If you’re in a small or mid-sized legal firm today, you can bemoan the changes taking place across the industry that challenge your work. Changes like shifting pricing paradigms. Uneven resource allocation. The threat of big firms and virtual legal services. You could wring your hands about it, or you could scale these phenomena to your advantage and adapt in order to produce the highest quality work in the industry. How? By embracing efficiency.
Only So Many Hours in a Day
Chances are, you’ve heard the news: “Billable Hour World” is shrinking. Alternative fee arrangements (AFAs) are taking hold, and with them, a new model for efficiency: “the right AFA structure motivates firms to maximize productivity,” Ron Friedmann says.
Driving this shift is industry-wide pressure from clients to lower prices. For big law, that means absorbing change. For your smaller firm, though, this shift can be costly. You’re adopting a new pricing structure and are forced to compete not just with bigger rivals, but also with web-based services. So, how can your small firm scale the success of large ones to stay competitive?
First, Do Some Research
Adapting to AFA legal services means working more efficiently and, most importantly, using technology to your advantage. There are so many tools out there that the options can be overwhelming.
First, find the right ones to fit your needs.
Second, train your team to use them effectively.
Third, use those tools to drill down into useful analytics and meaningful metrics to measure productivity.
By making a few smart decisions, small shops can use technology, and the same services that threaten business, to create success.
Next, Know Your Competition
You know this already: small shops will never be able to compete with the resources that big firms have always had. Office space is likely to be one of your most costly expenses. Maybe LexisNexis isn’t in your budget. Maybe minute-long television commercials aren’t either. Or you can’t afford an assistant (That’s ok).
Altman Weil’s 2014 Law Firms in Transition survey shows that you’re not alone. Whether you’re still billing hourly or you’re in the 95% of firms offering AFAs, these non-billable tasks are preventing you from getting your work done.
Then, Take a Step Back
Infusing your firm with a few efficient practices can make all the difference here, freeing you up to do your job. You can use technology, the very thing that’s driving your competition, to your distinct advantage. So-called “efficiency killers” are dangerous, so embracing technology in your workflow is key.
Loretta Rupert has some great suggestions for legal-specific technology that’s in your budget. These scalable tools can measure your output and integrate billing and accounting, adding value to your work. Reducing paper-driven processes is an efficient move, both for you and your clients.
There are also other ways to run an office: how about remotely or as part of a shared working space? And leveraging technology will open an entirely new advertising sector on the web and through social media, which are more popular than ever.
The Stakes Are Higher Than Ever
Each of the clients that a firm serves is important. But your small shop means that you can only accommodate so many clients at a time. Being more efficient will serve not only you but also your clients. “Clients today are in the driver’s seat – asking law firms to provide more value at reduced cost,” says Frederick J. Esposito, Jr.
Where small- and medium-sized law firms can soar is in their position to simultaneously leverage technology and provide personal, exceptional service. A client-centric model means adopting (and using) AFAs, measuring progress, handling billing and accounting procedures with ease, and embracing technology without allowing it to overpower your skills as an innovative and insightful lawyer. What’s good for the client is good for the firm, and your success is theirs.