It Was the Best of Tools, It Was the Worst of Tools…
wait a minute, legal software shouldn’t remind you of a Charles Dickens novel. Yet this is the story that I repeatedly hear within my network. All too often projects fail, not due to the software, but due to the same common pitfalls:
- Acceptance is crummy as no one wants to change. Users don’t always equate ‘new’ with ‘better’ and sometimes feel as if new technologies are pushed onto them; or
- Instead of focusing on process improvement, firms implement software that could provide efficiencies but they continue to use the new software in the same manner that they used the old software; or
- The software meets all of your important reporting needs but your data stinks, so the output isn’t helpful.
I’m not a change management expert (1) but I have worked with some pretty stinky data (3).
Unfortunately, that same stinky data is the driver for so many critical business decisions. Today, tools exist that can help a firm make decisions, whether proactive or reactive, but a real solution to the “stinky data” problem requires an integrated, easy to use, and flexible tool. A tool that, among other things, enables master data maintenance and encourages frequent attention to data cleanup—not just at the time when the firm decides to take on a major project.
One valuable use case for a solution like this comes in the form of building matter budgets and reviewing matter profitability. Over a series of posts, I’ll dive into effective ways to get a handle on your data, streamline and make your processes more efficient and effective, figure out ways to stand out in a crowded sea of legal providers by delivering quality service and solutions to your clients.
By embracing these concepts and utilizing an effective solution to build matter budgets, firms can expect two primary benefits.
- Managing matter profitability at the start of an engagement allows firms to proactively manage their own profitability. The industry is steadily moving away from just counting hours and fees to understanding the contribution to the bottom line.
- Matter budgets are a fantastic marketing tool to use with your clients. According to a recent Altman Weil survey of legal departments, 46.2% of the 280 responding in-house legal departments listed improved budget forecasting as one of the top service improvements they wanted to see from law firms.
Despite the clear benefits, building a matter budget is not as easy as it sounds, even with tools that can comb through your data, organize it, and display it in a client-friendly format. Because of data quality—or lack thereof—it is hard to identify those matters which can be defined as successful and used as a model for future budgets. And stepping back even further, are you using both quantitative and qualitative data to define ‘successful’ and track it in your system? Do you define success based on the profitability of the matter, the client’s satisfaction, a successful outcome, an excellent resource allocation, or some combination of these metrics?
Raise your hand if you think it would be useful to tag your data so that you can identify these types of metrics and more. Stay tuned for the next part in this discussion.
Written by Suzanne Koch
Suzanne is the Director of Engagement Solutions at Fulcrum GT and plays a key role in managing client relationships and demonstrating the Fulcrum Snap™ Suite. Suzanne has almost 20 years of experience working in the legal industry with a focus on finance, operations, and financial system implementations. She has been a volunteer for the Association of Legal Administrators (ALA), the International Legal Technology Association (ILTA), and currently serves on the ALA Professional Development Advisory Committee (PDAC).