Law firm billing is more than just an administrative function. It's also the engine that drives profitability, sustainability, and client trust. The way a firm bills its clients can impact everything from cash flow to client retention, but it’s not always a straightforward process. Thankfully, organized processes, technology, and automation can help your firm develop a workflow that’s best for your staff and clients.
So whether you're refining your current billing processes or building a system from the ground up, understanding the ins and outs of law firm billing is essential for your firm’s success. This guide will walk you through the most common billing models, best practices for accurate and efficient billing, and the tools that modern firms are using to get paid faster and with less friction.
Main Takeaways
Law firm billing structures vary by practice type and client needs, with hourly, flat fee, contingency, and retainer-based models being the most common. Each type offers various advantages depending on your practice area and client needs.
Billing best practices, including detailed invoicing, automated time-tracking, and flexible payment options, can improve your billing efficiency and cash flow.
Setting the right rates requires balancing market benchmarks with overhead costs and client expectations and reviewing your pricing strategy regularly.
Legal invoices must meet compliance standards and be professionally presented to foster trust.
Law firm billing is the structured processes and systems used to track, record, and charge clients for legal services rendered and expenses incurred. This includes time tracking, invoicing, payment collection, and ensuring compliance with ethical and regulatory guidelines. Done right, law firm billing goes beyond charging clients to enhance the entire client experience and provide the financial backbone of a law firm.
Types of Billing Structures Used by Law Firms
Different types of legal work call for different billing approaches. Law firms choose billing structures based on the nature of the case, the client's needs, and the predictability of the workload. Each structure has its own advantages and is better suited for certain practice areas or matter types.
Hourly Billing
Hourly billing is the most traditional and widely used model in the legal industry. Attorneys and staff track their time spent on client matters in increments (typically six-minute intervals) and charge clients based on predetermined hourly rates. This model works well for complex litigation, corporate matters, or cases where the scope of work is difficult to predict in advance. But, it can lead to client concerns about transparency or escalating costs.
Flat Fees
Flat fee billing involves charging a predetermined amount for a specific service, regardless of the time it takes to complete. This model is commonly used for routine, predictable legal matters like drafting wills, forming LLCs, or handling uncontested divorces where the work involved is fairly standardized. Flat fee billing enhances pricing predictability for clients and reduces billing disputes.
Contingency Fees
Under contingency fee arrangements, clients pay only if the firm wins the case, typically as a percentage of the settlement or judgment amount in personal injury or other litigation cases. This structure aligns the attorney's and the client's interests, making legal services accessible to clients who couldn't otherwise afford representation; however, it also requires firms to bear the financial risk of the case.
Retainer-Based Billing
With retainer-based billing, clients make advance payments to secure legal services for ongoing or future work. These funds are typically held in a trust account and drawn against as services are performed. Retainer arrangements offer predictable revenue for firms and are often used for corporate clients or ongoing advisory relationships.
Best Practices for Law Firm Billing
Adopting law firm billing best practices increases operational efficiency, fosters client trust and reduces the chance of payment delays or disputes. The following can establish a strong billing practice for your firm.
Develop Transparent & Detailed Invoices
Clients expect clear, easy-to-understand invoices that reflect the value of the services provided. Each invoice should include itemized charges with descriptive time entries to ensure clients know exactly what they're paying for. This level of transparency reduces disputes, builds trust, reinforces your firm’s brand, and increases the likelihood of your clients paying promptly.
Streamline the Billing Workflow
Automating manual billing processes through software that integrates with timekeeping, matter management, and accounting minimizes manual work and errors. Once you have a standardized workflow with clear responsibilities for time entry, pre-bill review, and invoice distribution, the legal billing software creates a seamless system from time entry to invoice generation to approvals and improves your firm’s cash flow and profitability.
Optimize Tracking of Billable Hours
Accurate time tracking is crucial to capture all billable work, maximize revenue, and ensure fair billing. Implement user-friendly digital tools so attorneys can log time in the moment, which avoids delays in time entry, helps capture more billable hours, and improves the accuracy of invoices. Advanced technology solutions with automated time capture can even help attorneys reclaim previously unbilled time spent on emails, calls, and document preparation.
