Best Practice: Law firm strategic plan vs. business plan

Asked and Answered By John W. Olmstead, MBA, Ph.D, CMC Q. I am the firm administrator in our firm. We have 24 attorneys and are just transitioning to the 2nd generation of partners. I have been charged with obtaining information on strategic/business planning. Currently the firm does not have a strategic or business plan. What is the difference between a strategic plan vs. a business plan? Do you have a recommendation as to whether we should consider implementing a business plan or a strategic plan? A. Often the term strategic plan and business plan are used to mean the same thing. The general planning process is similar. However, I believe there is a difference. I consider a business plan to be the primary tool of choice when starting a new business or venture. Typically the audience is external - bankers, investors, prospective partners, etc. Due to the external nature of the audience the business plan document needs to be detailed with supporting narrative, company history, market analysis, marketing strategies, personnel plan, management biographies, and pro-forma financial statements. A strategic plan is typically the tool of choice for a going concern business or firm - such as an existing law firm such as yours. The intended audience is internal and its primary purpose is to focus the efforts of firm members and employees. Much less narrative and supporting detail is required. A strategic plan uses more of an outline format with bullet points and much less narrative and supporting detail. A strategic plan in small firms is often 10 pages or less and consists of the following sections"

• Mission Statement
• Vision Statement
• Long Range Goals Statement
• Objectives (Measureable) Years 1-5
• SWOT (Internal Firm Strengths and Weaknesses - External Opportunities and Threats)
• Key Issues
• Strategies
• Action Plans and Timelines (Milestones)

The key is to keep it simple and develop a plan that will actually get used, focus the firm's efforts, and hold specific people accountable. I believe that what gets planned - what gets measured - is what gets done. Click here for our blog on law firm strategy Click here for articles on other topics John W. Olmstead, MBA, Ph.D, CMC, (www.olmsteadassoc.com) is a past chair and member of the ISBA Standing Committee on Law Office Management and Economics. For more information on law office management please direct questions to the ISBA listserver, which John and other committee members review, or view archived copies of The Bottom Line Newsletters. Contact John at jolmstead@olmsteadassoc.com.