Changing the Business Owners Relationship With Their Lawyers with Romesh Hettiarachchi | E058
Changing the model of billing and value delivery in law.
In this episode of Financial Planning for Canadian Business Owners, Jason Pereira, award-winning financial planner, university lecturer, and writer, interviews Romesh Hettiarachchi, Commercial Lawyer at B&I Legal Counsel for small to medium size businesses in the Greater Toronto Area. Today’s discussion addresses the various ways that Romesh charges and interacts with his clients, and how that change in compensation has led to very positive outcomes for his client relationships.
Episode Highlights:
● 01:07 – Romesh Hettiarachchi describes the kind of work he does.
● 02:31 – How has Romesh addressed the concerns of clients afraid of lawyers costing too much business lawyers are often incentivized to take longer.
● 03:55 – What are the four schools of thought on how to use a lawyer?
● 06:57 – Jason shares a story about a wealthy individual that used the managerial approach of hiring a lawyer.
● 07:32 – Build a team as a foundation for your enterprise.
● 10:15 – How has delegation and resources entered into his practice?
● 14:13 – Lawyers, and service providers in general, are hired to solve problems, minimize risk, manage process.
● 16:27 – Why are many lawyers afraid of change?
● 20:00 – What are the five issues that lawyers generally face?
● 21:26 – Why isn’t there a program for lawyers that want to challenge the status quo?
● 23:30 – The only way to fight margin compression is through efficiency.
● 24:04 – There is a cost of risk with people.
● 27:19 – Unconscious incompetence is a value proposition to help client via building stronger relationships with them.
● 30:00 – Watching clients succeed and win is truly rewarding.
● 32:00 – Clients want their problems solved for a price that they can pay.
3 Key Points
1. Four stages of using a lawyer: to fix problems as they arise, to manage what you don’t know, to minimize risk, and to be a strategic advisor.
2. Building a team involves the art of delegating tasks not just to people, but also to technology to provide value to clients.
3. The five issues that lawyers in general face are: increased competition, clients that want more value for less money, trying to outcompete technology, keeping a work/life balance, and mental health and loneliness.
Tweetable Quotes:
● “Clients really want more out of their lawyer than simply drafting contracts.” – Romesh Hettiarachchi
● “When I see the value of a lawyer to a client. It is really three-fold. One, we are either solving problems, minimizing risk, and lastly, we manage the process. Very good lawyers will do all three of them.” – Romesh Hettiarachchi
● “In my experience, and from everything that I have read, and from the people that I have been around, the most successful people are the people that are able to build teams that work together for everyone’s success.” – Romesh Hettiarachchi
Resources Mentioned:
● Facebook – Jason Pereira’s Facebook
● LinkedIn – Jason Pereira’s LinkedIn
● Woodgate.com – Sponsor
● LinkedIn – Jason Pereira’s LinkedIn
● FintechImpact.co – Website for Fintech Impact
● jasonpereira.ca – Jason Pereira’s Website
● bilawyers.ca – Website for Romesh Hettiarachchi at B&I Legal Counsel
● Linkedin – Romesh Hettiarachchi’s Linkedin
Transcript:
Producer: Welcome to the Financial Planning for Canadian Business Owners Podcast. You will hear about industry insights with award-winning financial planner and entrepreneur, Jason Pereira. Through the interviews with different experts, with their stories and advice, you will learn how you can navigate the challenges of being an entrepreneur, plan for success and make the most of your business and life. And now your host, Jason Pereira.
Jason Pereira: Hello and welcome. Today on the show, I have Romesh Hettiarachchi, commercial lawyer at B&I. I brought Romesh on the show specifically today to talk about the very different model he's adopted for how he charges and interacts with his clients and how that change in compensation and billing has actually resulted in a very different and very benevolent, or a very different and very positive outcome for how all his client relationships are turning out. And with that, here's my interview with Romesh. Romesh, thanks for taking the time today.
Romesh Hettiarachchi: Jason, it's a pleasure to be here. Thanks for the opportunity.
Jason Pereira: My pleasure. Romesh, tell us a little bit about what you do.
