Most law firms skip annual planning entirely or treat it like a box-checking exercise.
At Sterling, our annual planning meeting is one of the most important gatherings we hold each year. It sets the trajectory for law firm growth, aligns our entire leadership team, and identifies what we’re actually going to accomplish over the next 12 months.
Here’s how we approach it and what you need to know to make yours productive.
Start With Data, Not Hope
Jeff Kerlin, our president, oversees the entire planning process at Sterling. We begin with our client acquisition waterfall, which outlines every step from lead to signed agreement.
We know our answer rate by region. We know what percentage of leads are quality. We know our console set rate, show rate, and close rate. We know our average client value and cost per agreement.
This data lets us reverse-engineer growth.
If we want to grow revenue by 17%, we need X more qualified leads, which costs Y dollars, which requires Z additional staff to handle the volume.
Without this foundation, annual planning becomes guesswork. Building competitive advantages starts with understanding your numbers cold.
Budget Before the Meeting
Along with our CFO, Todd, we start the budgeting process in September, months before the actual planning meeting.
We begin with projected top-line revenue. Then we work backward.
If we’re growing by $3 million, how many more attorneys does that require? How many paralegals? What about law clerks, intake staff, and corporate hires?
We throw everything we want into the budget first – all desired costs, initiatives, and hires. Then we examine where that leaves us from a net income standpoint and rationalize from there.
The key is timing.
We don’t hire everyone on Day One.
Two attorneys in January, three in March, two more in June. It’s educated guessing, but it’s based on historical patterns and growth trajectories.
We identify “have to haves” versus “nice to haves.”
Attorneys and paralegals are non-negotiable.
Employee appreciation events and experimental technology might stay in our back pocket until we know we can afford them.
By the time we present to the leadership team, we have already gone through multiple drafts.
The team sees a cohesive financial plan, not a first draft.
Coordinate With Marketing Early
Over 86% of Sterling’s revenue comes from our website. Law firm marketing drives our growth.
We share projections with our partners at Rocket Clicks by region and by month, outlining where we anticipate growth will occur, the lead volume required, and what we can handle operationally.
This is critical.
When marketing works, other things break. Too many leads at the wrong time can overwhelm your intake team, hurt answer rates, damage lead quality, and ultimately hurt your reputation.
We throttle marketing up and down throughout the year based on capacity. You need that coordination between law firm marketing strategy and operational readiness.
Who’s in the Room
Our entire executive leadership team attends, including me, our president, our CFO, head of HR, two managing partners (one for Wisconsin and one for Illinois), our sales manager, and our operations director.
These are people who are genuinely excited about growth. If someone in that room fears growth or worries they’ll be exposed as inadequate, they sabotage the conversation. It becomes unproductive fast.
We’ve had to help 1-2 people on the leadership team find something different over the years. Sometimes they weren’t in the right seat. Sometimes fear held them back.
Getting the right people in leadership positions matters enormously.
The Meeting Itself
We spend at least one and a half days on annual planning. Quarterly planning is one full day.
We kick things off with something inspirational.
Our team gets jacked up about conquering the world, growing to new attorney counts, and hitting ambitious revenue targets. That energy matters.
Then we get into the details. We present the financial plan – top line, bottom line, broken down by region and department.
The team asks questions, and we make sure everyone understands them.
Next, we discuss what will break if we grow at our projected rate. The head of intake might flag that five new hires mean she needs another assistant manager. Managing partners identify capacity constraints. These are common barriers that stop firms from scaling. We surface these issues and address them.
Finally, we tackle rocks – our 3-5 major initiatives for the year.
Keep Rocks Focused
Everyone comes with ideas.
We list everything, then vote. Jeff’s firm on this — we can’t do more than five rocks. If everything is an initiative, nothing is.
Some rocks don’t make the cut. People advocate passionately for their priorities.
Sometimes minds change. That’s healthy.
The rocks we choose become our lens for prioritization. When distractions arise—and they will—we ask whether they serve our five rocks. If not, they wait.
We break annual rocks into quarterly chunks.
You can’t deploy a new client portal in 90 days, but you can design it in Q1, beta test in Q2, and launch in Q3.
We ask ourselves at the end: If we accomplish these five rocks, will we be satisfied with how we spent our time? If anyone says, “What was the point?” it’s not a rock.
The Real Secret
Our planning meetings are shorter than most because we do the work beforehand.
We review metrics daily. We share financials with leadership monthly. The team doesn’t need half a day of education before we can have productive strategic conversations—they already know where we stand.
This is the unlock: preparation compounds focus.
When you walk in cold, you spend the meeting figuring out where you are. When you come prepared, you spend it deciding where you’re going.
Keep your rocks ruthlessly minimal. Four beats five. Three beats four. When everything is a priority, nothing is.
Annual planning done right aligns your team, clarifies priorities, and builds genuine excitement about what you’re building together. Done wrong, it’s a waste of time that nobody believes in.