Ensure Compliance with Legal Billing Guidelines
Firms must adhere to industry regulations, client-specific billing rules, and jurisdictional requirements to maintain ethical billing practices. Legal billing guidelines, such as Uniform Task-Based Management System (UTBMS) codes and LEDES formats, ensure billing data is consistent and auditable. Audit your billing practices regularly to help identify compliance issues before they become problems with clients or regulatory bodies, because non-compliance can lead to rejected invoices and reputational damage for your firm.
Offer Flexible Payment Options
Clients today expect the same payment convenience from their law firm that they receive from other service providers. Offering multiple payment methods including credit card, ACH, and payment plans enhances this convenience for clients and accelerates your collection rate. And offering flexible payment options demonstrates your responsiveness to client needs and supports long-term client relationships.
How to Set Your Law Firm’s Rates
Determining the right pricing structure for your legal services is key to maintaining profitability, competitiveness, and transparency. It’s a process that requires balancing market expectations, firm costs, and value delivered to clients.
Understand Market Benchmarks
Start with a thorough analysis of what similar firms in your area and practice specialty (or specialties) are charging by reviewing industry surveys and reports and collecting data on your competitors. Benchmarking against local and national data gives you the context needed to help you avoid underpricing or overpricing your services and positions your firm strategically.
You should also review your firm’s internal data to ensure billing rates are appropriate for different case types, attorneys’ time is being used effectively, and each practice area is as profitable as possible.
Factor in Firm Overhead Costs
To set sustainable rates, firms must consider their cost structure, including rent, staff compensation, malpractice insurance, and software subscriptions. Understanding your overhead ensures your rates cover expenses while generating profit. Your billing rates must cover both direct attorney time and the proportional overhead expenses required to operate your firm.
Determine Hourly vs. Alternative Fee Arrangements
Evaluate whether to use hourly rates, flat fees, or contingency models based on the predictability and complexity of each matter type. Practice areas with highly variable scope (like complex litigation) may benefit from hourly billing, while routine matters (like estate planning) might be better suited for flat fees.
Customize Rates for Clients and Matters
Offering alternative fee arrangements can improve client satisfaction and differentiate your firm from competitors. Tailor your pricing based on the unique attributes of each matter or client. High-volume clients or long-term partnerships may warrant discounted rates, while complex litigation might justify premium pricing. This type of strategic pricing can optimize value for your clients and profitability for your firm.
Regularly Review and Adjust Rates
Rates shouldn’t remain static. Monitor inflation, economic trends, and changes in your service delivery model. An annual review allows you to adjust pricing strategically and communicate value to clients.
Key Legal Invoice Requirements
Compliant and professional invoices help law firms get paid faster and reduce the risk of client dissatisfaction or audits. Consider the following best practices.
Essential Invoice Components
Client and matter information
Service date(s)
Timekeeper name and role
Description of tasks performed
Time spent on each task
Hourly rates or agreed-upon fees
Subtotals and totals
Payment terms and due date
Compliance with Legal Billing Guidelines
Clear and consistent billing reduces the likelihood of disputes and ensures smoother payment processing.
Invoices should meet state bar regulations and client-specific requirements, including the use of approved task codes and formats and detailed activity descriptions. If you’re working with insurance defense or corporate clients, familiarize yourself with their outside counsel guidelines, which may dictate specific formatting, coding systems, and billing practices.
Standardized Invoice Presentation
Using a consistent template across all invoices reinforces professionalism and brand identity and reduces confusion for clients. Create a standardized process for preparing and reviewing invoices to ensure all necessary elements are included and properly formatted before delivering them to clients. A uniform format helps clients understand and pay invoices more easily, decreasing administrative back-and-forth.
Common Legal Billing Challenges
Legal billing challenges commonly stem from overburdened staff who are pulled in multiple, non-revenue-generating directions. Here’s a look at a few of the most common challenges related to law firm billing.
Inefficiency and Lost Time
Manual data entry, redundant workflows, and disconnected systems can easily drain staff time and reduce productivity. Re-entering information across spreadsheets, paper forms, and billing tools is tedious and increases the risk of errors and delays. But integrated software that syncs across systems eliminates double work and can help firms reclaim billable hours.
