Iridium Technology: How law firm CIOs strengthen the CFO’s confidence in new IT spending
Law firm CIOs don’t just modernise technology infrastructures; they drive profitable business results. Still, some reluctant CFOs may not yet recognise just how much a law firm’s ability to thrive today depends on how effectively its team members use technology. According to McKinsey’s most recent annual IT strategy survey:
- More than three-quarters of technology initiatives yielded cost reductions and employee experience improvements.
- For more than half of respondents, technology investments resulted in the creation of new revenue streams, and
- More than two-thirds also report increased revenue from existing streams.
Law firm CFOs want to achieve the same—or better—financial gains, right? Of course they do. But they may need a CIO to help them connect IT investments to profits. Here are four ways CIOs can win the CFO’s confidence and get the budget to move the needle.
Lead With Data, Not Guesswork.
When you talk to the CFO, use data to show how technology reduces expenses and drives profit. CIOs often use BI and financial analytics platforms to identify cost and productivity gains from benefits such as:
- automating time-intensive manual work such as gathering data, tracking and entering time, and tracking budgets.
- automating financial and performance report generation to significantly speed analyses and bolster fact-based decision-making
- automating notification systems to keep workflows progressing on time and prevent costly issues from slipping through cracks.
Some digital tools help lawyers capture more billable hours, while others help billing specialists speed billing cycles and payments. In every instance possible, data analytics enable you to pinpoint specific time and effort savings and identify real savings in actual dollar amounts, wherever they occur.
Pinpoint Profitability Drivers To Align It Investments With Strategic Growth Plans.
Tracking and analysing performance data shines a light on how lawyers (1) collaborate amongst themselves and with others, (2) obtain new clients and new work from existing clients, and (3) most effectively deliver various types of legal services.
As a result, you can make more appropriate choices about which technologies will help them better manage real-world complexities and reach their goals more efficiently. In-depth reporting on each office, department, client, matter, and timekeeper enables your firm to drill deeper to:
- Assess the resource costs of supporting each book of business.
- Pinpoint the firm’s most profitable clients, which are not always those who generate the most revenue
- Identify the firm’s most promising fields of work.
- Determine which clients and legal fields are growing and which are shrinking.
- Find where lawyer introductions, referrals, and work collaborations have led to new and repeat business.
- Spot new opportunities to engage existing clients in additional types of legal services.
You get clearer insight into where and when lawyers need technology tools to meet strategic growth goals and which software features would be most beneficial. These discussion points help you demonstrate to the CFO how technology helps find more opportunities to drive more profitable outcomes.
Build A 360-Degree VIEW Of The Value Technology Offers.
Just as CIOs seek to align IT investments with the firm’s strategic growth plans, those who control the checkbook also benefit from a more comprehensive view of the areas where technology creates new opportunities for gain. A few areas to discuss include how the right technology can enable the firm to:
- Build new remote capabilities such as client portals and document generation.
- Embed firm governance policies, regulatory protocols, and client guidelines into firm processes, down to individual lawyer, matter, and document levels through workflow automations and templates.
- Discover client preferences that lead to fine-tuning support and creating new service offerings.
- Model “what-if” financial scenarios based on more accurately forecasted needs.
- Make data-backed decisions on pricing and resourcing decisions that protect profits.
Explain Technological Complexities to Improve Clarity.
The role of law firm CFO continues to evolve as more law firms adopt new technologies that support remote work, eliminate productivity constraints, and enhance earning capacities. However, CFOs often do not have the same level of understanding as CIOs do of the complexities involved in issues such as:
- How, why, and where the firm needs integrations to streamline workflows,
- Managing ever-expanding regulatory guidelines, particularly regarding data privacy,
- Reducing reliance on outdated software and the growing costs to maintain them.
Be willing to discuss the factors you consider when making IT investment decisions. Show that you rely on BI and financial analytics software for non-biased, data-backed observations and prioritise the most profitable opportunities.
Use data and dashboards to express value and savings through charts and graphs. You can set up the CFOs dashboard to track the return on new investments and initiatives, making the CFO a more involved partner in the technology choices that drive more profitable results.
Law firm CIOs, CFOs, and other leaders trust Iridium for help in leading the growth and digital transformation of their firms every day. To see how Iridium BI and financial analytics products can help you achieve your top digital goals, schedule your demo now.