Romesh Hettiarachchi: Yeah, I'm a commercial lawyer. I'm at a small law firm in the West of the city, west of Toronto. And I've been running this practice for about three years built on this idea of providing proactive advice to more modern business owners and entrepreneurs. I started developing this model after about seven years of practice when I realized that clients really want more out of their lawyer than simply drafting contracts. So I've been working on this model over the past three years and it's been something that I think has value and I'd love to share what I've learned.
Jason Pereira: So basically the traditional model with a lawyer, as I always say, is you hope to never have to call them. There's certain things that we absolutely are going to need lawyers for. We need a contract to set up a company, all this other stuff. Well, maybe some of these cases. But if you're going to do it right, you could go to a lawyer.
Jason Pereira: And of course there's a, we'll just say, confrontational or adversarial approach there in the first place because clients are universally worried about what a lawyer is going to cost. They hear lawyer and they think lots of money. And you're [crosstalk 00:02:11].
Romesh Hettiarachchi: [crosstalk 00:02:11].
Jason Pereira: Exactly. You're almost an adversarial position here because the lawyer is incentivized to spend as much time on a case as possible, the client doesn't want you to spend that much time on a case as possible. Price becomes a conflict point towards service. So talk to me about how you feel about that view of the world and how it is you have tried to kind of flip that model.
Romesh Hettiarachchi: Sure. So let's start off with what you just hit on. I think that for the longest time, the majority of the legal professional, the traditional legal professional, has seen their value as simply being exchanging time for money. And we call it what's called a billable hour. Jason, you're absolutely right. What that means is that there are really conflicting incentives. There's no incentive for the lawyer to accomplish the same amount of work in less time because that would mean the lawyer is paid less.
Romesh Hettiarachchi: This is written about endlessly, right? I remember talking about this when I was in law school almost a decade ago. What I started to come to realize is that this is a problem that needs to be re-imagined and re-explored. Over time and over the past three years, the way when I see a lawyer, when I see the value of a lawyer to a client, it's really threefold. One, we're either solving problems by minimizing risks and lastly, we're managing process. Very good lawyers will do all three of them. If your lawyer is not doing any of them, then you're probably not getting a lot of value from them.
Romesh Hettiarachchi: And that was really my starting point to think about how can clients use and generate more value from a lawyer, more effective and efficiently. That led me to this idea of the difference between reactive lawyering and proactive learning. Let me just break this down for you. This comes back to the four ways I think about when how to use a lawyer, right? There's a first school of thought about using a lawyer and that's usually as sort of like a paramedic, right? A lawyer is costly, a law doesn't provide value. I'm not going to talk to them. I'm not going to talk to them unless I'm in a I'm in trouble. It doesn't make sense. A hundred percent it's a triaged model is something went wrong. Exactly.
Romesh Hettiarachchi: Second type of model is this idea of the lawyer as a manager. And that again is coming back down to the idea that the owners of talking to a lawyer is placed on the client. So a client says I'm hiring the employee. I need to talk to a lawyer to draft an employment contract, that type of thing. Right? So the onus on the client to identify when they talk to lawyer again, it's still reactive, the reactive approach to using the lawyer.
Jason Pereira: It's a self-managed approach. It's basically I have to fight. I have defined that I need a client. I, I am the one who determined that. So you're dealing with the... You have to be in your zone of conscious incompetence, right? You have to know that you don't know, right? You have to know that I need something beyond what I'm capable of doing.
Romesh Hettiarachchi: That's exactly it. And like I said, I'm interested in the last two schools of thought, which is basically the lawyer as kind of like a lifeguard to identify and address and minimize risk. And the last stage of the last school of thought, being the lawyer as being a sort of strategic advisor. So a lawyer that's actively working to actually increase the profitability of your business. And that's really what I'm focusing on, building my legal practice around the idea of a lawyer of the value of having an ongoing relationship with your lawyer to either identify and address risk. So a risk mitigation approach, as well as the idea for lawyer as a revenue generation opportunity, the lawyer can come in and advise you here are some of the ways to generate more money.
Jason Pereira: Going back to my previous statement about like the previous model being conscious incompetence. I know that I need to do something a lot, lawyer's got to do it, but I don't know what needs to be done so therefore I need a lawyer. You go to the light guard approach, it's basically the unconscious incompetence, you are solving for that problem. They don't know what's wrong in their practice. Basically, they think they're running it all fine, and they don't know what's wrong in their practice because they're not educated to look for these things, right? And the last one, as you said again, the strategic partner, which is essentially your part of their team, you're a fractional chief legal officer. But for the record, and those of you listening to this podcast, listened to me for a long time, I mean, you're no doubt hearing a message you've heard before.