Poor Visibility and Communication of Write-Downs
Unclear billing practices and vague invoices confuse clients and can lead to disputes, prompting firms to issue write-downs to preserve relationships. You can avoid undervaluing your firm’s services by communicating proactively about billing frequency and expectations. The more transparent you are about your billing process, cycles, and itemization, the more you foster client trust and reduce revenue loss.
Keeping Track of Law Firm Billing Codes
With the shift toward flat fees and subscription models, proper use of UTBMS billing codes has become essential. These codes standardize invoices, improve clarity for clients, and streamline internal approval processes. Firms that implement structured billing codes reduce confusion and align more efficiently across teams.
Billing Descriptions
Generic or vague billing entries can lead to client dissatisfaction and erode trust in your firm’s transparency. Descriptions like “Call: 30 minutes” lack context and fail to convey value. Specific, date-tagged entries that explain the legal work performed enhance clients’ understanding and demonstrate the impact of each service.
How to Improve the Law Firm Billing Process
Streamlining your billing processes frees up valuable time for higher-value, billable work while improving cash flow and client satisfaction. Here are practical ways to optimize billing productivity.
Automate Time Tracking & Invoicing
Implementing software that automates time tracking and integrates it with invoicing can ensure all billable time is captured and save hours of administrative work each month. Your billing cycles will be faster and contain fewer errors.
Set Up Recurring Payments & Payment Plans
Create automated billing arrangements for ongoing client relationships to ensure steady cash flow without requiring manual intervention. Payment plans can also make legal services more accessible to clients while providing predictable revenue for your firm.
Streamline the Pre-Bill Review Process
Pre-bill reviews don't need to be manual, time-consuming tasks. Implementing electronic pre-bill reviews with workflow automation tools allows attorneys to review, edit or approve time entries before bills are created. This process eliminates the inefficiencies of paper-based reviews, ensures invoices are accurate, and keeps billing cycles on track.
Send Payment Reminders
Having an automated system for sending friendly payment reminders helps ensure clients don’t overlook due dates. Consistent communication about outstanding balances can significantly improve collections, reduce outstanding accounts receivable, and maintain healthy client relationships.
Accept Credit Card Payments
Many clients prefer paying online, and accepting credit card payments makes it convenient for them to do so. Modern legal payment processors will automatically account for clients’ online payments in your general ledger.
Transform Your Law Firm’s Billing Process & Get Paid Faster with Centerbase
The billing practices we've discussed throughout this article represent significant opportunities for midsize law firms to improve efficiency, cash flow, and client satisfaction. By implementing transparent invoices, streamlining workflows, automating time tracking, and offering flexible payment options, your firm can transform billing from an administrative burden into a strategic advantage.
Centerbase empowers law firms to streamline their billing operations with powerful features like multi-matter billing, electronic pre-bill approvals, automated time capture, and online payments—all integrated with robust accounting and matter management capabilities. Our platform reduces administrative overhead and helps firms maintain a steady cash flow while delivering a polished, professional client experience.
What's the Most Efficient Law Firm Billing Approach?
While hourly billing remains common, many firms find that a mix of billing structures (hourly, flat fee, and retainer) allows them to match pricing to matter type and client needs. Efficient billing, regardless of your firm’s fee structure, comes from implementing structured yet flexible processes that include automated time tracking, electronic pre-bill review, transparent and detailed invoices, and flexible payment options. By using legal billing software, firms can reduce administrative work, increase accuracy, and speed up the payment cycle.
How Much Do Law Firms Bill Per Hour?
Law firm hourly rates vary significantly based on location, practice area, attorney experience, and firm size. According to Thomson Reuters' research, law firms have seen record-setting growth in billing rates, with worked rates growing by an average of 6.5% in 2024 compared to the previous year. The largest firms (Am Law 100) led with 8.4% rate growth, while midsize firms averaged 5.6%. A Major, Lindsey & Africa survey found that average partner rates at large firms reached $1,114 per hour in 2024, with top firms charging $2,500+ for senior partners. For midsize firms, rates are generally lower but still rising steadily. When setting rates, firms should consider local market conditions, overhead costs, and perceived value rather than simply matching competitors' rates.
How Can Law Firms Get Paid Faster by Clients?
