When the pandemic hit, many law firms expanded their digital systems as they sought to improve process efficiencies and incorporate cost-saving measures. Now, firms will look to grow revenue and protect profits as the global economy rebounds. That requires building more connections among your firm’s people, processes, and data to uncover any financial blind spots and fill any efficiency gaps. Embrace the following four recent legal trends, and you will unlock opportunities to help your law firm thrive in the post-pandemic legal landscape.
1. Increased adoption of technology and data analytics.
Law firms were already heavily invested in digital systems before COVID. The pandemic accelerated the transformation to such an extent that 84% of law firms plan to increase their technology investment this year, and 72% of large firms identified using technology to cut costs as a priority in 2021.
Law firms acquire data analytics tools to uncover opportunities to increase revenue and protect profits. In a 2020 legal analytics survey, two-thirds of law firms that already used legal analytics tools reported having increased their use over the prior year. Almost all firms (98%) said legal analytics improved their law firm’s performance, and 92% planned to increase their use of legal analytics in the coming year.
Data connected to context provides actionable insights to help you spot and shore up revenue leaks and address performance issues as they occur. 91%percent of businesses agree that extracting valuable insights from data will be more important than ever before. Data analytics enhance your ability to make evidence-based decisions regarding strategies to reduce expenses, increase operational efficiencies, and build out the firm’s most profitable practice areas.
2. A stronger focus on bill collections.
Law firms made a more significant push for bill collections around mid-2020, often sending bills more frequently while partners kept in regular touch with their clients and flagged payment issues early for swift management. Their efforts resulted in a direct positive impact on revenue. Other law firms noticed. Nearly half (47%) of large firm business leaders said implementing tighter credit controls for clients will be a priority in 2021.
Using electronic prebill software speeds prebill reviews, edits, and approvals and results in more accurate invoices that are less likely to be rejected or written off. Your clients receive detailed invoices in the digital format they prefer, so your firm receives the faster payments you prefer. Passive time capture tools, running in the background during your timekeepers’ daily activities, ensure all billable hours are captured, and improve total billings. Adopting the use of role-based dashboards keeps billing partners in the loop to improve client communications, and automated alerts notify AR personnel the instant invoices become overdue. With less revenue designated as “uncollected,” your firm can forecast more accurate profitability assessments and make more informed decisions about the future.
3. Embracing remote work and ensuring WFH productivity.
Lawyers and staff will continue to work outside the office as much as or more than in it. Firm leaders must conduct impact assessments on the effects of remote work—the more detailed, the better. Ensuring success is a multi-layered endeavor, starting with in-depth analyses of BI and financial data.
For example, pinpointing discrepancies in the productivity rates of in-office and remote workers can help you determine how to drive remote work efficiencies and improve productivity. Implementing easy-to-use dashboards help lawyers independently track their work and productivity rates. As a result, you increase lawyer engagement firm-wide while lawyers keep their focus on the metrics that matter to your firm’s bottom line.
Keeping pace with today’s workplace evolution will also require more accessible, modernized timekeeping software. Automated time capture capabilities typically record 8-10 more billable hours a month per timekeeper than manual time entry. The software follows fee earners’ digital work trails to automatically generate daily timesheets with entries containing the proper date, time spent, client and matter numbers, consistently worded narratives, and LEDES designations. You help increase the number of billable hours recorded while freeing up time for lawyers to earn more of them.
4. It’s all about making your processes more efficient.
Process improvements allowed firms to stay up-to-the-minute on must-do tasks amid the chaos of the pandemic. Law firm leaders will continue to focus on making underlying workflows and processes more efficient. Looking at each step of an activity helps you determine where technology can eliminate redundant and unnecessary tasks and alleviate bottlenecks. Closer scrutiny into your workflows will also reveal high-volume, repetitive tasks that can be automated to accelerate processes and reduce the potential for costly errors.
Off-the-shelf legal tools tend to force law firms into one rigid way of automating tasks. The software’s inherent limitations stunt your automation opportunities now and in the future. When you partner with a flexible financial analytics and automated solutions provider, you can delve deeper into your processes and adapt your automations to fit your firm’s specific needs and culture. You can customize automated processes to consolidate data from various sources, create and send the detailed reports your decision-makers need, and send alerts to notify stakeholders to ensure timely actions—all completed without human intervention.
Thrive in a post-pandemic digital landscape.
The pandemic accelerated legal industry trends that will continue to evolve long into our digital era. Firms that invest in data analytics and develop more efficient, modern processes are better prepared to always stay in the know and discover insights on how to dedicate their resources to the most beneficial endeavors. Learn how our products can help your firm thrive throughout this era of digital transformation and beyond. Schedule a demo with us today.