Jason Pereira: And this is one of the reasons why we were like, "Oh boy, this is a meeting of like-minds. Again, this is the same exact messaging in my industry. The reality is, is people will say, "Well, what value can you bring to the table?" My response is, "I don't know, because I haven't gotten up in your business yet," right? Until I actually know what's going on in your life, I don't know if you've done everything right. Well, I've done everything right. How can you say that when you don't know? You don't have the practitioner's level of knowledge of something. You can't know that you don't have all these blind spots, and it happens all the time.
Jason Pereira: And just to share a quick story, I met a very, very wealthy individual and he was very successful and clearly someone who just kind of views the triage approach, right, the managerial approach. I need to do this, I need to do that, had this massive complex situation. And within about a 20 minute phone call, I identified several large scale fundamental structural problems in their arrangement that was going to result in untold tax burden. And it was again, he thought he was doing everything right because he was managing it, but he didn't have the lifeguard or the partner.
Romesh Hettiarachchi: And I mean I come across this so many times and I really advocate for my class to build teams. There's one school of thought that you've got to build success all by itself. And there may be individuals who can be the self-sufficient type of idea, but in my experience, and from everything that I've read and from the people that have been around, the most successful people are the people that are able to build teams that work together for everyone's success. So I always tell clients there's value in having a good account, having a relationship with account on an ongoing basis, having an initiative with a developer or designer on an ongoing basis. Obviously, these types of approaches are not right for every business, but when you're building out a team, you're building out a foundation for your enterprise's overall success, and we're going into a relationship oriented world and you should be working to build those relationships.
Jason Pereira: Yeah. But I think the myth of the self-made individual is that, it's a myth. You think Bezos got to be the world's richest man because he decided not to hire and delegate. Do you think that they're... The reality is, is that we all require massive amounts of support. It's like the old saying about it takes a village to raise a child. I got news for you, it takes a large ecosystem to make a company successful. And part of that ecosystem has to be somewhat of watching your back like you.
Romesh Hettiarachchi: And I always talk about community. So for me, it's about who is your community or communities. Yes, your team, but it's also your suppliers, it's also your vendors, it's also your customers need clients. And once you start re-imagining how your business fits in into that ecosystem, into that environment. I've had customers, or I have a clients over the last year when they went through the pandemic, their staff were willing to take pay cuts just to keep the company afloat. Or there were vendors that said, "You know what, we're going to extend our payment terms." If you have a solid team, it pays off dividends because your business model becomes flexible.
Romesh Hettiarachchi: And what I'm doing, at its core, is reimagining how lawyers conduct business. And I have to say I'm not the only lawyer that does, I think there's a lots of really good lawyers out there that I'm learning from, and they're learning from me and there's a community out there that's trying to figure out how to get this done right. But at the core, we're talking about how do you have a business model that's relevant and responsive to the needs of how our clients and customers are doing business?
Jason Pereira: Yep. And you can't have that if you have your paramedic or managerial approach, right? Because those are always action trigger, not ongoing. So what have you done in terms of, how have you changed your billing model that is, in order to accommodate the lifeguard in the strategic partner approach?
Romesh Hettiarachchi: So this has been one of the challenges, so let's talk about some of my journey about trying to do this, what's worked and what hasn't. When I started off, I start off with the approach of let's do a subscription price model, where it has a fixed monthly fee which was still premise on me exchanging time for money. So I would say it's X hundreds of dollars and in return for the X hundred dollars, I was still devote my time to you in exchange for a fee. It's still a subscription model, but I'm still at the day exchanging time for money.
Jason Pereira: And it's got a bottleneck. It's got a bottleneck in that we have so many hours in the day.
Romesh Hettiarachchi: Yeah. And especially when you've got other obligations, like family, personal, whatever other obligations you have, your ability to scale is limited to the time that I'm awake or you're awake. So what I think is the next evolution is the idea of delegating tasks to technology, right? So when we talk about building teams, we're really talking about the art of delegation. And traditionally you would delegate it to another human being, whether it be an assistant or a staff member, employee, or contractor, whatever, you're still delegating.
