Practice Management

John Jantsch at Duct Tape Marketing has a great post on what is the perfect referral motivation.  Although his post speaks to a market larger than the practice of law, I have found what he states to be particular true as to referral or network marketing in the practice of law.

John's point is that money or compensation really is not the chief motivating factor as to why people (in this case lawyers and those who refer to lawyers) refer cases.  The motivation comes from an "deep seated human need of community", namely that people take great pleasure in helping others out.  It enhances their credibility to be a reliable source of information and help.

As it concerns non-lawyers, it is illegal to share profits or legal fees, in most all states and jurisdiction, with non-lawyers.  So, as a source of motivation for a non-lawyer referring you work, money and compensation is already off the table.

Second, as to lawyer referrals to other lawyers, some laws like the Bankruptcy Code prohibit fee sharing without prior disclosure and permission from the Court.  Some states restrict the amount of money paid.  Some states or jurisdictions restrict the sharing of fees unless the referring lawyer has done actual substantive work on a case.  Therefore, you have to be especially careful and vigilant anyway not to run afoul of the law even when dealing with other lawyers.

The best way is just not to make the payment of fees and compensation the center point of you referral marketing efforts.  In my experience, lawyers and others who refer work most often do not do the work you do or they have some conflict, and really want to be helpful, want the client out of their office without hard feelings, or both.  Therefore, these lawyers need to do what you do and how you can help these people.

In my experience lawyers and others that are primarily motivated with the money you will pay them typically turnout to be not so good referral sources.  They are moody.  They shift their allegiances easily.  And, they ship all kinds of crappy cases over to you without any consideration as to whether the matter really falls in your bailiwick.  They are not motivated to help someone as they are looking at you as a revenue stream.   I guess my point is that referral relationships based  primarily on money are generally not pleasant.

I think that this statement by John Jantsch is correct:

When referral sources are motivated, intentionally or unintentionally, out of a desire to help, they will often go to great lengths to do so. On the other hand, when the motivation is monetary, they will view it as market transaction and the motivation is often significantly lower or certainly different - ranging from indifference to distaste depending upon the industry.