Law Firm Profitability Checklist
If you run a legal practice, you want it to be profitable. And it’s not just because bringing in an impressive revenue sounds, well, impressive. It’s because profitability allows your practice to thrive. With greater profitability, you’re able to give your attorneys and legal staff the tools they need to deliver standout client service, attract exceptional talent, and scale your practice.
However, profitability, especially in a fluctuating economy, can feel like trying to hit a moving target. If you’re looking to dial in your profitability, make sure you’ve checked these items off your list.
Learn from someone more experienced than you
Even if you’ve practiced law for years, running a law firm is a unique challenge—and it’s one that’s hard to prepare for. There are some things you just can’t know until you’re a decision-maker. That’s why it’s critical to have a mentor you can go to for advice.
A mentor can help you prepare for and tackle some of the big issues you’ll run into when you’re making leadership decisions.
You can learn efficient processes and workflows so that you don’t have to start from scratch, such as tips for a smooth client intake process or bottleneck-proof billing procedures. Plus, a mentor can offer scaleable tips for growing your firm that would have taken you months or years to figure out on your own.
Set up clear avenues of communication
When employees miscommunicate, time and money are lost. For example, if two lawyers assume the other was handling client follow-up, this could mean losing business for your firm.
It’s crucial to set up clear methods of communication so that everyone knows which clients and tasks are their responsibility.
Luckily, modern legal practice management software offers helpful tools for lawyers to communicate all in one place. If you’re only using email, it’s easy to miss a message or for an inbox to get clogged. A private, internal messaging system makes it easy to quickly check in with co-workers on the status of a case or share files pertaining to their workloads.
Also, simple calendar features can keep everyone on the same page. You can set recurring meetings and add them to everyone’s calendar. This can apply to team members as well as clients—which is helpful to make sure clients don’t forget about meetings or deadlines. (An informed client, after all, helps move matters forward more efficiently!)
Keep matters organized
If you’re organizing matters by Post-It notes on your desk, it’s time to level up.
Project management software makes it easy to track your matters and assign tasks within each matter to all your employees. Implement workflows for every matter so you can automate tasks for each new matter your firm takes on. And when you set up the same process for certain types of clients, your employees will learn the system and complete their work faster.
Plus, with comprehensive dashboards, employees can check the status of the matter and see it through completion.
This makes it easy for staff to see which members could be overwhelmed and address workload issues before productivity begins to decline. This is even easier when you visualize matters with kanban boards. This online management system shows how many days a matter has been in its current status so you can quickly see what’s causing the slowdown.
Track all billable time
When you try to just track your time on your phone’s timer or using a timer in a web browser, it’s easy to miss minutes of work or accidentally forget to turn them off. Instead, use robust time-tracking software that can keep multiple timers going for you. If you switch between documents, just start a new timer in the second matter.
And when you complete a document or calendar task, the software will prompt you to add that time to your invoice. You’ll never forget to bill for a meeting or legal document again.
Make payments simpler for your clients and invoicing easier for your employees
If you don’t accept credit cards, you’re losing money.
Businesses that don’t accept online payments lose out on about $7,000 a year. And if you accept paper checks, it can take days for them to come in the mail, slowing down your cash flow and requiring more administrative work.
Help out your accounts receivable with online payments. When you use a legal payment processor alongside your practice management software, your clients can pay invoices directly from their phones.
Plus, with online payments, you can set up recurring billing. Clients don’t have to worry about accidentally paying late if the amount they owe automatically comes out of their account. On the other hand, if the client needs more time to pay, set up a payment plan so you can ensure cash flow, maintain continuity of service, and deliver a positive client experience.
When you create a consistent legal and billing workflow, the whole process becomes smoother for everyone. Automate as much as possible and implement batch billing so that your team can knock out multiple clients at once. And make sure that you have a billing cut-off date so that no invoices go out late and slow your cash flow.
Implement robust analytics
Analytics reporting tools help you organize your firm’s data to establish actionable steps for improvement. Create reports to show which team members are bringing in clients to understand who’s responsible for the most revenue and which team members may need to work harder.
You can also see which matters are costing you the most money so you can decline or refer out clients whose matters don’t fit your ideal client profile.
Boost your profitability with Rocket Matter
Make your team more profitable with Rocket Matter’s legal practice management software. Our best-of-breed software offers countless tools to maximize your resources and time, including:
- Robust time-tracking software that you can use on any device
- Comprehensive billing software with automated features to make the process faster
- Online payments so clients can pay when it’s convenient
- Legal project management features to stay organized with matters
- An internal messaging system that simplifies collaboration for teams working remotely and in-person
Plus, our U.S.-based customer service team can solve problems in hours, not days, so you’re never left stranded if a software issue comes up.
Building a profitable legal practice is easier when you’re using tools that support your goals. Learn how Rocket Matter can help you get there when you schedule a demo with Rocket Matter today.