Romesh Hettiarachchi: In the digital age, you can also delegate tasks to technology. And I think that's where the scope of a lot of creativity comes in where you can identify what tasks to delegate, technology does it in a fraction of the time that you or I would be able to do it and the client gets significant value. You, as the service provider, can make a decision of whether you're still going to charge the employee the same rate that I would be charging for the service if you were to do it yourself, or alternatively charge it for a lower amount. And once you start doing that, you'll start realizing there's so many creative ways to build a really unique things that deliver the same amount, if not more value to clients, but allows you to go home at a reasonable time, which is fantastic.
Jason Pereira: And honestly, I mean, at the end of the day, the value is. And this is the same problem in my industry. People confuse heavy lifting as being the value that we provide when the heavy lifting is just the implementation of our knowledge. And that simple example, financial plans, right, how long does it take to do that? Or clients will be like, "Well, of course I'm getting paid, look how long it takes to handle this paperwork." Really? You think that is the value you provide? That's an obstacle to the value you provide, not the value provide. And the way you're reframing your approach to delivery of your knowledge basically is just finding more ways to deliver your knowledge in a cost effective way. But also look at the world we live in, I mean, I interviewed on my other podcast, a company that did a property and casualty insurance for small businesses.
Jason Pereira: I think the average or the most frequently used time of their service was after 10:00 PM. Business owners are busy individuals and this sort of stuff is not stuff that they handle between nine and five. And thinking about your availability, right? Your availability is limit... You have your family and whatnot, you're not going to want to be available at 11:00 PM. But you know what, are they going to want to be able to reuse any number of resources you provide at that hour on a self-serve basis to some degree? They're probably willing to get started there.
Romesh Hettiarachchi: Yeah. And that's actually where I'm moving my practice towards, to be honest with you, I'm moving my practice towards a model where there's going to be lots of resources out there that I'm developing and putting together and kind of like a resource library that my clinical subscription class all have access to at any time they want to, right? So if you want let's say, figure out how to terminate an employee, rather than wait for my time to be available, I've already recorded some material that will get you a significant of the way there, as well as other checklist and this type of other stuff, which will really help him move on and solve the problem.
Romesh Hettiarachchi: It's again, like you said Jason, clients are coming to us to either solve a problem to reduce risk or to manage process. They're hiring us to write documents, to write a contract or to write a financial plan, they're hiring. They're not actually hiring us to solve a problem, minimize risk, or to manage process. That's where our value is. And it's for all service providers, I don't think that's for lawyers. I think for the any service provider, those three things.
Jason Pereira: Well I think you're really hitting on the difference between an experience and basically a product, right? And that's really the difference in logic, right? And too often, it's the old clean Christian succinct, which I've been known to say quite frequently, it's people don't buy three quarter inch drill bits, they buy three quarter inch holes. And too often, we're just like, we're just going to sit back and talk about how great the drill bit is, how great the, or how good or whatever it is we can do this, my contract's better than that, my plan is better than that. At the end of the day, that's not what they want. They just want to know they're going to be okay. And we confuse the tool set that we use to provide the end deliverable outcome with the value we provide, right? Everything, like a contract, a financial plan planner, it's just a stack of paper. That's what it really comes down to, it is the encapsulation of the knowledge we've delivered that is the value,.
Romesh Hettiarachchi: It's a strategy, right? That's what it is. And I mean, a good common criticism that I've faced is that, "Romesh, if you were to use this model than every lawyer is going to be doing the same thing." It's actually not true.
Jason Pereira: No, there's room for lots of models.
Romesh Hettiarachchi: Yeah. And the thing is, is so much os creativity and you're now better positioned to create a model that reflects your personality, your style of doing things in your approach to the practice of law or the practice of financial planning or whatnot, right?
Jason Pereira: I mean, I've already seen this in the accounting field. I've had people on here Live CA and that company I use quite frequently and they've been online on various podcasts. They pioneered a monthly subscription model of accounting and stop turning the relationship with the businesses accountant from being one where you go see the accountant at the end of the year. And they're like, "Oh, here's your tax bill. And here's my bill." What a terrible, terrible experience, right? And their entire thing was, "Look, people expect us to work magic at the end of the year to fix problems we can't fix because it's too late, right?
