Throughout our years working exclusively with law firms we have learned that there is not a one size fits all solution. There are many differences from firm to firm including size, type of law practiced, operational strategies, the list goes on. However, challenges law firms face seems to be one area where there is a consensus. It is also agreed that using analytics can assist in improving and significantly reducing these challenges.
Top Challenges Law Firms Face
Aderant recently released the 2017 Business of Law and Legal Technology Survey, in which they surveyed 112 respondents in U.S. firms, most of whom are in financial, accounting, or C-suite roles. The top 4 challenges the 112 respondents agreed upon are:
- Pricing Pressure (43%)
- Improving Operational Efficiency (40%)
- Winning New Business (29%)
- Growing Existing Client Business (28%)
Utilizing technology is an obvious solution to all of these challenges. The same survey also identified that both Analytics and Business Intelligence are two of the most favorable technologies that can provide law firms with the greatest overall effectiveness.
How can you use Business Intelligence and Analytics to solve these problems?
Data is crucial to a law firm, but one of the biggest issues is that there’s incredibly too much of it. This data is typically in incomprehensible formats and can be very difficult to work with. A business intelligence application will simplify a law firm’s data and make it presentable to the masses. A great business intelligence tool will make it easy for your attorneys to use!
BI and analytics provides many benefits to law firms. How can you use analytics to assist in challenges facing law firms? Check out these four steps:
1. Using BI/Analytics to improve pricing.
Analytics can help law firms explore different pricing options; standard hourly rates, AFAs, and contingency fees, etc. A pricing business intelligence solution will be able to pull data from a variety of different sources to help attorneys and administration analyze previous performance and staffing arrangements to plan for new business. You can use analytics to see how changes in different variables will impact pricing scenarios and profitability.
Not only can BI assist in the planning side, but you can also use it to track and report the results of your plans. You receive real time information comparing actual to budget/target and perform what if scenario analysis.
2. Using BI/Analytics to improve operational efficiency.
One of the greatest challenges law firms face doubles as one of the greatest opportunities- improving operational efficiency. BI applications give law firms the tools to look at a set of data in an easy-to-understand-way and drive better firm wide decisions. With the mass amounts of information firms have readily available to them, it’s important to use that to their advantage.
In this Case Study, Waller Lansden recognized that their attorney dashboard was no longer providing the features that they needed to evaluate all of the relevant information. Ultimately, their Management Team decided that it was time to find an alternative Business Intelligence solution that better fit their business model and current needs.
Giving attorneys the power to an intuitive and user friendly BI dashboard, has allowed them to be more self sufficient, which in turn freed up firm administration. Waller was eventually able to consolidate a number of systems, using just their BI software, which sequentially saved them time and money. That’s truly efficiency at its finest!
Work smarter, not harder: Deploying smarter technology helps your attorneys and administration work at their most efficient and productive level. Access to data is great, but once your staff knows what to do with it, you have the potential to change the way they perform their jobs.
3. Using BI/Analytics to win new business.
A great way to win new business is to utilize your firm’s existing data to improve marketing strategies. A business intelligence application can help you spot trends and analyze markets, allowing you to create a more focused message for your prospective clients. It is also important to look for a business intelligence application that will give you the ability to share specific dashboards and data with your client through a client extranet site. This is a huge selling point and bonus feature that law firms can use to set themselves apart from the competition.
4. Using BI/Analytics to grow existing business.
Often times a law firm’s best bet to grow their business is to look at relationships they have already established. A successful business intelligence application should be able to help you analyze existing client trends and identify areas where there may be an opportunity for cross servicing. You can use data to inform, educate, and advise your clients. The data you collect can be used to show your clients where the value lies in the services you are providing them.
Massive amounts of data are only useful if you make it easy to understand. The potential is there and rather than leaving it un-examined, take advantage of the opportunity. Law firms face challenges everyday, and having a tool in place to help you overcome obstacles and move forward with clarity will not only save money, but headaches as well. By improving pricing and operational efficiency as well as winning new business and growing old, your firm will be set up for a successful future.
BigSquare is the leading provider of Business Intelligence for law firms and professional service organizations. We focus exclusively on law firm reporting, law firm BI, law firm profitability and law firm analytics.