Summary: The following tips will help you improve your law firm’s profits by changing the way those in charge think about traditional business practices.
Although the legal market has somewhat improved since the 2008 recession, many firms are still underperforming when compared to their pre-2008 business numbers. However, there are several ways that law firms can boost their bottom lines, Real Business notes, in its article on improving business, which is equally applicable to law firms.
First, work with your rivals. Apple actually relies on its biggest competitor, Samsung, to obtain quality parts for the iPhone. In some instances, it just makes sense to collaborate with your competitors. When exploring new opportunities, do not quickly dismiss certain relationships or deals simply because a competitor is involved.
Next, get rid of anything you do not actually need. Many consumers have realized that it makes more sense, both environmentally and economically, to share assets, like cars and living spaces. The same practice can apply to your law firm. For example, can you possibly share employees or office space? There are numerous sites that help companies pair up with freelancers, for example. Take a look at your business practices and see where you can start sharing or reducing waste.
In today’s economy, it is important to remain flexible. A long-term plan with little wiggle room will not help your firm advance. Firms must begin thinking in terms of weeks, days, and even hours. It is important to focus on client satisfaction, regular feedback, short development cycles, and daily planning. Rather than set goals for 10 years from now, set goals for this week. How can you make your clients happier? How can you help them receive a better return on their investment with your firm?
Firms also need to understand that the workplace itself has become fluid. With the rise of technology, partners and associates alike are able to log in to firm servers from just about anywhere. If your associates want to work from home one day a week, why not let them try it? So long as projects are being completed and client satisfaction remains steady, the firm has nothing to lose. In fact, productivity has been shown to increase and costs to decrease when employees are allowed to work remotely.
The final point is one of the most difficult for many firms—embracing digital change. Many firms still use outdated filing systems, have boxes of documents all over the office, and many partners cannot even send a fax without assistance. It is time for the law firm to catch up with modern technology so that they can move forward. Updating case management software, keeping your firm’s website interesting and current, and even providing firm apps for your clients to use will catapult your firm into the current digital age.
According to LexisNexis, there are several ways firms can embrace technology.
First, centralizing client records is a necessity. Emails, electronic calendars, timekeeping software, and other programs can help everyone in the firm understand exactly what is going on with a case. How many times has a document gone missing in your office? Chances are, an hour or so was wasted attempting to locate it. Not only is that time not billable, but it is also time that could have been spent on other cases. By implementing a central case management system, such incidents will be avoided.
Similarly, managing the billing process is essential. Invoices need to be sent to clients regularly and promptly. Clients will be angry if they go several months without receiving an invoice, and, when they finally receive it, it lists a substantial balance that is now due to the firm. When these delays happen, many firms take charges off of their bills, which hurts the bottom line. An efficient billing system will improve a firm’s profits.
In the same vein, well-organized timekeeping measures also contribute to a firm’s profits. There are dozens of timekeeping programs that are easy to use and reduce the time that associates and partners must spend calculating their hours.
These practices will contribute to your firm’s success if they are implemented properly. Ultimately, the key to success is to remain open-minded and flexible as the market continues to change.
- See Give Your Law Firm a Competitive Advantage by Understanding This Process for more information.
Source: Real Business
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