Monthly Archives: June 2011

Making the right decisons on PMS?

Improving the use and outputs from practice management systems is increasingly on the agenda, where we can streamline the review and selection process (allowing the in house team to get on with their work, making sure their views are heard) and help senior management to make sound decisions relatively quickly with confidence because we start with knowledge and experience with a wide variety of  potential options.  This recent response to an enquiry from an IT Director will give you a feel for how we operate to support IT Directors and Managers in developing the business case when considering a change of  Practice Management System (PMS).  

” … we aim to develop an interactive working relationship with you and your team.

Our approach varies from firm to firm depending on resources and skills available and the current environment in the firm.  For example, the extent to which the project also involves change management; helping lawyers and support staff who use the systems to be a part of the selection process, so they have a better understanding and take more ownership of the systems that arrive on their desk.  Sometimes it is needed; other times it is not – but also, sometimes partners are prepared to pay for it; other times they are not.  Variations also relate to the extent of detail wanted in evaluating the tender responses (to generate like-for-like costings and scoring of solutions as an aid to making decisions) – and the extent to which we are involved in managing the demonstration process.  Also the extent to which you need to develop a business case to justify the investment in different areas of the business.

A staged approach is usually best, within a framework with timescales to work to.  Key stages are:

  1. Evaluation of the current situation and requirements, involving interviews with people at all levels – the extent of this varies, with politics often playing a part in how this can be used to maximum effect.
  2. We can develop the business case/s to justify a) investment and b) a defined level of investment
  3. There will generally be discussions at this stage about IT strategy, exploring options to improve productivity and returns from IT investment generally.  
  4. Identification of potential (infrastructure and) applications providers – with preliminary discussions 
  5. Development of a specification of requirements (level of detail varies and a more pragmatic approach can include a focus on key differentiators)
  6. Demonstrations where our involvement varies
  7. Evaluation of tenders – generating like for like numbers can be a challenge – filling gaps, advising on best options based on user feedback etc
  8. Shortlisting – presenting the business case to the management board if needed 
  9. Negotiations 
  10. Involvement in some aspects of project management if needed

However, the first stage is to get in and do a preliminary evaluation of the current situation and requirements – so we can begin to consider options.  In some cases our role in selection can stop there if any particular route is a “no brainer” in which case we focus on helping manage a transition.

The team here gives you access to the best range of appropriate expertise would involve Damian Griffiths (strategic), Allan Carton (user requirements and supplier options) and Richard Blasdale (detailed analysis and evaluation). “

If you are considering your options on developing your IT systems (PMS and beyond) and have any questions, call Allan Carton on 061 929 8355 for a preliminary discussion, with no obligation.

How to raise £3.6m to invest in legal services … today

There’s not much that is really new in this proposition but it shows what you can do with a clear strategy that others can buy into, decent technology and a determined team with the rights skills and contacts.  A proven track record and a profile in the sector helps too of course.

The founder of leading property website Rightmove has launched a new venture on the Alternative Investment Market (AIM).  In-Deed Online, a property-linked legal company, has been established by Barnsley-born Harry Hill. – where around £3m was raised by the business pre-flotation and a further £1.6m is being raised through the sale of shares.

The company aims to make it easier for people buying or selling their homes by taking the hassle out of residential conveyancing.  Customers will pay a set fee for the service, with In-Deed Online’s law firm partners taking a cut of every transaction.

The conveyancing service will delivered by a panel of law firms whose standards will be carefully monitored by In-Deed Online.  Mr Hill, who was also chief executive of Countrywide when when it was taken private by Apollo for £1.15bn in 2008, believes the In-Deed Online services will offer greater transparency than other companies offering the same service.

Mr Hill will be chairman of the company which he has established with former 3i partner Peter Gordon, who will be managing director.  The company is aiming to grow through establishing the In-Deed brand as a trusted source of business-to-consumer legal services, by reaching target markets through digital media channels, and maintaining and growing its panel of legal firms.

If you are considering a new strategy for your legal business, our team can probably help you refine and develop the proposition.  Allan Carton

Pro-active lawyers asking for client input set themselves head and shoulders above the competition

Darren Francis, Inpractice UK

Darren Francis, Inpractice UK

Statistics from Canada and the US show that many law firms don’t make client feedback a priority.  A Legal Marketing Association (LMA) survey revealed that only 10% of the Canadian and US law firms that responded consider client feedback their top priority, while 20% rank feedback as their lowest priority. This is pretty consistent with the study’s 2008 findings (9% and 26%).

Canadian Lawyers’ more recent survey of 60 general counsels found that 72% had not been asked by their top law firms to participate in a client satisfaction survey.   Surveyed clients report that firms that ask for input and act on results set themselves head and shoulders above the competition.

