Law firm risk, it’s all in the data.

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Graham Moore: You work with law firms regularly. Given the number that you work with, you’ve seen lots of different examples of management information reporting systems, processes and approaches. What are some of the sort of common weaknesses that you see?

Claire Burden: A lot of the issues around practice management system data, and the way it is also combined with other data, is that in law firms accountants typically take a bunch of different reports, do lots of work in Excel, and then provide dashboards. So there’s a timeliness issue because the reports are already out of date by the time they’re printed out. They then go around to the management team who look at them and use them to make decisions. It’s a very outdated way of working when we have the ability to get a live information from practice management systems through a live dashboard. And we see lots of delays around the fact that management question a number or question the utilisation level of an element of a team and aren’t able to drill down into the level of detail. So they go back to the finance team who then have to go and do more work. It becomes this cycle of lots of time wasted, really inefficient processes, and nobody really ends up actually making better decisions in the law firm as a result.  

Graham Moore: And it is that risk, if one person builds a solution, it might work great while that person is there, and as soon as they move on, effectively, the firm has to start again from scratch. Lawyers by their nature want to query things. They want to drill down, they want to understand what’s behind the numbers. They want to question and they want to compare the number that they’ve got in their notepad in the drawer with the figure that’s coming out of the system.

Graham Moore: You’ve worked with firms using a whole host of different practice management systems and often we come across firms who think the solution is just to change the practice management system, but from your experience is that an answer?

Claire Burden: No, I don’t think so. And often, law firm leaders can sometimes forget the level of disruption and inefficiency that’s caused by a big practice management system change that can be really, really problematic. Kind of almost bring a law firm to its knees for a year or so, more or less, while it’s sorting it out. And I think everyone needs to focus on the day job and business. Also, lots of the practice management systems do have some dashboard functionality now where they have kind of limited sets of reports. But we found that those don’t necessarily do everything that law firm leaders need either, they’re just those reports that they would have previously but in a more of a dashboard form rather than thinking holistically about what the firm needs to really make decent decisions and manage teams more effectively.