Yesterday we held the fifth in our series of webinars around pricing, LPM, profitability and the use of technology in law firms. This installment saw our usual panelists; Mark Medice of Law Vision and Pieter van der Hoeven of Clocktimizer; joined by Barry Honea, the Chief Financial Officer of Locke Lord.
In light of the increasing challenges facing the legal industry, from the impact of COVID to changing risk sharing arrangements with clients, we focused on pricing strategies for 2021. Our panelists shared their tips for setting it up, how to invest in technology to support good pricing choices, and best practices. For those unable to attend, we've put together a quick wrap-up with all their best advice.
Has the pandemic shifted the focus of the legal world?
We kicked off our webinar with a poll, focusing on the impact of the pandemic on firm strategy. The results were a solid indication that longer term strategy is still relatively static, even with the pandemic as a driver.
43% of attendees shared that they are now back on track to continue with their pre-COVID strategy. A further 25% were more focused on profitability. For our panelists, this indicated a number of things. Having spoken to C-Suite executives before the webinar, Pieter shared that most had experienced change fatigue. The push to implement more and more new things as a result of COVID, meant many were happy to return to the firm's original direction as soon as possible.
For Barry, it also reflected the success of many firms' adaptation to the challenges of working from home. IT departments have been able to roll out software solutions to the challenges so effectively that it has allowed much of business to return to usual. Importantly, working from home has also enabled his firm to focus on better data sharing practices. Because it is no longer feasible to sit next to other executives and explain numbers on spreadsheets, Locke Lord has invested in an Executive Information System. This will deliver essential insights like the difference in time spent on matters pre-pandemic and now.
Finally, Mark noted that one of the key things the pandemic has done is realign IT project expectations. Firms have managed to implement new technologies firm wide in two weeks, which would have been planned for delivery over two years, pre-COVID. Clearly, where technology is designed to be easy to implement (like Zoom, Slack or Clocktimizer) it is realistic for these projects to be up and running in weeks, not years.
Better technology for pitching pricing and scoping
One of the most exciting things to hear about (especially for us at Clocktimizer!) was how intrinsic our platform has been for Locke Lord. In Barry's own words
'Clocktimizer is the tool of choice to bring meaning out of the data, and has been the most impactful on pitching pricing and scoping. We piloted it with some of our most important matters and will roll it out completely at the beginning of 2021.'Barry Honea, CFO at Locke Lord
For Locke Lord, setting pricing strategies in 2021 will be about how they share data with their attorneys, to enable them to make the best decisions. They will do this in a number of key ways:
- Use Clocktimizer as a project management tool - for Barry, project management is key to ensuring profitability. His firms uses Clocktimizer to automate the work that a PM would usually have to manually oversee.
- Share data with attorneys - By using Clocktimizer analysis tools with attorneys, Locke Lord has given better insights into what works and what doesn't. Their attorneys are now excited to compare groups of matters to identify what works and what doesn't. It means better pricing choices for the client and the firm.
- Analyse at the activity level - Because Clocktimizer breaks down matters into activities (by using NLP on the narratives) Locke Lord is able to analyse which activities are most profitable for the firm. It allows them to tailor their pricing strategies uniquely, and offer more sophisticated fixed fees.
Which projects have priority for firms in 2021?
The second of our webinar polls looked to the future. We asked what firms are prioritising among pricing strategies for 2021.
Unsurprisingly, the vast majority of firms (65%) shared that their focus was on multiple projects. This was unsurprising for our panelists, however they were able to share some light on the interrelated nature of these goals.
For Pieter, who spoke to a C-Suite executive about this very problem before the webinar, the key here is identifying the cost of production. If you can effectively identify what the costs associated with a matter actually are, then you can price accordingly. Barry agreed, taking the point further. Many firms will already have some idea of their cost of production, but it can always be more sophisticated. For that firms need to look into granular activity data.
Our panelists' takeaways
In the wrap up to our session, our panelists shared a number of key ways to ensure your firm can set an effective strategy for 2021.
- Unlock the data in your narratives - for Locke Lord, one of the most effective ways of getting better data insights has been in using Clocktimizer to analyse their narratives. This has more accurate data than codes and has allowed better analysis of cost of production for pricing
- Get the right data in front of the right person - Putting the right analysis at the hands of the right person can be the difference between winning and losing a client. If you can show real, understandable pricing breakdowns, and let clients have a say in what they want to prioritise (and can do without) in their fees, you can increase collaboration and client retention.
- Empower your attorneys - It isn't good enough to rely on last year's data to set next year's trends. You need to give your attorneys the tools they need to set sustainable pricing choices. Offering Clocktimizer allows them to make more tailored pricing for clients which is guaranteed to be good for your bottom line.
Recognise that tech roll outs can be speedy - Finally, the ability of IT departments to roll-out technology firm wide in a couple of weeks has let the cat out of the bag. IT projects can be fast and agile in firms. So use that potential and get testing new products!
Interested in learning what Clocktimizer can do for your firm?Book a demotoday!
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