Emerging Approaches to Law Firm Profitability

Emerging Approaches to Law Firm Profitability is the ideal tool to assist with the implementation of innovative business practices, providing essential guidance for those seeking new means of maximizing their firm’s capacity.

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Details

  • Publication date: May, 2018
  • Pages: 200
  • ISBN: 978-1-78358-334-8

Description

The legal profession, like so many other fields, has continued to reel from the deep-reaching and significant impact of the 2008 financial crisis. In the years following the crash, a general downward turn in the demand for legal services compelled firms to tighten their belts, make tough decisions, and come up with innovative strategies in order to survive. One of these was an increased focus on profitability and different means of managing and improving it, a relatively new development for the legal industry. However, in recent years there have been small but positive signs of improvement, manifested in a gradual pick-up in client engagement, as global economies continue to slowly but steadily recover from the crash. It is definitely a better time to be a lawyer, as latent demand begins to manifest in parallel with growing client confidence in a stabilizing market, fast-paced disruptive technological innovations, and significant changes in laws and regulations.

However, this does not mean that firms can afford to be complacent. The legal landscape continues to be in flux, and improvement is slow. Increased revenue and client demand does not come to firms that do not proactively seek it, nor is it achieved by those who are not applying innovative and cutting-edge techniques and strategies to the management of their firm. Of course, delivering the best service to clients should always be a top priority; however, there should also be an emphasis on running the firm like a business, which includes intensive scrutiny of expenditure and coming up with new and inventive ways to generate profit. Managing and growing a firm’s profitability should not just be an exercise for difficult economic periods, but instead must be a priority at all times. Rather than being perceived as an irksome bolt-on, it is necessary to see it as a great opportunity in these times of increased business.

Existing and persistent cultural norms amongst lawyers, however, means that the reform of current business practices does not always come naturally. Nor is it necessarily easy to find the right practical advice that can carry a firm through the transition. Emerging Approaches to Law Firm Profitability aims to be the ideal tool to assist with implementation, providing essential guidance for those seeking new means of maximizing their firm’s capacity. Featuring advice and reflections from a wide variety of contributors, ranging from business and finance professionals to thought leaders and consultants, this book offers in-depth, intensive insight into the challenges generated by today’s dynamic and hypercompetitive legal landscape. Most importantly, Emerging Approaches to Law Firm Profitability moves past the identification of these obstacles and supplies original, innovative ways of tackling them. Expert guidance is complemented by compelling case studies and effective real-world examples, supplying principles that can be applied to firms of any size or capacity.

Contents

Chapter 1: Law firm economics 101: how law firms make money (or “the business of law”) By Stuart Dodds, co-founder and principal of Positive Pricing

Chapter 2: Accounts receivable, billable hours, and collections – the end game or a starting point for success? By Ariela Tannenbaum, CEO of Advanced Financial Analytics

Chapter 3: Better, faster, cheaper – why clients expect law firms to know about process improvement By Hélène Russell, founder of TheKnowledgeBusiness

Chapter 4: Fully loaded or not? By Peter Lane Secor, director of strategic pricing and project management at Pepper Hamilton LLP

Chapter 5: Developing and defending a profitability model By Paige Keith, chief financial officer at Hawkins Parnell Thackston & Young LLP

Chapter 6: In favor of a client- and product-focused profitability analysis By Thomas W. Van Der Moere, chief financial officer at Neal, Gerber & Eisenberg LLP

Chapter 7: Better business plans – a blueprint for strategy realization By David J. Parnell, columnist and founder and principal of True North Partner Management 

Chapter 8: Insourcing and its commercial attractiveness in boosting profitability By Srinivas Vadali, principal management consultant at PA Consulting, and Manish Khandelwal, IT transformation expert at PA Consulting

Chapter 9: A model to gauge and understand fee-earners’ performance By Rupert Hawke, managing director of UK firm Cartwright Kings

Chapter 10: A data scientist’s perspective on law firm profitability by Zev J. Eigen, founder and chief science officer of Syndio Solutions

Chapter 11: Combining newlaw and established law to create profitable business strategies by Katherine Thomas, consultant and former co-founder and director of Vario for Pinsent Masons

