importance of resilience strategies and financial planning as we head through the restart and recovery phase, then it should land with even greater impact. Perhaps firm size has never warranted a full-time finance director or maybe anticipated changes to our way of working may call time on established full-time positions in favour of outsourced advice. But advice you will most definitely need ? can a virtual FD really fill that advisory gap? Over the last 20 years or so, a steady revolution has been taking place in the employment market, which has led to fewer firms employing full-time specialists to lead their business support roles. IT, HR, facilities, business development, accounting, procurement and so on, have gradually been outsourced and/or engaged on a part-time basis and there is no sign that this trend is going to reduce soon. The logic is as follows. You need someone for their high-level expertise and abilities and you need them for their strategic input and ability to develop the business. That piece is invaluable, so without considering the options, firms employ someone full-time at director level whilst forgetting that there will be times when you don?t need that level of skill and expertise. So, you are buying someone?s time when you don?t need it. Firms don?t need that strategic input and skillset on a permanent basis, day in, day out. Perhaps that higher-level expertise is rather required just a day a week or a couple of days a month. However, they have employed the people full-time, so what are they asked to do, (or what do you let them do, if you don?t direct them closely)? Typically, we ask that person to undertake more routine tasks and therefore we are now asking them to undertake tasks that do

not need a highly paid director-level appointment. They can - and should - be fulfilled by cheaper, manager-level or supervisor-level staff. Firms are therefore asking expensive people to do the work of a cheaper staff member. How does that make sense and shouldn?t the firm target the work required by having the right level of person doing it? It?s the same argument for having the right person doing the legal work. No well-run and efficient firm would expect a straightforward residential conveyance or compromise agreement or personal injury claim to be undertaken at partner level. So, why would you have an IT director manning the helpdesk, the facilities director loading the photocopier or an HR director loading data for new starters? It does not make business sense. The question you might then ask is, ?Well, what should they do?? That question shows that you are still thinking of employing them full-time. You need not. You only need to employ them for the time you need their higher-level skills and expertise. The rest of the time, they can work elsewhere or not at all, if that?s what they choose: but at least you are only paying for the bits of their skills and expertise that you need and only when you need them.

This model is already quite well established in Human Resources, where part-time HR managers and directors are engaged by law firms. There are many external HR consultants offering their services and the number of days work is tailored to what the firm needs. The outsourced model exists in facilities, with many firms in multi-occupancy buildings, sharing common areas, coffee bars and restaurants. It is only when you want to renegotiate the lease or licence ? or heaven forbid ? have a serious issue with the building that you liaise with the director-level staff.

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IT outsourcing is now common, with hardware off-site and backed up at one or more further sites. Software is updated remotely and managed by the outsourcing business: similarly, with telephones. Much of the routine work does not require director-level input. You need a director to think about what you need and to obtain it, to manage the project and ensure the outsourcing firm is abiding by its Service Level Agreements. Businesses supplying part-time HR, IT, marketing and similar business support functions have grown over the last 20 years as firms see the sense in tailoring what they pay to what they need. How does t his apply t o finance? There are now several firms providing part-time FDs, as well as those providing financial controllers; and others providing a full accounting service, including specialists for law firms, such as The Cashroom that operate a fully outsourced accounting service, including client accounting. By saving on the salaries, plus on-costs, of your finance team and substituting that cost with an outsourced part-time finance director and outsourced finance team, costs can be tailored to match the demands placed upon the firm. You don?t have the difficulties of having an employee-employer relationship. You can have greater flexibility if you need it: but equally, just as with an employed person, if you find that the finance director continues to contribute, you can keep using them on a part-time basis for as long as you both find the relationship works. More recently, this slow revolution has morphed into an increased use of virtual finance directors. While more and more firms are seeing the advantages of part-time directors, more and more are realising that the finance director need not be on-site all the time, need not have a firm?s laptop, desk space and such like. Firms have taken them on for the advice they offer, not the coffee they drink at meetings. Much of what they do can be done remotely and the massive increase in the use of remote working during the Covid-19 lockdown has demonstrated that it works well. The technology is available, such that the finance director has access to the data for the firm and can often put in more time than normal into their day?s work. There is less commuting, and the access is 24/7. 23 | CALICOLEGALGROUP.CO.UK

T h e I m p act O f Cov i d : W h at W e've Seen So Far I n PI I Brian Boehmer, Lockton Prior to the Coivd-19 pandemic, the insurance marketplace showed signs of ?hardening?, which means placing solicitors? business with insurers has become increasingly difficult and potentially more expensive. As a result of these changing conditions, many law firms were required to supply additional information to Insurers beyond the standard proposal form. For quite an extensive period of time, practices have been able to conduct their renewals on a very straightforward basis, with many Insurers offering ?quick? or ?early renewals?, whereby practices are required to provide very limited information. Whilst this still continues, the volume of practices these types of renewals are offered to have significantly reduced, with many Insurers in the October 2019 and April 2020 renewal periods asking for increased supporting information before they would consider to offer any terms.

