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Legal Project Management (LPM). It’s a buzzword you hear a lot in the legal industry as the “next big thing.” In fact, managing a matter as a lawyer is as old as the profession itself. What’s different now are the tools available to manage your matter more efficiently and even achieve higher profits. Properly planning a matter ahead of time will also allow you to move towards charging fixed fees, a highly desirable thing for many clients which ultimately will strengthen your relationship.
So let’s look at the profitable benefits of LPM and five tips to successfully implement.
Not every practice is right for fixed fee billing and LPM, but it is hugely beneficial for intricate matters that have many milestones and tasks. Even if you have no intention of setting a fixed fee, your firm will benefit from detailed planning. With proper implementation, your project plan means you can assess profitability before you ever start and adjust in real time if needed.
We know lawyers didn’t go to law school to learn how to run a business. But to fully appreciate the opportunity for maximum profits and large revenue growth from project planning, we’re going to ask you to put down the scales of justice and pick up the abacus.
Most other professional service industries wouldn’t think of starting a new project without first having a detailed plan. Do you think HKA Architects planned US Bank Stadium on a whim? Of course not! And while that’s an extreme example, the idea of starting a project for a client without a well thought-out, well designed plan would be completely foreign for engineers, IT professionals, architects, etc.
Attorneys can learn much from these industries about best practices for planning, managing and utilizing resources.
With LPM, attorneys can offer flat fees while at the same time ensuring profitability. Read that sentence again. That sounds like a foreign concept for many lawyers, but it is true and many progressive firms already know it. No longer do you have to look BACK at a matter to see if it’s profitable, LPM means calculating the profitability of the matter BEFORE you ever start!
Is some part of the matter taking longer than what you budgeted and throwing off the profitability? Instead of taking a loss on that research task, with LPM, you can correct the issue on the fly and ensure the matter stays profitable.
Here’s where the rubber really meets the road with LPM. Once you’ve completed several matters using LPM, you’ll start seeing where you can increase profitability of similar matters. Let’s say it took you 35 hours to complete a real estate matter. With LPM, you broke down every task and how long it took. Now this is your flat rate for similar matters. You’ll become more efficient as you repeat that matter, but you’re still charging the flat rate you established in the beginning, meaning you are now increasing the firm’s profit margin on each additional real estate matter you handle.
Profitability analysis will help your firm’s bottom line in the following ways:
It shouldn’t be forgotten the other main benefit of LPM. Client relationships. We all know that haggling over bills is the single most contentious part of the client-attorney relationship.
When you plan a matter ahead of time and are able to show your client each and every task along with how it’s budgeted, clients see the value they’re paying for. Transparency to your clients can not be emphasized enough.
Legal Project Management, when implemented properly, can become a powerful tool for your firm. With active planning and monitoring of your matters, there’s no reason your firm can’t realize higher profits and even get to the promised land of fixed fee billing. Your client relationships will also be greatly enhanced while you become more efficient as a business, allowing you to do what you do best, practice law.
Click here to download the white paper “The Profitable Benefits of Legal Project Management” and unlock all the details on how to implement these five tips.
About the Author
Scott Clasen is the director of marketing at TimeSolv Corporation, a Minnesota-based company providing leading class billing, timekeeping and project management tools for law firms since 1999. TimeSolv’s web-based platform is compatible for both PCs and Macs, and offers an iOS and Android app.
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It sucks when clients take advantage of us and don't pay their bills.January 15, 2019 0 0 0