To stay competitive, you must be able to quickly access information from critical systems and view it in a meaningful way.  BI software lets you do it—without custom programming—by proactively pulling information from your existing data repositories and pushing it in a practical format for users to analyze and use to support business decisions and strategy development.  You can, for example, evaluate the success of branch offices, as well as compare actual numbers to budget numbers.  

Two ways this software can help you better manage and grow your practice are:

Measuring Profitability.  A CFO can identify both the most profitable areas to the firm and least profitable clients by:

Measuring billing realization quarterly by matter area of law and comparing that to cash receipts realization
Examining average rate by quarter for each area of law
Examining each attorney’s average rate
Examining accounts receivable write-offs by area of law and clients
Aiding decision-making about resource allocation and whether to adjust new matter intake rates for these clients

Measuring Productivity.  A managing partner can identify attorneys who aren’t as profitable as the firm average by:

Analyzing hours produced

Comparing those hours to others at the same level and by practice area

Examining the average billing rate and average accounts receivable write-offs

Working with attorneys to identify and resolve productivity issues

If asked to look at BI software, first list the analyses/reports your firm uses, including information you haven’t been able to provide.  Learn firm goals and the information required to make business decisions to support them.  Determine how users wish to receive/view the data.  Ask colleagues at other firms about their vendors and toolsets, contact their clients to assess satisfaction.  Explore the BI vendor’s reputation, clients, similarity of those firms’ needs to yours, product stability, features/functionalities and ease of use.  At a minimum, a vendor should provide:

Dedicated SQL server database via a “data cube” design for optimal performance

Simple analysis via drag-and-drop for the casual user
Report templates and on-the-fly analyses

Excel reports, including Pivot Tables and charts
Automatically generated e-mail reports to firm-defined distribution lists

Attorney and partner inquiry screens for reviewing personal statistics

Microsoft Digital Dashboard integration for information snapshots

Remote user access via Citrix, firm portal or the Web

Integration with the firm’s key system

Flexibility to customize fields and formats as needed, with no custom programming required

BI software is an affordable option for leveraging existing firm information in new ways for better practice management and informed decision-making—and one more way of helping you stay competitive.  

About our author ...

Jim Hammond, President of RainMaker Software Inc., has more than 20 years of law firm software experience.  RainMaker provides large law firms with proven and practical financial management, practice management and business intelligence software.  He can be reached at jhammond@rainmakerlegal.com.