Posted by: johnocunningham | September 19, 2014

Trends in Law Firm Value/Efficiency Initiatives

Consulting firm Altman Weil has released the results of its 2014 Law Firms in Transition Survey, highlighting some of the key initiatives that firms are undertaking to improve their efficiency, leveraging the value provided to clients per legal dollar spent.

The survey polled managing partners and chairs at more than 800 firms of 50 or more lawyers, obtaining responses from nearly 40 percent of firms and 42 percent of the largest 350 firms.

Among the interesting results from the survey are the following:

  • 61 percent of respondents are finding ways to use technology to replace human resources;
  • 60 percent are implementing knowledge management programs (for better storing, retrieval and sharing of knowledge, including but not limited to legal memos and opinions); and
  • 43 percent are offering project management training.

These are huge steps forward from where law firms were just a decade ago, and should help firms to retain clients that might otherwise be lost to lower cost alternative providers that continue to sprout up everywhere.

I was surprised, however, to discover that only 30 percent of respondents have embraced the re-engineering of work process (sometimes referred to as process improvement). Sophisticated corporate clients constantly obsess over process improvement to speed up delivery, enhance quality and reduce costs, and many that I have interviewed say that too many law firms have little or no established process for common tasks involving litigation, discovery, or transactional work.

In order to compete for clients successfully now, firms not only need to adopt process improvement, project management and technology enhancement programs, they need to track their improvements in delivery times and costs as a result of these programs. Firms also need to communicate the results of their programs, demonstrating how they can serve clients faster and more cost-effectively. They also need to communicate – to their clients and their employees – an institutional commitment to constant improvement in client service going forward. Failure to communicate results makes them invisible.

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