BOOK
Sustainable Profitability in a Disrupted Legal Market
Norman Clark | Lisa Walker Johnson
(2019)
Additional Information
Book Details
Abstract
Profitability in law firms is, above all, about change. This special report presents practical strategies for law firms to protect and sustain their financial performance and profitability as changing client expectations, advanced technology, and global competitive forces are fundamentally changing the legal services industry. The authors demonstrate how the traditional factors influencing profitability remain valid, but must be adapted to new financial realities. The report focuses not only on what sustainable profitability means, but also how to achieve it in any law firm. Sustainable profitability demands more than closer attention to the numbers, but also new approaches to managing the profound changes in the way that law firms traditionally have worked.
Table of Contents
| Section Title | Page | Action | Price |
|---|---|---|---|
| Cover | Cover | ||
| Title Page | 1 | ||
| Copyright Page | 2 | ||
| Table of Contents | 3 | ||
| Seismic shifts in the legal services industry | 7 | ||
| 1. Introduction | 7 | ||
| 2. Will the law firm of the future be a computer? | 7 | ||
| 3. A diagnostic approach | 11 | ||
| The six classic drivers | 13 | ||
| 1. Introduction | 13 | ||
| 2. Old questions turned upside down | 13 | ||
| 3. Diagnostic tools in a change-ready professional culture | 20 | ||
| Pricing – classic driver | 21 | ||
| 1. A thought experiment: £10 per hour | 21 | ||
| 2. Are your fees low enough to be competitive and high enough to be profitable? | 22 | ||
| 3. Low pricing: an unsustainable strategy | 23 | ||
| 4. Are your fees high enough? | 25 | ||
| 5. Value, not price | 27 | ||
| 6. An agenda for a value conversation | 29 | ||
| 7. Escaping the squeeze | 32 | ||
| Productivity – classic driver | 33 | ||
| 1. A thought experiment: the 80-hour day | 33 | ||
| 2. Are you working too hard? | 33 | ||
| 3. Is the billable hour obsolete? | 34 | ||
| 4. What is the magic number? | 36 | ||
| 5. Variation in productivity | 38 | ||
| 6. The overproductive partner | 39 | ||
| 7. Moving beyond the billable hour | 43 | ||
| 8. Disruptive productivity | 44 | ||
| Realisation – classic driver | 47 | ||
| 1. A thought experiment: collecting every penny | 47 | ||
| 2. Leaving money in the street | 47 | ||
| 3. Realisation as a diagnostic indicator | 53 | ||
| 4. Better profits through better realisation | 55 | ||
| Cost management – classic driver | 57 | ||
| 1. A thought experiment: operating a law firm for £50 per hour | 57 | ||
| 2. Cost management in context | 58 | ||
| 3. The temptation to slash costs | 59 | ||
| 4. Pitfall number 1: not knowing what it costs to produce a legal service | 60 | ||
| 5. Pitfall number 2: overinvestment in multiple offices | 63 | ||
| 6. Pitfall number 3: not keeping up with the technology | 65 | ||
| 7. Pitfall number 4: ignoring partner performance issues | 65 | ||
| 8. Pitfall number 5: slashing costs without managing risks | 66 | ||
| Staff compensation – classic driver | 69 | ||
| 1. A thought experiment: associate compensation in 2030? | 69 | ||
| 2. Are associates becoming inherently unprofitable? | 69 | ||
| 3. Looking through the wrong end of the telescope | 71 | ||
| 4. It’s not about the money | 72 | ||
| 5. Improving associate profitability now | 73 | ||
| 6. Money into the bottomless pit | 75 | ||
| Leverage – classic driver | 77 | ||
| 1. A thought experiment: 40-to-1 leverage? | 77 | ||
| 2. Finding the fulcrum | 78 | ||
| 3. Technology, workflow leverage and the future of the law firm | 82 | ||
| Being the change | 83 | ||
| 1. Introduction | 83 | ||
| 2. Change-challenged or change-ready? | 84 | ||
| 3. Paradigm shifts in the legal services industry | 95 | ||
| 4. Is your law firm trudging silently towards oblivion? | 99 | ||
| 5. Playing a poor hand well | 100 | ||
| Notes | 101 | ||
| About the authors | 103 |