To get paid faster, firms should send detailed invoices, automate payment reminders, and offer multiple payment methods. Electronic invoicing with detailed time narratives reduces client questions and disputes. Accepting credit cards and setting up online payments through billing software can significantly shorten the time to payment. And sending invoices within days of work being completed can significantly improve collection speed and overall cash flow.
Family law firms face unique challenges that require innovative strategies to ensure long-term success. In advance of the AAML Annual Meeting in Chicago, Affinity Consulting Group, Centerbase, and 12 AAML fellows discussed how family law practices can adapt to future demands.
The conversation centered around three critical areas: profitability, the transformative role of AI in family law, and cultivating a strong, people-centered firm culture. This summary captures the group’s insights and actionable recommendations, offering a roadmap for family law firms looking to thrive in a competitive and tech-driven future.
Focus on Profitability to Maximize Resources
Profitability is an important measure of success for any law firm because it helps determine how efficiently the firm utilizes resources and how much value it delivers to clients. Measuring law firm profitability requires analyzing the underlying factors that influence profitability’s core components — revenue and expenses — which helps you identify opportunities to maximize profits and make data-driven decisions.
Actions to Take
Enhance Collection Processes: Create or strengthen a collections team to handle outstanding payments, minimizing the need for attorneys to follow up with clients. Use tools to automate alerts for retainer replenishments and overdue accounts.
Implement Clear Payment Policies: Develop a standardized approach that informs clients upfront about retainer requirements and account replenishments.
Introduce KPIs: What gets measured gets done, so establish collection goals (e.g., 90%+ collection rate) to improve financial predictability and accountability.
Leverage Technology: Consider software that offers automated time capture and billing to reduce lost hours. Tools such as Laurel AI or Centerbase’s Automatic Time Capture can help track all billable activities.
Use AI for Good in Family Law Practice
The usage of AI is changing the way attorneys and law firms operate for good. But rather than fearing AI, the mindful adoption of AI offers tremendous promise to enhance the way legal professionals work, reducing tedium in the practice of law while freeing up valuable time for thinking strategically, identifying creative solutions, and engaging thoughtfully with clients. Embracing AI thoughtfully is an act of helping your firm operate in a modern legal landscape.
Actions to Take
Explore Recruiting AI: Use AI-driven tools to scrape platforms like LinkedIn, identifying and compiling lists of qualified candidates without relying on costly recruiting agencies.
Automate Document Review: Use AI tools like Paxton.ai and Co-Counsel to handle initial drafts of discovery summaries, deposition reviews, and document comparisons.
Improve Written Communication: Grammarly and WordRake are tools that can improve clarity and professionalism in client communications.
Make AI Your Thought Partner: Utilize ChatGPT for brainstorming, drafting, and researching by posing prompts such as, “Suggest 5 innovative growth strategies for a family law firm.”
Integrate Time Capture AI: Investigate AI solutions to improve billing accuracy by capturing all activity data throughout the day. This helps avoid revenue loss from unbilled hours.
Foster a Culture that Values Your Firm’s People
Your people are your number one asset. Prioritize onboarding and retention strategies that help you take care of your team and build a strong culture centered on the firm’s values. Implementing these strategies proactively will help safeguard against costly employee turnover and set your firm up for greater success.
Actions to Take
Clarify and Communicate Core Values: Define core values and communicate them regularly across the team.
Onboarding and Training Programs: Build structured onboarding programs for associates, setting clear expectations, goals, and values from day one. Consider implementing a “University” program, where experienced attorneys mentor newcomers and provide training in core legal and business skills.
Host Regular Team Check-Ins: Hold weekly meetings to discuss progress, address challenges, reinforce cultural values, and provide feedback for associates’ development.
Create a Knowledge Library: Develop a knowledge-sharing system with standardized documents and training videos so team members can access firm-specific procedures and templates.
Encourage Peer Learning and Mentorship: Foster an environment where senior attorneys regularly provide feedback and mentorship, enhancing skills and strengthening relationships within the firm.
Embrace Progress to Build Your Firm’s Future
Family law firms have an opportunity to set new standards in how they serve clients, support their teams, and use technology to streamline their operations. Embracing this future requires a commitment to rethinking traditional approaches to profitability, talent management, and the role of AI. Now is the time to assess your firm’s strengths and identify where these strategies can make a meaningful impact.
