Imagine your law firm runs like a well-oiled machine. Similar types of matters can be churned out, one after another, each executed at the highest possible quality. For you personally, this means fewer crises and late nights at work.
One strategy to achieve the predictable delivery of legal services is through the implementation of organizational best practice.
Key Performance Indicators (KPIs) are an important tool for measuring and managing many businesses, and increasingly for managing law firms, but in our view they are a subset of the bigger picture represented by the concept of “best practice”.
Management systems based on KPIs measure outcomes, while best practice is the management of inputs. Managers using KPIs are like doctors treating diseases, while best practice is like preventative medicine, diet and exercise. Both are required for optimum health.
Like many widely used business terms, “best practice” has become a tired phrase with many shades of meaning, and is often confused with “Quality”. However, for all but a tiny minority of law firms, possessing repeatable best practices is critical to long-term survival and growth.
Therefore while financial hygiene and KPIs are basic tools for building a successful law firm, they do not go far enough. If best practice is not adopted, the symptoms discussed in Step 2 below are almost inevitable.
Law firms actively engaged in generating repeatable best practices encounter numerous obstacles on the way to a profitable and valuable firm; but if it was easy everyone would already have done it. There are good reasons we are not all as fit and healthy as we should be. Diet and exercise are hard, but without them we would not produce as much or live as long. The most effective managers are the personal trainers, the coaches of their businesses.
The challenges typically centre on three core areas: process, people, and technology.
Process. The first challenge to developing best practices is the absence of matter template submission, collection and refinement processes. This process is simply not part of the traditional law firm culture. When firms were small (pre-1980), and margins were wide, (pre-1990), this did not matter. Now, most law firms are so busy acting for clients that they do not have time to fully implement repeatable processes. What results is an ad hoc execution process, and consequently, inconsistent creation of best practices. Firms that successfully develop and utilize best practice have clearly defined processes in which everyone in the firm actively participates. And surprisingly they seem to have more time.
People. The second challenge to creating an efficient law firm powered by repeatedly refined best practices is the prevailing culture of the firm itself. Best practices can only come from the people who possess the relevant legal knowledge and actually manage the matters. A firm that has the right lawyers and a culture that is rooted in developing and working from best practice can quickly gain a competitive edge.
Technology. The third challenge is obtaining the tools that enable staff to participate in the development and refinement of systems and provide the necessary process automation. .
The bulk of a typical firm’s legal, matter and business knowledge resides in the minds of its lawyers and support staff. When an individual leaves, the best practices also leave, and the firm struggles to replace the lost expertise.
Given these challenges, what can law firms do to leverage the greatest possible value from the know-how they sell? How can best practices be submitted, refined, and re- used in a repeatable and readily accessible manner?
The five steps outlined below will help law firms start building a best practice methodology. As in most phased implementation programs, small steps must be taken to build the overall systematic approach to best practice development. Waiting is not the answer - the time to begin is now.
THE 5 STEPS TO A PROFITABLE LEGAL SERVICE BUSINESS
Operating through a best practice approach is critical to developing repeatable and profitable services. With predictable projects, less time will be spent solving problems and more time can be allocated to identifying ways to take the organization to the next level.
To help identify the potential for increased productivity, profitability and customer satisfaction at your law firm, IMG is always available to conduct workshops with partners, lawyers, support staff and administrative staff on an informal or formal basis.