Jason Pereira: Whereas the model now allows for regular engagement because they're compensated for it and everything is designed around that regular engagement. And the value provided is substantially greater, same basic premise to how I see conversions in my business. And that's for the statement about like, "Oh, everybody will do that." Well, first off, just like my business, it's bizarre, it's like, why do people fixate and think that there's only one methodology for how to deliver a service. How is there no innovation? How are the people just not willing to try something else in terms of how to deliver the same service? It's bizarre to me.
Romesh Hettiarachchi: It is. I think the challenges that we as lawyers, through the legal profession, that's what I'm more familiar with. We are inherently, conservative's the wrong word, but we're fearful of change. Is we don't want to disrupt a business model that historically has worked for... I don't even want to say it works for all of us, but has worked for many of us. But the ability to try and strike out and start your own thing and start something as unique and different is inherently risky, right? I was in the clubhouse room a couple of days ago, and there was a guy that was working in a personal injury firm at a [inaudible 00:17:20], they really want to start out, I really want to do this, but I've got a young family at home, I don't know how to start.
Romesh Hettiarachchi: And so I sympathize with that sentiment. It can be difficult. It is difficult to try and break the mold. But what I would encourage you to really think about is how much of value there is in building something that is your own? How much of support you're going to find once you do build a business on you and your personality and your approach? How much of personal value will you gain? And how much of value could be given to your clients? It might be a rough go for the first year, absolutely. Either really bad... For me trying to do this, first yeah, yeah rough. But I'm loving it now. And if you're a business, forget lawyers, if you're a business trying to do this, if you have the right team advising you, it is possible. Believe it.
Jason Pereira: Yeah. It's funny, so much of this topic is just stuff I love on a regular basis. I get the entire, I have a young family to feed, I don't know if I can take a rest. There's a stage in life where you can't take risks in business and other ones where it's harder. Totally understand and appreciate that. But I also think that I got two subsequent stories. One my industry all the time when I talked about the need to ban certain forms of compensation, because of lack of alignment with client outcome. And people were like, well, while he does not possible to service this group of clients, unless we do that. And my response is universally, what else have you tried? And universally the there's just like, well, what else is there?
Jason Pereira: And why was it? We just assume that this is the only way it has to be. It's bizarre. And then the second piece is, and then this is, this is true of the law profession, legal profession, more than any other profession, I've seen the number of people who seem to go through law school and decided to get into something else is astonishing to me. And I like a friend of mine was, I was a technologist. He basically said like, I didn't want to be a parking meter my entire life. Right. He didn't want to be sitting there measuring every minute of what he was working of, what client he was working on. He found the entire experience, just not rewarding. Right. And he literally just left the entire profession. So I often wonder how many, how many really, really bright people leave a profession? Because the, the structure of the business model is just something that's just one size fits all and not conducive to how they feel they can deliver value or their skillset.
Jason Pereira: Right? The same problem, my industry, the number of incredibly intelligent well-meaning people who get driven out because you're not willing to sell insurance to their cousins and best friends just to stay afloat every other target every month. It's crazy. Right. It's crazy. So if anything, every industry to some degree rewards that people can go out and sell fast. Cause that's how you, that's how you stay solvent early on. Right. But there's something to be said about taking a step back and realizing that maybe that model, that model is not for you. What else is there?
Romesh Hettiarachchi: So what happened? I mean, that's so much of value there. I think at least for me, and the way I look at the legal profession, I talk about five issues that lawyers in general face, the first being we are facing increased competition. There's going to be clients that want more value for less money. You've got another pressure of technology and trying to out-compete technology is difficult. You've got a fourth issue of trying to keep a work-life balance, which is especially true. If you have a young family or you're trying to balance those responsibilities and the lasting mental health and loneliness and decision-making loneliness, right. And to be candid, I mean, it was those five challenges that really compelled me to start me on practice because I struggled with my mental health. I struggled with Frank trying to figure out this, this billable hour model sustainable for me over the next five years.
Romesh Hettiarachchi: And for me, the answer was, no, it wasn't. I did not think, I don't think the billable hour model is sustainable over the longterm. And so for me, the whole conclusion was why do I not invest in myself? And to build a relationship that I know that will be with me for the next five or 10 or 15 years, right? Yeah. That was the decision I may or may not be the right decision for everyone. But that was a decision I made. But going back to your point, I think we as partners also as a governing bodies, our governing bodies are inherently let's cater to the bottom.
