Profitable Can Still Be Too Expensive

By Jordan Ostroff · Law firm coach

What do Marie Kondo, Jurassic Park, and a law firm owner staring at a profitable lunch on the calendar have in common?

It is not that Marie Kondo could have saved Jurassic Park with better labels. Although “raptor paddock” does feel like a category that should have received more attention.

All three force the same question: just because something has value, does it still belong here?

Law firm owners are usually taught to ask whether something makes money. Good question. Incomplete question.

A case can pay well and wreck the team for three months. A referral source can send business and make every lunch feel like a hostage negotiation with appetizers. A service can generate revenue while requiring so many owner touches that the profit slips out the back door.

Sometimes the thing making money is still too expensive.

The Lie We Tell Ourselves

“If it is profitable, we should keep doing it.”

That sounds responsible. It is also how owners end up protecting work they hate because the spreadsheet gave it a passing grade.

But the spreadsheet usually sees collected revenue and direct expenses. It does not automatically count the Sunday-night dread, the employee who needs twenty minutes to recover after every call, the write-off nobody coded correctly, or the owner time spent fixing a relationship that was supposedly “great for the firm.”

Excel can calculate a margin. It cannot see your team drawing straws to decide who has to call the client.

Jurassic Park sold tickets. The accounting problem was not demand. The problem was that the operating model included escaped dinosaurs and one wildly overconfident IT department.

Your firm probably has fewer velociraptors. Hopefully. But it may still have profitable work with hidden teeth.

What Needs to Change When Work Is Profitable

You need a broader definition of cost.

For every case type, referral relationship, service, or recurring commitment, ask what it produces and what it consumes. Money matters. So do staff hours, owner attention, write-offs, rework, emotional recovery, calendar disruption, and whether the work moves the firm toward the life you are actually trying to build.

This is not permission to quit anything mildly annoying. Work is still work. Even Mario has to run the same castle more than once, and apparently nobody in the Mushroom Kingdom has considered putting the princess somewhere else.

The point is to stop using revenue as the only witness.

On Shark Tank, “people love it” does not end the conversation. They ask what it costs, what the margins are, and whether the business can survive the growth. Your firm deserves the same follow-up questions before another “great opportunity” becomes a permanent calendar block.

What This Looks Like in Real Life

I had a referral source who had sent me at least $10,000 in business. On paper, this was a valuable relationship.

We had a lunch scheduled in Orlando at a place I really liked. When I saw the lunch on my calendar, I dreaded it.

The lunch itself was fine. Then the check came, and the other person silently stared at me and the check until I picked it up.

No conversation. No playful reach for the bill. Just a quiet game of The Price Is Right where the winning bid was apparently “Jordan pays.”

And yes, paying for a referral lunch is normal. That was not the real issue. The check just made something obvious that the revenue had helped me ignore: I did not enjoy spending time with this person.

I was giving away time, energy, and money to maintain a relationship I dreaded because it had technically produced business.

The referral revenue was real. So was the cost.

Once I admitted both, the decision became much clearer. A relationship can pay and still be wrong for the business and life you want.

How to Start Fixing It

1. Build the whole receipt.

Pick one case type, referral source, service, or recurring meeting. Write down collected revenue, direct costs, team hours, owner hours, write-offs, rework, extra client communication, and any work it displaced.

Do not turn this into a forensic accounting miniseries. A reasonable estimate is better than another year of saying, “I think it is profitable.”

Proof it worked: someone other than you can explain what the activity contributes after the major costs, not just repeat the gross revenue.

2. Add a fit score.

Rate it from one to five on four questions: Does it attract the clients we want? Does the team know how to deliver it well? Does it create an acceptable level of friction? Would we choose to do more of it next year?

The last question matters. If the thought of doubling it makes everyone stare into the middle distance like they are trapped in an Office Space sequel, the revenue number is missing part of the story.

Proof it worked: the owner and the team can point to the evidence behind each score, and the scores lead to a keep, change, or stop decision.

3. Name the hidden-cost limit before the next opportunity.

Create one rule for the category you are reviewing. Examples: no case stays with the firm after two documented staff-abuse incidents; no referral relationship gets a standing monthly meeting unless it creates the right introductions or a relationship we genuinely value; no service continues after two quarters below its target margin without a redesign.

This is the business version of putting bumpers on a bowling lane. You may still throw the ball directly at one of them, but at least the system has made its opinion clear.

Proof it worked: when the limit is reached, the team follows the written rule instead of reopening the entire philosophical debate.

4. Replace the space on purpose.

If you stop something that produced revenue, decide what gets the recovered capacity. A better-fit case type. A referral relationship you enjoy. Team training. A Friday afternoon that remains a Friday afternoon.

If you do not give the recovered time a job, email will adopt it before lunch.

Otherwise the empty space will refill itself. Calendars are basically a game of Tetris. Leave two open slots and five meetings start falling from the ceiling.

Proof it worked: sixty days later, the recovered time is being used for the replacement you chose, and the old activity has not returned under a slightly different name.

The Real Point

The goal is not to build a firm with zero annoying work. The goal is to stop confusing money received with value created.

Some work pays twice. It produces profit and gives the team more of the clients, relationships, and operating rhythm you want.

Some work pays once, then sends an invoice for your attention, your culture, and your life.

This week, pick one thing you keep calling profitable. Build the whole receipt. Then choose: keep it, change it, or stop it.

If the math says yes but your calendar, team, and stomach all say no, keep asking questions.