Starting the Journey to Law Firm Best Practices

May 13, 2019

by Neil Butten – Solutions Architect, Fulcrum GT

A Potted History

Before working in the legal industry I worked in an environment where process and cost efficiency were the guiding principles we adhered to. As a consultant I helped companies across several industries use technology projects as a foundation to standardize, streamline and restructure their finance operations – we called it Finance Transformation, but now it has been renamed Digital Transformation. The transformations included everything from taking ERP implementations live; to offshoring and nearshoring resources; to writing work process guides and instructions. Each time, the advice given was based on an assessment of current desired capability.

Entering the legal industry for me was like entering a business school case study. Workflow was managed through email. Activities were duplicated and replicated across each office with limited centralisation and central governance. Many processes were manual and had exceptions. Where applications were used, these were in many cases tactical or in-house built solutions that had been in place for a decade or more. Applications were tied together with integrations that periodically stopped working. The infrastructure required investment. Reporting was constructed using SQL, transactional reports, Excel, and macros. And, when the annual partner review, fee earner review, budgeting, year-end, audit cycles came around – the teams just worked harder to make last year’s spreadsheets, macros, and SQL scripts work again.

It worked because people worked hard to make it function. But it was a flawed foundation on which to base future expansion or revenue growth and there was minimal opportunity for cost savings.

Conducting a Capability Assessment

Conducting a capability assessment requires an understanding of how the current organisation performs in relation to the worst and best practice from across industry for each area being assessed. From one extreme, for example, the presence of a non-integrated, localised function; to another, where functions and processes are fully integrated and performed within a cost predictable and efficient location.

To conduct the capability assessment the operations of a law firm back office organisation can be broken down into distinct categories with capability in each category scored from 1 to 5 against a predefined benchmark. An example of which is contained within the table below. However, depending on the level of detail required, the firm may wish to add more categories or subdivide categories. For example, the firm may wish to subdivide the process assessment into level 1 or level 2 processes (e.g. FinanceService to Cash, or HR – Recruiting and Onboarding).

The scoring of each category requires honest and impartial input from subject matter experts.

 

 

The Output of a Capability Assessment

Once the firm has conducted an assessment it is easy to graphically display, current capability, and target capability or the firm’s vision for change.

 

After determining the vision, the firm then needs to determine what action will be taken to recognise the desired improvement in capability. Successful implementation of these improvements requires coordination of the people, business process and technology elements through effective leadership, a coherent strategy, and a robust business case that is reviewed frequently.

Delivery of Improvement

There are several approaches to performance improvement.

These vary from tactical activities that provide limited opportunity for improvement, for example:

It is critical that the firm recognises the limitations of taking a tactical approach to improvements. Tactical improvement projects may further embed and increase reliance on existing operating models, inferior, outdated or end-of-life technologies, or result in the absorption of more hidden cost in the form of new interfaces or systems to support.

Often, the firm is better advised to engage in a strategic change that requires the delivery of activities that alone would be tactical in nature.

Neil joined Fulcrum in its esteemed Innovations Group as a Solution Architect. Neil has completed multiple full system implementation life cycles across numerous geographies using various innovative technologies. Recently, Neil served as Global Business Process Architect for the top 5 global law firm Norton Rose Fulbright, and as Senior Adviser/Consultant for the Big Four Giant Deloitte

Check out Martin Telfer’s Why ERP Really Matters or Is the Era of ERP for Law Firms Finally Here for more information about technology-driven change.