Jason Pereira: Oh, the problem of every regulatory organization, you've got to protect the, you got the lowest common denominator, unfortunately.
Romesh Hettiarachchi: Right. But here's the thing. What I don't understand, I struggled to understand is why isn't there a separate program for lawyers that want to challenge status quo? Why don't we have an innovation type of approach to our build the problem with doing it yourself? Is that all the risks on your shoulders? Why is there no program to diversify the risk so that we can all learn from those common experiences and deliver more value to our colleagues as well as society? It doesn't make sense to me, but maybe I'm just silly.
Jason Pereira: I agree. I agree. It's, it's it all too often as someone who's been an antagonist for, for a chunk of his career towards industry status quo, and it called some very unfortunate names in public for doing so, I find that it's the old Steve jobs saying, first, they call you crazy, then all this other stuff, and then they start following you and they call you a genius. And I've seen that happen where 10 years ago, the people who were, who were yelling need to like vote, yelling me down or calling me negative words, because I was trying to, I was challenging compensation models and whatnot are fully adoptive now and, and become friends because they want to start disrupting their own thinking, right. And start adapting to the world around them. It's you really, really, really want to get people lashing out at you, attack the methodology in which they make their money.
Jason Pereira: That is, that is one of the most sensitive things, especially when, especially when there's a inter, if they don't want to publicly say it, there's some question in their mind that maybe what they're doing, isn't quite right. Like they lash out of the fence. So I want to address a couple of things. You mentioned specifically the... Specifically around technology and margin compression loneliness, we'll get to in a second because there's a common problem amongst most people who are self-employed the reality is I hear this in every end, in, in most service industries like, Oh man, technology is going to make it harder. My margin is going to compress. Guess what? That's every industry known to man like that is, I don't know why specifically, like my industry, the law, anyone else seems to think that they can avoid this entire trend of how every other business works.
Jason Pereira: But that is exactly what happens, right? Like there is downward pressure on pricing across the board because of competition and technology is part of that. And going back to my other podcast, the reality is I tell people all the time, it's great. Ignore it. If you ignore it, you're going to suffer from margin compression. The only way to fight margin compression is through efficiency. So basically you want to try to, yeah, there's only two ways. You, you keep your service levels high to try to keep your pricing a reason at a higher than most common denominator price. And you have to work on efficiencies. So, and anyone who's an entrepreneur listening to this right now who was basically successful, got to a certain point and knows that's the truth because you can't scale humans when they cost like 60,000 minimum, that start from day one. Like it's really hard. It's really hard to keep your profitability. If it's all a bunch of paper and people,
Romesh Hettiarachchi: This is a funny story. So I used to be, so I never wanted to be a lawyer. I was very left wing, progressive and university, whatnot, less so now. But I think that there are implications of how we're thinking on how we think about employee, employer relationships, but to address a specific point. It's not only a cost of dollar value, but it's also a cost of risk. The thing with technology is that if it, if done right, it will spit out the same output, given the same information. And oftentimes when it comes to people and employees, that is not always the case. And so one of the biggest benefits of technologies, yes, it may be cheaper financially, but it's also a rest, less risky proposition over a longterm, assuming that the technologies can keep developing and keep it up to date. So that's the one piece I want to say. I think that when it comes to technology is not as about a financial thing, it was all from a risk perspective. It also makes sense. But also when we're talking about efficiency, this is an age old thing. Like one week there's two ways to make more profit, keep the costs low, or increase your revenue. And all of the talking about my talk, this production model of rethink, and re-imagining a business model, is that, is that element, how do you lower your costs? Or you increase your revenue?
Jason Pereira: And the thing is, is, I mean, talking about this off here previously, when you move from a model that is designed to sell something, or compensation comes at the time of sale to an ongoing engagement, your mindset around delivering value changes dramatically. I had this conversation with a advisor. I know who's kind of, who's building his business. And he said, contemplating that model, he was like when you really think about it, it really does change the engagement because fee-only planners come in and they deliver in a lot of them just deliver this one plan, maybe the offer, an ongoing engagement, but it's essentially, they've turned the plan into a product in many cases. And he's like, no I've got every incentive to actually take the findings from that and make them bite size and digestible and have a series of meetings to basically stretch it out because I am delivering because then basically I'm not overwhelming them with information, which don't necessarily have to do that, but I'm slowly on a, it's a stewardship as opposed to a delivery.
