You get what you measure – key metrics for business savvy law firms
This common belief about key metrics also applies in the legal industry. When the focus of lawyers is strongly in the actual legal practice, clear key metrics help ensure that the company does correct things and the business develops to the desired direction. The turnover growth alone will not warm you up if – at the same time – expenses grow uncontrollably or customer satisfaction is poor.
Up-to-date key figures are crucial to the management. Based on the facts, daily operations can be effectively controlled and decisions concerning development of the business made. The key figures tell which of the practices attract customers the best, i.e. what kind of expertise should be invested in. Which of the customers are the most profitable for the office and which are the least profitable. Do we get enough new customers and who brings them. How is the invoicing rate developing in general and for individual experts.
When the key metrics are correctly selected and their monitoring is a continuous process the management learns to recognize the trends they reveal and react to them at an early stage.
However, key figures are not only a tool for the management. Meaningful and up-to-date key figures are necessary for every team and employee to perform their tasks. In addition to individual and team-specific metrics, it is good for the team to also get information about the key figures of the entire company. It improves awareness of the company’s key goals, provides an overall picture of the situation and thus enables every employee to participate in making the business results.
Choose the metrics carefully
One model does not fit all. Therefore, the selection of key metrics should always be based on the company’s goals; on the direction in which the company wants to develop and on how success is measured. Naturally, the choice is also influenced by whether the necessary information is available or whether changes to the systems will be needed to collect it.
It is essential to choose the key metrics at the company and team level in such a way that the whole setup works also in the longer term, employees have the opportunity to influence the things that are measured, and the dashboard does not attract partial optimization. For example, it may be necessary to complement the invoicing metrics with customer satisfaction to ensure the quality of the service. However, in the amount of different of key metrics less is more; too large a set of metrics will blur the perception of what is essential and what should be accomplished.
Besides turnover, it is essential to monitor the company’s profit and efficiency. The key metrics for employees and teams are naturally productivity-related because what is monitored often gets done. For example, monitoring hours worked vs. invoiced and the average hourly price effectively guides daily work of lawyers. Lawyers who are responsible for assignments need key figures, e.g. about the progress of their assignments. Similarly, managers need figures about the performance of their own team in relation to the budget.
Display the key metrics in the dashboard
Measuring and reporting of key figures are among the basic features of CSI Lawyer and, basically, all data entered into the software can also be reported. CSI Lawyer offers 40 ready-made dashboard charts, 36 pivot reports and 178 different views for viewing key figures.
Dashboards have proven to be the most effective way to communicate key metrics. They offer the figures to each user as illustrative diagrams. As e.g. the up-to-date situation of registered and invoiced transactions can be seen at a glance, the user can make checking of the key figures, for example, a morning routine.
Teams do have their own key figures, so the content of the dashboard should always be adjusted according to the user group. From the ready-made chart library, you can choose the charts that best serve the needs of, for example, a lawyer, a team leader, the person responsible for assignments, financial management or a partner. If necessary, charts can also be tailored to the specific needs of the company. The information content of the charts is always limited to what is meaningful for the user; where lawyers are mainly interested in the status of their own entries, partners want to see the metrics at the level of the entire company.
In dashboards, the continuity of measurement is essential. A comparison of the current situation with the previous week, month or financial year reveals concretely whether the business is developing in the desired direction.
Analyze and develop
In addition to ensuring operational efficiency, another and at least equally significant benefit of key figures is the learning they enable. In the light of the figures, it can be asked what could be done differently or better in the areas that are being monitored. A more detailed analysis of the figures can be achieved by drilling into the data of the interactive pivot reports, for example to find out deviations per customer or per practice group. This can lead to new practices that improve results. Or even to the realization that a certain key figure should be developed or replaced with a more appropriate one.
So, even good key metrics don’t always last forever. From the point of view of business development, however, they are valuable in clarifying the company’s long-term goals for the team and where we are on the way towards achieving them.
In case you do not have dashboards in your CSI Lawyer software, please fix it by contacting our customer support, email@example.com.
CSI Helsinki, Business Development Director, Partner
Busy with different development projects, marketing and communication. Gets motivated by continuous development of operations and customer experience and believes in light processes supporting the company’s operations.