Back when I worked at the large law firms, I had my own way of recording my time and it wasn’t necessarily contemporaneous with the activities that I was engaging in. I was really careful about the time that I put into the system. I wanted to avoid big write-offs, that the partners who were managing me might feel compelled to put into my time entries. And so there was a lot of politics. It was a lot more complicated. And so I would sometimes ride the train the day after and go recreate my time and make sure that it was written up in a way that made sense to me. And I think that it worked for me when I was at the large law firm book. Man, I would not do anything like that right now. The religion of my law firm, and it has worked out great, is that we record time when we are doing the work and we have excellent time descriptions.

I’ve got a standard operating procedure about the five different elements of an excellent time entry that are going to demonstrate value. I think it is absolutely a key to the fact that I’ve collected on 99% of the dollars that I’ve invoiced from the moment that I started my firm until now. It is very rare that I send an invoice that doesn’t get paid. One of the other things that I am absolutely committed to is I invoice on the first of the month, unless I’m invoicing more frequently. I mean, the default for 95% of my clients is you are getting an invoice from me on the first of the month. I don’t care what day of the year it is. I was sitting on the beach in Florida on New Year’s Day about five weeks ago invoicing because New Year’s Day happened to fall in the first of the month that year.

It is the religion of my firm that time gets entered when people do the work, excellent time entries, and we always invoice on the first of the month. I think that there’s a professionalism that clients sense if they don’t get an invoice on the seventh day of the month, if it’s every day like clockwork on the first of the month, I think that it lets them know that you’re serious about billing, you’re serious about collection, that you’re running a professional organization, that you are committed to systems and processes. And so I am completely unflexible when it comes to deferring invoicing, but I am totally committed to writing off any time that I need to to make sure that my clients feel like they have value. I pay the lawyers in my firm a fixed salary. Yes, they do get performance bonuses, but however many hours they bill on any given day are not going to dictate their compensation.

And this is something that is a little bit different than the owners of a lot of small law firms. I always felt like I wanted to be able to freely write off any time off an invoice that I thought was appropriate. And I didn’t ever want a attorney to feel like their compensation was directly tied to my decision because I didn’t want to be in the horns of the dilemma of having to either bill a client more than I thought was appropriate or making a lawyer feel like I was taking money out of their pocket. And so when I do my invoicing, I liberally write off probably about 20% of the time that we record, I show it right there on the bill. So you could see the hours that I charged for the hours I didn’t charge for. And I think that the optics of having great time entries, liberally writing off time, having clients see what time is written off and what time is being invoiced and having those really good time entries.

I think that when people receive invoices from me, even if they’re larger than they want, 99.9% of the time, they’re going to get paid without any complaint because there’s no question about the work that we did and there’s no question about the value that we created because it’s all right there on the face of the document. And so I would record time contemporaneously. I would always invoice on the first of the month and I would show the clients the time that you write off. I wouldn’t disappear it off the bill, put it right there for them to see. I can’t guarantee that that is going to cause 99% of your invoices to be paid, but it’s worked for me.