Jason Pereira: And that's you don't have to be out of that kind of comp compensation while that's exactly how I run my practice. But it's, it's constantly thinking about not where's the next client going to come from. It's more. So how do I basically just meet their needs in different, in as many ways as possible and continue to offer value that's above and beyond. And if you're just looking for the next sale, right? Or if you're looking for the next contract, if you're drumming up business somehow, right? The reality is your mindset is still towards the hunting, as opposed to the levels follow the next thing approach, which is let's make this as nice as possible.
Romesh Hettiarachchi: Yeah. And at least as a service from a service provider perspective, I'm happy because it also means that I have a lot more flexibility. But I think from what the feedback that I received, my clients, I just dealt with this just before this podcast. But for this call, I can start identifying things before my client has even identified an issue. And that in and of itself is valuable. If you are good at what you do, you can say to a client, Hey, guess what? This came across. I was copied on this. These are the things you've got to really be worried about, or this contract is going to affect this relationship. Don't sign it. Yes.
Jason Pereira: Huge value, huge value. I see all the time in my life too, but I'm thinking about it. Like it's again, it's the unconscious and competence, right? Like they don't, they don't know what they don't know. And the number of times, I'm sure you said like, just how many times in casual conversation with your clients just catching up, has something come up that they thought was completely immaterial and you're like, Whoa, hold on, stop right there. And you managed to prevent them from doing something that would have, would have been very foolish or they had, they done it with full permission.
Romesh Hettiarachchi: Oh, I have looked quite legitimate. We might wire, I had a client that was looking to hire an employee for like mid six figures. And, and he just brought up in passing a saying, and I said, stop. We're not doing this. Have you considered your other options? And because you consider this other option, there were lots of other avenues that she considered. And she was great. She was really happy because she, she, she didn't get locked into a con and doing an employment agreement, spending way too much of money for some for services. Some that another one of her employees could do it. Like the value of relationships. If there's one thing that I want listeners to take away from this, the value of relationships, the value of advisory relationships, as opposed to advisory one off services. Isn't man, if you've never tried it, you've got to try it. And like I no longer all my relationships now are for advisory. I pay on an ongoing basis.
Jason Pereira: Yeah. I mean, we talked about this previously. I mean, in large part, mine are as well. I mean, I might a little bit different because I refer a fair amount of business. I know these people on a personal level, so not everybody can have a personal friendship with their lawyer right. Where it's like, I just text him and be like, ah so this is going on. I don't even know anything. Right. Or, or we'll just be catching up. We'll just be catching up at I'll be, before COVID, it'd be a Raptors game. It's like, so what's going on while all this is going on. And it's like, Hmm, we should look at that. Like not, everybody's got the benefit of that. Right. And oftentimes clients are, you know, even in our process, it's like, well, okay, so you've done delivering the entire like value proposition the first year.
Jason Pereira: You're going to update at least every three years. What happens in between what happens in between is I call you and ask you what's happening in your life. Right? You think it's, you think it's, I don't shack. You may think it's idle, chit chat. It's not idle chit chat. It's me constantly looking for things going wrong. It is me constantly looking for things I can fix because it's left to their own devices. People will forget that you do certain things or that things are in your own purview, right? Like, Oh, you do that too. That's the thing. That's the most painful thing I ever hear. So if we're not constantly, and it's not their responsibility to know everything or every value we can possibly deliver it's responsibility to make sure we discover those opportunities for them and help them. So I fully, fully endorsed this.
