One of the storylines that ILTA’s Business Management Content Coordinating Team will be focusing on in 2017 is the Life Cycle of a Matter. This post will kick off that story by defining the key phases we have identified as part of the Matter Life Cycle. As you can see in the infographic below, the phases we have defined are:
1) Business Pursuit
2) Client Intake
3) Delivering the Work
6) Matter Conclusion
Throughout the coming year there will be additional webinars, articles, roundtables and blog posts that dive into deeper detail around the people, process, policies and technologies within the phases. Below is a high level overview of the topics that fall under each phase:
- Business Pursuit – The process by which engagement opportunities, whether for new or existing clients, are identified, scoped, and budgeted. Identifying new work has always been seen as the domain of the Attorneys within a firm. In an effort to remain competitive, however, some firms have introduced more creative ways of pursuing business with formal processes and technology supporting that effort. New business can be developed through the traditional channels (existing clients, RFP's) and marketing efforts (external lead sources, targeted outreach to potential clients based upon research and market analysis, and internal tracking to identify cross-practice opportunities). Marketing departments and their supporting technologies are key for the contact management, lead management and RFP process management needed to support the new business pursuit. To respond to the request that clients have for predictability in pricing, many firms have begun to rely upon KM and project management expertise in an effort to accurately predict the cost of a matter, and to build financial models to ensure that the matter can be profitable.
- Client Intake –When looking to open a matter, a comprehensive conflicts check must be performed to not only vet new Clients but to mitigate a Firm's risk relating to the type of new Client, Matter or engagement they can and should accept. It is critical for the appropriate technology solutions to be in place during the New Business Intake process. These solutions should ensure that relevant data is not only captured, but disseminated and leveraged across firm software and processes (i.e. Accounting and Experience Management). The data gathered and generated in this phase is truly the back bone for the life of the matters within firm data systems – client matter numbers for time entry, fee arrangements for billing, etc. No matter should be opened until a signed Engagement letter from a client, setting the stage for the scope of work, the special considerations a client expects from their firm (i.e. information security expectations), and billing arrangements, is executed.
- Delivering the Work – This phase of the Lifecycle of a Matter will cover a large portion of the topics we will be addressing this year. During the delivery phase, a task plan and budget should be developed, which informs staffing, matter scope and resource skills, experience, availability and cost. Matter Management through eDiscovery Project Management, Legal Project Management, and Financial Analysis & Reporting will be covered from multiple aspects including tracking and managing the status of work, understanding in scope versus out of scope work and communicating Legal Matter status internally with the client and with third party vendors. There are a variety of software and technology solutions that can support work product delivery of in a matter and will be covered throughout the year as well. This will include eDiscovery software, Legal Project & Portfolio management concepts, business intelligence solutions and financial tracking and analytics tools to name a few.
- Billing - Considered one of the most critical aspects in the lifecycle of a matter, Billing represents the process from which worked fees are turned into billed fees (aka accounts receivable) and disbursements are recouped. While the advent of technology has improved the billing process dramatically, many firms would agree that there are improvements that can be made. In exploring this topic, many aspects within the billing cycle can be examined because the billing cycle is so variable in nature. As an example, there are different types of bills which are sent, from paper to electronic. While most bills are sent electronically, this type of bill presents many challenges, often times requiring dedicated staff to manage. Ensuring proper template structure is imperative. Appropriate language to use on labels and the order in which to place the sections of the bill helps clients clearly understand what is being charged and generally leads to faster payment. The frequency at which bills are sent is another important consideration. Firms that bill more frequently, not only have better cash flow but a clearer understanding of their overall financials. All aspects of the billing process must come together to operate efficiently and effectively. Examining the different aspects of the billing process can lead to dramatic improvement in the overall process.
- Collections – The process by which firms collect on overdue bills varies greatly. The fact remains that like all other businesses, collecting on overdue bills is imperative to cash flow and a sustainable business and there are creative ways to collect. As like all other phases, collections require a process. Establishing a process keeps collection attempts professional and organized. Reminder statements and emails are great tools to keep the bill in front of the client. Offering multiple ways to pay, like accepting credit cards through an online portal method, lead to faster remittance by allowing the process to remain discreet.
- Matter Conclusion – Perhaps the most overlooked aspect of the matter life cycle is the actual conclusion of the matter itself. While many firms have some type of a matter closing process, it often consists of very generic steps, such as assigning a closed file number and moving the physical file to storage. In the age of data analytics and client transparency, firms are missing significant opportunities at that this phase to not only further the relationship with the client but garner insight that could dramatically improve the overall operation of the firm. The closing process deserves as much attention as the new matter intake process, in that important information can be gleaned to improve future matter management. For instance, meeting with stakeholders to discuss lessons learned on the matter can improve the use of resources in similar matters. Analyzing the matter financial data, such as key performance indicators and other metrics, can alter the way firms price and scope similar matters in the future. Aside from extracting insight, there are other important yet menial steps to take as well, like closing the matter out in the financial system to ensure no further fees are charged and marking the matter inactive from current matter and task lists. Matter conclusion, if done effectively, provides great value and should be considered an important phase of the matter lifecycle.
This was authored by Katrina Jasaitis and myself, team members of the Business Management Content Coordinating Team.