Make Better Data-Driven Decisions in 2023
Gearing up for 2023? This is the time of year when law firms start charting their plans for the new year. Maybe you’ve got big goals for building out new practice areas or increasing your staffing to handle a higher client load. Or maybe you’ve identified some pain points in your practice that need attention next year.
As Q4 draws to a close, it’s a good practice to assess your goals and needs for next year. But unless you base your planning on actionable data, you risk wasting time.
Our suggestion: instead of spinning your wheels, throw your law firm into all-wheel drive by taking advantage of business intelligence reports in your practice management solution.
We’re not just saying that—this suggestion is backed by data. Businesses that use reporting and analytics software are five times more likely to reach a decision faster than companies that try to make decisions without the benefit of analytics software. That’s because business intelligence and analytics software can highlight critical KPIs, the level of productivity of team members and clients, and customizable data sets that are tailored to your law firm’s specific needs.
See how Rocket Matter can help you revolutionize your decision-making in 2023 with the powerful features of our analytics software.
Customer relationship management (CRM) software
CRM software allows you to automate workflows and create a sales funnel that helps draw the right clients to your firm. However, consumer realities are a shifting landscape, and so it’s common to have to adjust aspects of your sales funnel from time to time.
Reporting software can outline the variables that work best for your firm and those that need to be changed. For example, it can give you statistics like how many clients responded through an email-drip campaign versus signing up on your website’s interest form. If your emails aren’t bringing in any clients, then it’s time to adjust the copy or try a new marketing tactic.
Follow the results of your campaigns to see where your target audience tends to respond most. Check your reports regularly and make adjustments to ensure that your marketing dollars are being spent effectively.
Another critical piece of CRM is helping your law firm hone in on the most profitable types of clients and practice areas. One useful report Rocket Matter offers is productivity per matter. This report outlines which cases are bringing in the most revenue per hour, and which ones end up coming short. This report helps you pinpoint which types of clients you need for your target audience, so you can get the right leads in your sales funnel.
Time and expense tracking software
Time is one of your most powerful resources, so you need to make use of your time-tracking software to see how you can improve your billable hours. Consider the following tools and reports:
Billing realization rate
Your billing realization rate shows you how many hours you’ve billed for versus how many hours you’ve tracked. Seeing how many non-billable hours are required for each client or type of case you take on helps you see which ones are profitable and which ones eat up too much time and money.
The billing realization rate also helps you understand bottlenecks in your workflow, especially with non-billable hours. See which manual tasks are taking up the most time and look for automation tools in legal practice management software to speed them up.
Origination and allocation reports
When it comes to end-of-year one-on-one meetings, you want to give your staff feedback based on their performance. Origination and allocation reports in Rocket Matter help you better understand which attorneys are bringing in the most clients and remaining profitable in their work week, and which ones could improve their time management.
With these reports, you can see where their time is going (or if they aren’t tracking their time well enough) so you can help them make a plan for success in 2023.
Outlined matter budgets
Use reporting tools in Rocket Matter to create matter budgets to structure time spent on matters and provide guard rails for profitability. Set clear budgets for each matter, and then download the reports to monitor whether sticking to those budgets for each case. This can help you spot financial issues or higher-need clients before they become a problem for your firm.
Invoicing and billing software
With invoicing and billing, you want to implement systems to check your accounts receivable and ensure that it never grows too high. Download reports showing which clients haven’t paid their bills and which ones you need to follow up with. If challenges arise, be sure that you’re
implementing tools like automatic text messages and email updates to help clients pay on time, and always charge late fees. (Just make sure your policies are clearly communicated to your clients before you ever send an invoice!)
A significant way to improve your invoicing is to understand your collections realization rate. Your collections realization rate outlines the percentage of revenue you’ve collected versus the total revenue you worked, tracked, and billed for. You never want this number to fall under 90%. If it does, use Rocket Matter’s reporting software to run in-depth analytics to better understand your collection strategy.
There may be a team member who’s not checking in with late-paying clients, or there may be an invoicing error with a recurring payment. Reporting software allows you to identify these issues so you can correct them and get your collections realization rate to 100%.
Finally, you want to keep an eye on your cash flow. This ensures that your law firm can always pay your bills and employee salaries on time. If your cash flow gets too low, you can run the risk of going into debt to make ends meet. Run your cash flow report on a weekly basis so that you’re always aware of the amount in your firm’s accounts.
Make changes with confidence using Rocket Matter’s business intelligence and analytics software
Start the new year off right with robust reporting that offers advanced insights in critical areas to ensure profitability at your law firm.
With Rocket Matter, you can create:
● Origination reports to see which team members bring in the most clients and cases and break down payments to costs and fees so you understand your overhead better
● Allocation reports to track how much money each team member brings in at your firm
● Matter budgets for each matter that allow you to monitor if you’re staying within the limits
● Productivity per user to see who is tracking the most time and if it’s billable or non-billable hours
● Productivity per matter to check how much time different matters take and bill for them properly
● Collections reports to make sure every billable minute is accounted for
● And more!
Plus, Rocket Matter’s team of legal professionals can create custom-built reports to help you analyze your law firm’s KPIs. Make decisions the right way using your law firm’s data and schedule a demo or start a free trial with Rocket Matter today.