We’re announcing an irrefutable truism in today’s digital world: Size no longer matters. Midsize law firms can now go head-to-head with larger rivals to win business in global markets.
Historically, midsize law firms struggled to compete against more prominent, well-established firms with deep cash reserves to hire top-notch lawyers and abundant resources to overcome any obstacle.
Today, technology has leveled the playing field. Legal financial analytics and automation tools provide breakthrough insights and game-changing efficiencies so your midsize firm can operate more nimbly and scale effectively to compete—and win—against Goliath firms.
Legal Financial Analytics: Maximize Your Firm’s Competitive Advantages
Using modern BI and legal financial analytics tools significantly enhances data transparency to deliver empirical insights that help you raise your firm’s competitive profile—without corresponding rises in costs. For example, you’ll be able to drive more profitable decisions when you can:
- Determine which practice areas and matter types are most profitable.
- Assess which practice areas will withstand billing rate increases.
- Evaluate customer acquisition costs and spot trends in the customer lifetime value of your clients.
- Evaluate every billable hour at client, matter, and individual lawyer levels to understand the effects of utilization, realization, leverage, and profit.
- Optimize your legal processes for the highest efficiency.
- Assess the effects of strategic initiatives regarding pricing, resource allocation, and revenue generation.
Modern legal financial analytics and BI software help you identify your firm’s existing advantages and bring new advantages to light to ensure you’re consistently capturing—and providing—more value.
Get More Work Done without Hiring Additional Personnel
Practical strategies for scaling business must simultaneously focus on increasing operational efficiency. Automated tools enable your lawyers and staff to provide more cost-effective services without hiring more personnel.
Maximize efficiency with tools such as real-time alerts, electronic prebilling workflows, scheduled report generation and distribution, and lawyer-friendly dashboards. Automated tools cut out the manual activities that mire your firm’s professionals in time-consuming and error-prone work, so they accomplish more in less time. Enhanced accuracy and timely notifications also eliminate errors, omissions, and oversights to speed progress and save costs.
Develop New Competitive Advantages with Increased Technological Agility
Automated timekeeping software can help each of your fee earners capture 8-10 more billable hours every month. It also provides your firm with new competitive advantages.
For example, automated timekeeping software enforces outside counsel guidelines during time entry, so errors never enter your system. The CLOC 2021 State of the Industry Report found that of the legal departments that formally review law firm performance, 53% evaluate adherence to billing guidelines. At the same time, 85% of General Counsel say providers don’t follow their outside counsel guidelines, according to an EY & Harvard 2021 Law Survey. This gap represents a prime opportunity for midsize law firms that can promote their ability to adhere to even the most complex guidelines consistently.
Combine the use of advanced timekeeping software with automated prebilling tools to access features that:
- ensure billing entries comply with firm-defined thresholds before sending prebills for lawyer review,
- automate routing to ensure online reviews, edits, and approvals move forward quickly, and
- significantly ease prebill opening, review, editing and approval.
With these automated advantages, you do more than send more accurate invoices that get paid faster. You also earn the trust (and business) of clients who appreciate flawless and predictable billing interactions with your firm.
Use Legal Financial Analyses to Make Profit-Led Decisions
Law firm leaders used to base strategic decisions on experience, gut instincts, and best “guesstimations.” Today, legal financial analyses and modern BI tools allow you to:
- finally make the crucial digital connections that will enable your systems to exchange up-to-the-minute data, and
- intelligently model potential scenarios using historical data to perfect your profitability strategies and determine the optimal actions to take now.
- create and track accurate budgets with the ability to tie collections to the associated work and costs in previous periods and tie work to anticipated future collections.
- model multiple pricing scenarios—including hourly, fixed fees, and blended rates—to make more effective pricing decisions.
- quickly determine whether new endeavors and traditional practices are performing well by accessing customized dashboards that offer real-time snapshots and reveal long-term trends.
- enable decision-makers to choose their next moves with confidence based on the data your firm collects every day.
Share Data to Promote a More Collaborative Culture
Sharing profitability and performance metrics across the firm shows lawyers how their efforts impact the firm’s financial health. It also promotes a proactive mindset. When everyone engages with the same information, they build mutual goals. This strategy supports a more collaborative culture in which everyone works together to help your midsize firm thrive.
In a rapidly changing world, BI and financial analytics software give your midsize firm the agility and insight to compete with any size firm on the world stage.