If you want to get closer to your key clients and set up a really effective key account management programme to capitalise where other firms are not working hard enough, contact Darren Francis or Allan Carton on 0161 929 8355.

4 simple, proven steps to generate more profit from your practice … quickly.

Andrew Taylor, financial management, law firm, business improvement, merger

Andrew Taylor, Inpractice UK

This short article focuses on just 4 fundamental areas of sound financial management that enable us to help law firms generate more profit from the work they already handle in the business; the best starting point to develop a plan to improve the firm’s performance, without the need to generate new business.

  1. Prepare a Funds Flow Statement. Profit and cash are different things – cash is entirely dependent on profit. To start understanding your business better, we complete a simple exercise to reveal what happened to the cash between two dates, e.g. between last year end and this, in a Fund Flow statement. It quickly reconciles profit to cash and the movements in the bank balance. It takes into account such things as whether more cash is locked-up in WIP and debt than last year, the movements in how much you have “borrowed” from suppliers by taking credit from them and, importantly, it accounts for how much partners have drawn.
  2. Track working capital. It’s not how much you bill or how much profit you make, but how well you manage Working Capital (and cash) that will determine whether you survive in the current economic climate. Profit Per Equity Partner (PEP) is interesting, but it has little to do with staying afloat when cash is running out. Being armed with where your cash went last year, is only a starting point to understanding and managing the daily dynamics of your business.Working Capital – the difference between current assets (WIP, debtors and cash) and current liabilities (creditors (including VAT), overdrafts and short term loans is a measure of whether you have enough cash (or potential sources of cash) to meet your payments, such as salaries, rent and VAT, as they fall due.
  3. Focus on Lock Up. Managing lock-up is not just the responsibility of the accounts department. It’s up to partners and fee earners to take responsibility for billing and debt collection and this needs to become a major element of monthly Key Performance Indicators (KPIs) and of the appraisal process. Here’s a simple example of the impact an improvement in lock-up can bring: A firm with a turnover of £6m has WIP and debt totalling £2.5m. This represents about 150 days of turnover – so on average, this firm carrying out work on 1st April won’t get paid until 1st September. If the firm can improve its lock-up by (say) 30 days, the cash position can potentially be improved by £500,000!
  4. Develop a structured set of KPIs relevant for the practice and for individual departments. Lots of firms have a “monthly reporting pack” that can be anything from 20 to 50 pages thick, that contains the key information you need, but because of the volume, it’s invisible! These firms suffer from information overload and “analysis paralysis”, leading to poor management through a lack of focus on what’s really important. These reports should be tabulated on only a few sheets of A4. Other measures should be included where they are significant and relevant for particular types of work. For example. firms with PI departments might include reports on disbursements and CFA success rates and fees achieved. Anything else can be run on an as-needed basis, perhaps to drill down to the cause of a specific problem.

The added value that can be gained from implementing measures as simple as these can is easily measured – they usually result in the business having more cash available! This article has highlighted only a few simple things that can quickly make a difference. Future articles will focus on profit improvement exercises, productivity measures, the continued need for time recording (especially in a fixed-fee environment), budgeting and forecasting, more on cashflow management and a more in-depth look at KPIs and how to use them.

For more information about our practice improvement reviews and half-day partner workshops, contact Andrew Taylor, Inpractice UK

Co-op Legal launches trial in bank branches

ABS, Alternative Business StructuresIf I were a lawyer in practice in Bristol, I’d be sending someone in to get a feel for how the Co-op are handling this ….

THE Co-operative Group is trialling the delivery of legal services through its bank branches, ahead of major changes in the market this year.  The pilot scheme, in three branches in Bristol, is being led The Co-operative Legal Services which has teamed up with sister co-operative Financial Services (CFS), to assess how legal advice can be delivered. 

It will offer free legal advice to consumers who drop-in and to those who want an appointment. The results will then be analysed and used to help CLS mould its future strategy.  Eddie Ryan, managing director of CLS, said: “Later this year the Legal Services Act will radically change the way in which solicitor services are delivered in England and Wales.  “The shake-up that the new Act offers is absolutely necessary if legal services are to become more accessible to customers. Many people feel that solicitors communicate with them poorly, use jargon that is confusing and don’t understand how services are priced.

“We believe that the presence of the Co-operative’s trusted brand in the market place, together with our combination of first class products and services, provides customers with both greater accessibility and better value for money.”

Rob Bulmer managing director, retail, at CFS added: “There are more than 300 branches of Britannia and The Co-operative Bank across the UK, so this pilot scheme will enable us to assess how legal services can be delivered on the high street. If successful, there is clearly great potential to bring these services under one roof.”

Launched in 2006 Co-operative Legal Services employs more than 380 staff, who offer legal help and advice on personal injury claims, will writing, probate and estate administration, conveyancing and employment law.