Highly educated professional people often have a higher rate of success because their education often prepares them for more than one level. For example, consider an attorney’s business in terms of the B-1 Triangle:
- Product: The attorney is the product. You hire attorneys for the services they have been trained to perform.
- Legal: Attorneys are licensed (which protects them from non-licensed competitors). Generally, agreements are in place defining the rights and duties of the members of the law firm, and their relative compensations. In addition, most lawyers enter into engagement agreements (letters) to define their relationship with their clients.
- Systems: Lawyers are trained to establish business systems for performing services, and for invoicing and collecting payment for those services. Systems for leveraging the expertise of more experienced attorneys are tried and true within the legal profession. For example, to provide for efficient and cost-effective legal research, less experienced, less expensive attorneys will do the initial research to find applicable case law on an issue, which is then provided to a more experienced attorney for analysis. Commercially available software packages are often used to implement billing and collection systems.
- Communications: Attorneys understand that to be successful they need to maintain a good reputation and a good relationship with their clients. Most law firms market through word of mouth, although some are now resorting to advertising. Most people have an understanding of what an attorney does, which means they need to communicate less or explain less.
- Cash flow: People expect to pay for an attorney’s services. However, this does not mean an attorney can ignore issues of cash flow. Very often services are not invoiced until the end of a mouth during which they are provided, and clients often delay paying attorneys’ fees. It is not uncommon for 90 or 120 days to pass from the time an invoice for services is sent out before receipt of payment. In the meantime, the attorney’s payroll, must be met and bills paid.
Again, this is oversimplified. Yet it does explain why people such as attorneys, accountants, medical doctors, dentists, plumbers, electricians, trucks drivers, cab drivers, and babysitters may have as easier time setting up a business. There is a market in need of their services and willing to pay for their services.
This Article is taken from Rich dad Before you Quit Your Job
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Written by Arshad. A