April 20, 2005
Planning Assumptions
Assumptions provide the link between the past and the future. Managers are engaged in building a different law firm for a different future. Plans are no better than the assumptions used. Assumptions are temporary estimates of the future—what will be different and how; what will not be different. Most businesses tend to skip or skim over assumptions as a part of planning, leaving the firm highly vulnerable to unanticipated, or unprepared for, changes. Assumptions are one of the principal tools for focusing on opportunities. Assumptions are inaccurate; it is the process of adjusting assumptions that yields accuracy.
This process of changing your assumptions as time removes uncertainty separates those firms prepared for the future from those surprised by it. It explains clearly why the firm’s plan must be to change the plan.
Your assumptions should include all of those things that have or can have a major impact on the firm including:
- Changes in the demand for types of legal services
- Major clients or practice classes
- Competition - impact on rates, services, technology
- Labor force - availability, salary levels, retirements, etc.
- The economy - inflation, cost of critical services
- Facilities and other major suppliers or resources - availability, cost, etc.
- Technology developments - phone, Internet, hardware, internal systems, etc.
- Government, Courts, Agencies, etc. - regulations, controls, laws that will impact the firm or clients
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Filed under Management, Planning by Tom Collins