Full overview

Authors

Stuart Dodds
Stuart J T Dodds is co-founder and Principal of Positive Pricing, which provides pricing and legal project management strategy and implementation advice to the world’s leading law firms. He was previously Baker McKenzie’s director of global pricing and legal project management; prior to joining the firm, Stuart conducted a similar role at Linklaters, having previously worked as a management consultant for 17 years. He is an accredited Certified Pricing Professional (CPP), Accredited Legal Pricing Professional (ALPP), sits on a number of industry-related advisory bodies, and is a Fellow of the College of Law Practice Management.
David J. Parnell
David J. Parnell is a business of law author, columnist, speaker, and the founder of legal search and placement boutique, True North Partner Management.
Hélène Russell
Hélène Russell of TheKnowledgeBusiness is a lawyer (non-practising) and specialist in knowledge management. She has worked as a self-employed KM’er since 2008, and specialises in translating complex academic thought leadership and cross-boundary theories into practical tools to improve the efficiency and profitability of law firms. Hélène is the author of Knowledge Management Handbook (2012) and Practical Projects in Legal KM (2015), as well as several chapters for ARK’s multi-contributor books. She is a frequent conference speaker and runs regular open KM training events, as well as overseeing nationwide KM community groups. Hélène has completed an executive MBA with distinction, with a focus on antecedents to knowledge sharing within UK law firms.
Peter Lane Secor
Peter Lane Secor is the director of strategic pricing and project management with Pepper Hamilton LLP. Mr. Secor concentrates on legal project management with a focus on improving effi ciencies through shared management responsibilities, strengthening communication and making value transparent. His expertise includes client/matter profi t analysis and providing partners with performance evaluations from a fi nancial perspective.
Rupert Hawke
Rupert Hawke is the managing director of the UK’s Cartwright King Solicitors, having originally joined the firm as finance director in 2007. Holder of a business degree and a qualified management accountant, Rupert spent much of his career working for a large multi-national organisation before applying his wide-ranging experience and business acumen to the legal sector. He has overseen significant expansion at Cartwright King, which now has 19 offices nationwide, that he has contributed to with his development of management information systems and grasp of the modern business environment. Rupert is also the author of many articles advising on management within the legal sector. 
Paige Keith
Paige Keith is a business executive with extensive experience leading financial and accounting operations of law firms, including planning, reporting, billing, tax compliance, and accounts payable. Before becoming a chief financial officer at Hawkins Parnell Thackston & Young LLP, she spent 15 years in various management roles responsible for developing and implementing strategic initiatives. She has also overseen client relations and the delivery of legal services, emphasizing the design and integration of consumer-centric business models and technology. Paige studied at Southern Methodist University in Dallas, Texas, where she earned an MBA from the Cox School of Business and a BS in mechanical engineering with biomedical specialization.
Manish Khandelwal
Manish Khandelwal has an extensive range of management expertise and practical experience covering IT outsourcing, offshoring, procurement and business transformation. He has led various multi-million pound outsourcing and IT enabled change programs helping clients achieve the most from their sourcing and IT transformation initiatives. His areas of expertise include end-to-end management of outsourcing programs, procurement life-cycle management, contract management, supplier selection and management, change management, stakeholder management and relationship management. He has worked in delivery and pre-sales, led supplier sales teams and has a strong techno-commercial understanding of the offshoring business.
Ariela Tannenbaum
Ariela Tannenbaum is the CEO of Advanced Financial Analytics, a consultancy firm focusing on enhancing law firms’ profitability. She has over 25 years of top tier leadership experience working with global Fortune 500 companies, instilling the financial intelligence and discipline used by the most successful organizations in the world to drive performance at law firms. Prior to establishing Advanced Financial Analytics, Ms. Tannenbaum served as executive vice president of finance at one for the largest companies in the world and global head of finance of its $2 trillion investment management subsidiary for over 14 years. 
Katherine Thomas
Katherine Thomas helps legal service providers across the world grow, adapt and increase profitability with her company Katherine Thomas Consulting. With a reputation for strategic thinking combined with a large dose of pragmatism, she advises on strategy, sales, client development and the launch of new products and services. Now a consultant, speaker and coach, she previously established and led the well-known UK newlaw business Vario, a legal services provider with an emphasis on flexibility, for commercial law firm Pinsent Masons. As a result, she has a deep understanding of how alternative approaches to legal services delivery can increase competitiveness.
Srinivas Vadali
Srinivas Vadali is a seasoned consultant and C-suite advisor with more than 17 years of experience in shaping strategy and delivering major change and transformation programs. He has expertise in commercial services, sourcing, business case/financial management, transition and location strategy. The focus of Srini’s work is to help clients improve the value delivered by their business services arrangements, establishing in-house and outsourced shared services and using technology to drive organizational change and improvement in business performance. His client base over the last 17 years has included wide range of financial services institutions, including a premier stock exchange, commercial insurance, retail and core banking.
Thomas Van Der Moere
Thomas Van Der Moere is the chief financial officer at Neal, Gerber & Eisenberg LLP, a Chicago-based law firm with over 140 lawyers, where he oversees the financial operations of the firm including the areas of xii About the authors accounting, treasury management, planning/analytics/business intelligence, practice economics and strategic pricing, financial systems, and new business acceptance and risk management. Tom has expertise in professional service firm administrative and financial management, performance and compensation analysis, financial and operational analysis and modeling, strategic planning, process development and re-engineering, firm/project profitability and risk management, and business intelligence. He also has significant financial experience with public and private companies in professional services, energy, and manufacturing industries. Tom has an MBA from the University of Chicago Booth School of Business and an MS in Accounting and Business Management from the University of Tulsa.
Zev J. Eigen
Zev J. Eigen is the founder and chief science officer of Syndio, and a data scientist focused on AI and machine learning applications in HR, labor and employment law, and legal services broadly. He was honored as one of the Financial Times’ 10 most innovative lawyers in 2016, as a FastCase50 Innovator of 2016, and as one of “40 Under 40 Rising Legal Stars” by the National Law Journal. He is frequently quoted in the media as an expert on big data solutions, predictive analytics and machine learning, especially as applied to HR and legal services and products.