Look Up, Not Down

Everyone wants to make more money – but most people are focused on the wrong thing. In this solo episode, Eric Green breaks down why obsessing over small expenses is a losing game – and how shifting your focus to revenue, billing, and productivity is what actually moves the needle. Using real-world examples from law firms and professional practices, Eric explains where cost-cutting makes sense, where it doesn’t, and why “looking up” instead of down can add hundreds of thousands to your bottom line. If you’re serious about growth, this episode is your wake-up call.

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Look Up, Not Down

Why You Need To Always Look Up, Not Down

Thanks for joining us for this episode. I'm Eric Green. I have no guests for this episode. I wanted to record this because I've had a couple of conversations in the last day that reminded me about a lesson and I wanted to share that with you. I'll tell you how it started. I had a friend of mine. He has a firm handful of lawyers. Everyone wants to make more money. He's got some partners. Now, the partners didn't start the business from scratch. They came up inside the business. The good thing about that is you've gotten to know them after a number of years. You know their talent and they know the clients. There's something very good about that. One of the negatives about having a partner who never had to build a business themselves from scratch is they almost don't understand what's important and what isn't important. I'm going to explain to you why you always look up and not down. I'm going to tell you what that means. My friend tells me they're now having partnership fights whether they should be paying for the Wall Street Journal, $189 a year or should they stop getting all the variations of coffee in the kitchen. Something to cut expenses. What I told my friend, “Let's say that you do this. You spend hours and hours of your time and their time at billable rates that are a complete waste of time. Anyway, let's say you do that. How much do you think you could come up with?” $5,000 or $10,000. Divide that by five partners. It's $1,000 or $2,000 each. Don’t get me wrong, that's nice. That doesn't move the needle. I was talking to another partner and again, like everybody, he likes to make more money. Their firm's larger. It’s about 50 lawyers or maybe a little less. Maybe 35 or 40, but they're bigger than we are. [bctt tweet="One of the negatives about having a partner who never had to build a business themselves from scratch is their lack of understanding about what is and is not important." via="no"] His thing was, and I've been told this by a senior partner of mine years ago, Bob Percy. He told me once where I was talking about money and making more money. He said, “Eric, look up. Don't look down.” I said, “What do you mean?” “It's about the revenue, dummy. Not the expenses.” By the way, there are exceptions to this. I'm sure there's some high-priced piece of software that maybe you don't need and that's $10,000 or $15,000. That helps, but it's not going to move the needle in any meaningful way across 5 or 6 or 3 partners. It's nice but it doesn't do anything. I said to my friend who came to me originally, “How much is your partner's billing?” They're billing around $1,400 hours a year. Their average billable rate is around $600. I said if each of them bills 200 hours or 1,600 hours, honestly, it's not that much. It's not asking too much. Let's say they all bill an extra 200 hours. Now, the firm across the five of you has 1,000 hours at $600 dollars. That's $600,000. $600,000 moves the needle for all of you to spend two days going through everything. First of all, you're wasting $4,800 a day at billable time across five of you. You already wasted $20,000 looking for the $5,000, $10,000 or $15,000 that you're going to find. It doesn't mean anything.     My friend, by the way, at the bigger firm said he reminds his partners of this, “If everyone wants to make more money, then look at your hours. Are you billing 1,800 to 2,000 hours?” At that point, you're busy now. You're going full-time. If you're not in 1,800 hours, don't come talk to me. In fact, in many firms, you're not even eligible for a bonus. In some of the big firms, you wouldn't have a job. Eighteen hundred is the minimum at most firms. The first thing is, let's push the top line up. Pushing the top line up makes a major difference going up from $600 to $625 to an hour. If everyone's billing about 2,000 hours, now it's $50,000 a person across the whole firm. That moves the needle. Look up and don't look down. Focus on the revenue. Don't focus on the BS minutia expenses that don't mean anything. I will tell you, we don't want to be wasteful. I'm not glossing over. The people spend whatever they want. It doesn't mean anything. That's not true. Enough of that will add up.

Eliminate Unnecessary Expenses Through Automation

Again, I don't want to be flip about this. An extra $2,000 is $2,000. For most people, that's significant money, so I'm not suggesting it. Don't do that. If you see an expense that is unnecessary, then get rid of it. I wouldn't spend your time tearing your hair out trying to find more money in the expenses. Chances are, there isn't enough to make a meaningful difference. Your goal should be to push the top line up. Now, where can you cut expenses that do mean a lot? Automation. Can you literally not bring in all of the tax season help? They could be anywhere from 50 to 200,000, depending how big your operation is. [bctt tweet="Spending on whatever you want may not mean anything at first, but it will add up eventually." via="no"] Honestly, do you need all of these senior associates and non-equity partners? If they're not billing enough, it means either there isn't enough work or they’re just not working very hard. I would have a conversation with them like, “You got to work harder. If you don't have enough work, come see me.” If you don't have enough work to support the people, unfortunately it's unpleasant because you have to let people go. It's the nature of business, but you want to focus on the top line. You automate what you can. If you see any dumb expenses, get rid of them. The real thing that's going to move the needle for you is to push the revenue up. It’s like that across the board in every industry, period. Move the top line and it moves the bottom line. You cut the expenses. It helps but usually it's not enough to make a meaningful difference. When you're going to start in 2026, and we all want to make more money. You're going to focus on that. Focus on what you can do to drive the top line. That's what's going to move the needle. That's how you're going to make more money. Don't worry and don't make yourself crazy about the little itty bitty things. If you see them, you get rid of them. Otherwise, I wouldn't spend another moment focusing on that. Automate the major expenses because that's going to reduce staff. It helps make everything more streamlined. You collect your money up front. All of the normal automations that we talked about, put those in place. That's key. After that, your goal is to drive sales. I would rather you take on the extra expense of driving digital sales and digital marketing to push the top line. That will come back 3 or 4 or 5 or 10 fold to you. Don't worry about the Wall Street Journal for $189. Nobody cares and it's not going to make a difference. See you in the next episode.  

Important Links

• Eric Green
• Tax Rep Network YouTube Channel
• Tax Rep LLC