Jason Pereira: I hate, I really won this last personal story on this. I get approached for doing like one-off financial plans for very high net worth people on occasion. And I've done in the past. They have the least satisfying relationships I've ever had in this business. They are completely transactional. I don't see, I never get to see the progress in migration. They're like, let me ask you this. I mean, for me in my position, one of the things I love in my business, I get to watch people win over time. I get to see their progress. I get to celebrate that with them. I mean, you must've had that experience as well in your thing, like you've seen probably people start off very small and scale, like how satisfying is to be a part of that
Romesh Hettiarachchi: Incredible. I mean, that's the more rewarding part of being like this fractional legal counsel. And the other part of this is that clients are grateful. They're so grateful for this. Look, look, I did. I was at one point in time providing legal services under legal aid just before, just before you became a lawyer. And it was a great relief. It was a great time just because I saw a lot of clients that were very thankful that we're providing the services and I cherished those clients. But I also had another segment of the population that weren't as grateful. That really demanded a lot from me, even though they weren't paying a dime for my services. That's okay. I'm not complaining about it. But all I'm saying is I'm cherished my experience a whole lot more for the client that came to me and said, Oh my gosh, thank you for what you've done. And same thing with my practice as a lawyer, when I saw my career as a litigator. So people will pay me to court to argue. I would so much happier for the clients that were thankful for my services than the clients that just took me for granted.
Jason Pereira: I would also say, I think that this, this model is more conducive to thankfulness, right? Like when you're an ongoing part of our lives and yeah, exactly. Right. Like again, like I said, from the beginning, it's an adversarial relationship with a lawyer almost from day one, the number of times, like I have heard clients say like, I'm like, have you spoken to your lawyer about this? Like, I would say that to them and their responses. Yeah. But every time I call him, he's going to start charging me. It's like first off, most of the lawyers I know are not that clock dependent. They're not going to flip the switch to second, a phone call comes off, but there's that perception. Right. And there's that, there's that there's that antagonism it's just like, we're in a confrontational relationship. I don't want to pay you if I don't have to. And you want to charge me because that's how you get paid. Right. So it just creates such a... It's always any, because it's not an ongoing some that is let's call it. Not just reasonable, but digestible. It's a much bigger number. And here's the other point I think I made through the first time we chatted the predictability of revenues under a model like this as far superior to that, of what you were dealing with before, right?
Romesh Hettiarachchi: Yeah. I mean like, look, it's a pain. When a client is looking to talk to a lawyer who their two biggest pain points are a costly B, I don't know how much we're going to cost. I mean, that's kind of the reason why when it comes to a lot of my contracts or startup services, I do an either on a flat fee or a subscription model, because that gives some pricing, certainty to the clients, look, a client is looking all the client wants to problem solve for a price that they can pay. That's all they're looking for. And lawyers who cannot give them a price that they can pay. The clients would be dissatisfied. And why shouldn't the thing is why should we allow clients to think that they there's no cap on a legal fees? I don't think that's appropriate. It's okay to say to a client, look, here's an estimate, but you, we should not be able to say like, look, I'm going to ding you.
Romesh Hettiarachchi: And every single time you call and I'm going to bill you for every three minutes of six minutes spend on the phone with me. It's ridiculous. So I don't know. I think we, as a profession have a lot to learn from our non lawyer business colleagues about how this trucks are and run their businesses. And I think that if we incentivized to do so, we can provide solar for value. And it's just unfortunate that those incentives on there right now. Exactly. So our masters has been great. Where can people find you if they want to learn more about your services? Sure. If you go to my website, BI lawyers.ca that starting point, there's a whole bunch of free resources there that I'm putting up pretty much on a monthly basis. So if you want any of those, just click on free resources and just download something for free.
Romesh Hettiarachchi: And again, it's completely free. There's no payment made. And yeah. Then if we want to schedule a call, you can schedule the call, register on the website, and put the call in the calendar.
Jason Pereira: Excellent. Thank you Romesh. Very much appreciate it.
Romesh Hettiarachchi: Jason, thanks so much, cheers.
Jason Pereira: So that was my conversation with our Romesh at the BNI. As you can see, we share a very common mind on relationship management and how restructuring the relationships compensation model leads to a restructuring of the value proposition and frankly, a far more fulfilling and better, far more positive outcome for everyone involved. So please take the time to check him out if you were looking for a lawyer. In the meantime, as always, if you enjoyed this podcast, please leave a review on iTunes, Stitcher, or wherever you get your podcasts. And until next time take care.
Producer: This podcast was brought to you by Woodgate Financial, an award-winning financial planning firm, catering to high net worth individuals, business owners, and their families. To learn more, go to woodgate.com. You can subscribe to this podcast on Apple podcasts, Stitcher, Google Play, and Spotify, or find more episodes at jasonpereira.ca. You can even ask Siri, Alexa or Google Home to subscribe for you.