Manage your legal practice for success
Understand the challenges
Juggling the many aspects of managing a law firm can undoubtedly be a challenge! The term Practice Management covers areas as varied as finance, human resources, facilities management, IT, marketing and business development, client relationships and compliance. Every practice manager gets pulled in different directions and will be tempted to take on many varied tasks - from fixing a printer to recruiting a new member of staff.
After looking at the cost of having a third party or outside agency to complete this work, you may decide to do the work yourself instead. It’s easy to forget that cost doesn’t always equate to value. I’m not saying that you have to spend lots of money, but it can certainly sometimes be the case that spending money and saving yourself time is more effective.
Compliance rules and regulations are also constantly changing and firms need to be abreast of them in order to survive, let alone thrive. The accounts department of any law firm is crucial to ensuring compliance in many areas but, of course, partners and managers within the firm must do their own checks too.
Lead the firm effectively
The first thing to remember is that Law is not just a profession; it is also a business. To drive the business forward, it is important to consider the many ways to generate new work. Examples include creating an attractive website and building an engaging and trustworthy brand to make your Client want to spread the name of your business through word of mouth.
Other cost-effective ways to drive growth for your firm can be to establish a presence with active social media platforms and to plan relevant advertising and publishing of thought leadership pieces where potential new Clients will see you as an expert.
Responsibility for meeting compliance requirements and for operating effective systems and processes lies with those leading the firm. It can be difficult to balance the pressures of practice management with the responsibilities of Client work, but that is something that every successful law firm manager must do.
Maximise fee earning time
The most successful practices are those that learn and adapt quickly. It is vital to ensure that your financial staff is fully trained in line with the relevant accounts rules, especially when changes are implemented. In 2019, the SRA accounts rules undergo their first major overhaul in years and there are significant changes that all legal cashiers and practice managers will need to prepare for.
There are other regulatory changes to be aware of too, such as HMRC’s Making Tax Digital initiative which took effect on 1st April 2019. Law firms need to make sure that their legal accounting software is up to date, compliant and fit for purpose. Having specialist software to prepare your management accounts and compliance reports will save many valuable hours.
Developing firm-wide case management processes to guide staff through the running of their cases can be invaluable in reducing supervision time. You need to understand just how much effort has gone in to recovering professional fees, without standing over staff as they work and reviewing every file.
Of course, you need to remember that you and your legal staff are the experts and not a computer system, so you shouldn’t rely on a prescriptive workflow that leaves your staff simply ‘joining the dots’. However, systems that streamline working practices can ensure the delivery of high quality, tailored, efficient service.
Improve with technology
I speak to law firms every day about case and practice management systems. I always ask the question, “Do you time record?”. Some say yes with no hesitation, however, most will either say, “We don’t, but know we should” or even “No because most of our work is either agreed or fixed fees.”
In my experience, if your firm doesn’t time record due to fixed or agreed fees or charging agreements, then you have no accurate way of telling how the work your staff does compares to what you are charging and in turn, what you recover. Analysis of your billing success (cost v charge out rate v recovery) is invaluable and if you have a good practice management system, it is very easy to achieve.
I also find that many firms dismiss the idea of case management because they use very little in the way of standard letters and correspondence. I wholeheartedly agree that the management of legal matters is not just a process to be followed, but would encourage firms to look at how you want matters to be run and use software tools to optimise your efficiencies.
There are many resources, services, and software tools available to practice managers. They offer varying levels of automation and assistance, with different offerings inevitably being suitable for different law firms. Use them to your advantage.