The increased popularity of working from home or reduced working weeks has meant fragmented workforces, well before the pandemic, where employees saw balance, Insurers saw an increased risk, therefore a heightened requirement from Insurers to know what measures are in place to enhance supervision, governance and oversight. Insurers have always been concerned with law firm supervision and oversight within a practice but now many of us find ourselves in a new and very different working environment, with some key members being perhaps furloughed this has heightened further. As a result, we anticipate that the Covid-19 pandemic will result in an increase in even more information being requested. Insurers naturally wish to align themselves with good businesses and will be asking more questions to help them identify those practices with robust business models, who can weather the current storm. Practices should expect to provide detail on operational processes and working from home capabilities. This will naturally include an overview of the supervision and governance that is in place. CALICOLEGALGROUP.CO.UK | 24

W hilst quest ions will nat urally evolve, our init ial observat ions of areas t o address include: -

We would encourage practices to articulate how they are ensuring that the quality of work remains first class. What measures have been implemented to ensure that deadlines are not missed and things that need to be done timeously are completed on time? How accessible is the entirety of a client?s file? - Therefore ensuring that fee earnings can see the full picture when providing clients with advice? Expect greater scrutiny on the financial position, this is likely to include providing full details of measures taken to protect the long term viability of the practice, e.g. loans, the volume of staff furloughed and any alternative future plans. What, if any, new processes are being deployed in respect to Client Account/ transactional protection and how is your practice protecting your clients?money (and the insurers?balance sheet)

Whilst Insurers will want to know what steps practices have taken, we also expect them to be neutral and if practices have taken steps it will not viewed negatively, they will need to evidence an understanding of the rationale behind decisions made.

Addit ional considerat ions: Understandably, many firms will be faced with the burden of keeping fees as stable as possible and in turn, some solicitors may decide that one method to increase fee income is to offer clients and prospective clients legal services in areas of law in which they haven't previously practiced. However, dabbling in new areas of work can be detrimental to your practice in the long term. Acting on the odd bit of 'other' work that you do not have expertise in is not a risk worth taking. The potential lasting effects of dabbling can be disgruntled clients, claims and subsequently increases in your insurance premium; the downside of these far outweigh what might be earned from doing this work. If your firm is looking to offer a new area of law Insurers will want to be confident in your expertise and importantly what type of clients you are doing this work for.

3 St eps t o help Navigat e t he challenges ahead:

1. Firstly, we recommend to start your insurance renewal as early as possible. The insurance market conditions are expected to be increasingly challenging, with many Insurers already feeling the immediate impact of loss in relation to COVID19. 2. Prepare a quality presentation - the quality of your renewal presentation can differentiate your firm from the crowd. Any prudent Underwriter will naturally be adopting caution and it is important to remember that you will be vying for their attention with a plethora of practices, a detailed presentation will mean that you will be starting on the front foot and Insurers may well be more accommodating. 3. Lastly but of equal importance is the selection of your representative will need careful consideration, do not approach multiple agents that overlap with Insurers. Establish who they can approach direct ly before you provide them with your information, some may scatter gun the enquiry which could put you in a difficult position. Agree on a timeline including deadlines for the presenting options way before your impending renewal date.

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YO U R EX PERT S

MARTYN BEST, Document Direct Chartered Accountant, entrepreneur and developer of a number of varied businesses, Martyn created Document Direct to offer law firms the opportunity to improve their profitability and take advantage of the changing landscape of the internet and the challenges of being a law firm in the 21st? century. He?s also a cyclist and a Tranmere Rovers Associate Director.

MARTIN LANGAN, Legal Workflow Martin is a solicitor with vast experience in private practice, who is nationally knownfor work with legal technology. He has expertise in writing bespoke case workflows for clients of most of the UK legal software companies. He advises firms on IT strategies, business process improvement and PMS selection, and is trail blazing innovative online legal services.

NICOLAS O'NEILL, LawCare Champion Nicolas is Governance and Legal Practice Manager with Wirral Borough Council. He is also an Open University Business School student mentor, chair of the Wirral Borough Council?s Men?s Health Group and a LawCare champion.

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PATRICIA KINAHAN, Hazlewoods Patricia's experience is built upon 20 years of working with and helping all types of law firms with compliance and strategic matters. She offers her clients a focus on and a depth of expertise to improve business performance and conduct effective tax planning for the future.

STE PRITCHARD, Mat rix247 Stephen created a legal division 12 years ago?designed to maximise fee earners time,?assist?with risk and security management principals?and?share ideas adopted by over 100 existing legal clients to?enhance the client experience? customers receive along with legal-tech solutions in reducing unnecessary and unsustainable operating costs?through the very latest advice in Telecomms, Mobile Comms and Data Comms.

BRIAN BOEHMER, Lockt on Brian is a Partner at Lockton specialising in Professional Indemnity Insurance. Brian has a particular focus on the Insurance and risk requirements of the Legal Profession of England and Wales. In addition to managing a portfolio of clients, Brian plays a leading role in negotiations with insurers.?Brian manages a number of our affinity group relationships and has a wealth of experience in structuring and administrating group insurance solutions.

RICHARD W YATT

PHIL W EDGW OOD Engage Solut ions Group

Baskerville Drummond Consult ing Richard is long-time Law Society lecturer and experienced law firm finance director for Tollers in Northampton, Piper Smith Watton in Westminster, and Greenwoods GRM in Cambridge and London.

Phil Wedgwood is the CEO of the UK?s foremost engagement specialist Engage Solutions Group. He has managed and overseen the development of a number of leading-edge technology companies, such as Rekoop and latterly Intapp. Phil is now championing a mobile-first approach to both employee and client engagement as part of firms' broader digital transformation efforts.

ALEX HOLT The Cashroom Alex is a qualified solicitor who became a partner in a national law firm before founding a recruitment business servicing the legal sector. Alex joined The Cashroom in 2014 having spent 4 years heading up business development for an international outsourcing company in the legal sector.

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