Knowledge is power and having the relevant information on-hand can be the core difference between missed opportunities and strategic advantage.
Almost every system used by law firms today, collects and stores some sort of data that is rarely exposed in any meaningful way. Practice Management, Document Management, CRM, telephone and email systems all collect information that can help firms in ways that are not often considered.
Many large organisations are exceptionally good at using the information they collate within their systems to improve their offerings, reduce risk, build revenue and decrease costs. In IT speak, this type of information extraction is referred to as Data Mining or Business Intelligence. For a law firm of any size, this is just as relevant, but fortunately it does not require large investment or additional systems to make a difference.
You can improve your offering to your clients, reduce risk to your firm, decrease costs and increase your revenue, by simply using the data that your systems have already been collecting.
Practical examples for law firms
Just some practical examples of how a law firm’s data can be extracted and presented in a meaningful way include:
Cash flow – Querying your financial system to visualise lockup across the firm or by work-type. Having a clear breakdown of WIP and debtor days by practice or work-type, can provide the information required to focus on and rectify the specific areas that are impacting cash flow. Reducing lockup can also help to minimise bad debt and visualising that correlation can help to introduce and enforce better billing practices across your firm.
Risk reporting – Understanding which client documents are being copied and used as ‘precedents’ by monitoring document history. Knowing which existing client documents are being saved as new documents and modified for re-use, not only allows you to identify and address risk to the firm, but it can help to focus your precedent development efforts.
Dynamic budgets- By merging the information already in your financial system with annual leave information in your payroll system, you can generate dynamic budgets that become more than just a division of annual budget by expected production days. This encourages leave to be accurately accounted for and removes ambiguity around performance measures that would otherwise be skewed by the timing of leave and holidays.
Relationship strength – Even without an advanced Client Relationship system in place, email and telephone systems alone are a great source of data to derive meaningful client contact information. Useful information includes being able to easily identify who within your firm has the greatest contact with particular client(s), or which individual within a client organisation has the greatest contact with your firm or individual fee earner(s). Being armed with this type of information, improves your ability to successfully pitch for new work, better manage internal staff changes and proactively respond to staff or role changes within a client organisation
Making it count
Delivering meaningful information is as much about ensuring that the information you are presented with is aligned with your firms’ operational and strategic objectives, as it is a technical IT exercise.
Apart from being presented with relevant information, it is also worth knowing that you can have your systems setup to alert you when a relevant event is triggered, this is referred to as ‘exception’ reporting. This type of exception reporting allows you to be monitoring much more information than your busy schedule would otherwise allow you to personally monitor. An example of this type of exception reporting may be a certain number of days without contact with key client(s), monitoring the use of discouraged words within client documents or simply monitoring certain financial thresholds such as WIP build up or debtor days.
Data stored and hidden away within your systems is of no value to you. We have helped a number of firms to achieve a range of strategic and operational outcomes by better utilising their systems and taking advantage of the data already being held within their existing systems.
Firms are undoubtedly being faced with an increasing number of challenges. However there are a range of new opportunities available for those firms that can assess and respond to the emerging challenges. Your firm already owns very powerful information about your practice, your clients and your interaction with them.
Knowledge is power and your firm has likely been collecting it for some time.