Law firm profitability is often viewed in simplistic terms: the more billable hours attorneys log, the more profitable the firm becomes. But the reality of assessing profitability is far more nuanced. Profitability can be sliced and diced in several ways — by practice area, client, lawyer, and matter profitability, and more — and your firm has to determine what’s appropriate to analyze.
That can get complicated, but my goal with this article is to help make profitability analysis feel doable by looking at just one example — practice area profitability. We’ll look at how you can use practice area information to make strategic decisions about resource allocation, maximizing your profit margins, and maintaining a healthy work environment for your attorneys and staff.
Understand Attorney Cost Rates to Set a Profitability Foundation
Before we can begin analyzing profitability by practice area, we must understand what it costs your firm to provide its services by determining each attorney’s cost rate.
This is essentially the hourly cost of employing them, including salary, benefits, and overhead expenses such as office space and technology. This rate forms the foundation for assessing whether your firm is pricing its services appropriately and whether each attorney is contributing to overall profitability.
Base salary and benefits: The most straightforward cost is the attorney's salary, along with additional benefits like health insurance and retirement contributions.
Overhead allocation: Overhead includes office space, administrative support, technology costs, and other general expenses. Allocating these expenses to each attorney is essential for a true understanding of their cost.
Practice group specifics: Different practice groups may require varying levels of support or incur different costs. For example, a litigation group may need additional paralegal support compared to a transactional group, affecting the cost rate of attorneys in that practice area.
Calculate the cost rate for each attorney by adding their salary and benefits to their share of overhead expenses. This will give you a baseline cost per hour for each attorney, which can then be compared to their billing rate to determine their contribution to profitability.
Practice Area Profitability: Analyzing Where the Firm Thrives
Now that you’ve established attorney cost rates, you're ready to analyze profitability by practice area. This is often a relevant category to assess within a firm because it can reveal valuable insights that might not be apparent from a high-level overview of your firm's financials.
For example, a firm may appear profitable overall but harbor unprofitable practice areas that are being subsidized by more successful ones. This situation can lead to resentment among partners and potentially affect staff retention.
Not all practice areas are created equal — some may generate substantial revenue but come with high costs, while others may be highly efficient profit centers.
You can understand practice area profitability at both a high level and a granular level. By breaking down profitability by practice area, firms can identify which areas are driving the most profit and which may be underperforming. Here are some guidelines to approach this analysis:
Revenue vs. costs: Start by calculating the total revenue generated by each practice area. Then, subtract the costs associated with that practice area, including attorney cost rates, paralegal support, and other direct expenses. This will give you a clearer picture of each practice area’s profitability.
Attorney utilization: Consider the utilization rates of attorneys within each practice area. Are higher-cost attorneys working on lower-value matters? If so, reassigning that work to lower-cost associates could improve profitability.
Market rates and adjustments: The cost rate analysis also helps determine if the billing rates for specific practice areas are appropriate. If a practice area isn’t profitable, you can explore adjusting the rates or targeting different types of clients.
You want to regularly assess the profitability of each practice area by tracking revenue, costs, and utilization rates. Adjust resource allocation to ensure the right attorneys are working on the right matters to maximize profitability.
Leverage and the Concept of 'Highest and Best Use'
Another crucial factor that impacts profitability is how work is allocated across the firm. The concept of “highest and best use” can help ensure that the right person is doing the right work at the right time. This is particularly important for maximizing profitability in practice areas with mixed levels of complexity.
Partner vs. associate work: Partners typically have higher billing rates but also higher cost rates. Ensuring that partners focus on strategic, high-value tasks while associates handle routine work can help improve profit margins. The key is to avoid having high-cost attorneys working on tasks that can be done just as effectively by lower-cost attorneys.
Utilizing technology and support staff: Law firms should also leverage technology and support staff to handle tasks that don’t require an attorney’s expertise. Choose law practice management software for time tracking, document management, and other administrative functions to reduce the amount of time attorneys spend on non-billable activities to further enhance profitability.
Conduct regular reviews of workload distribution to ensure that partners, associates, and support staff are all working at their highest and best use. This will help optimize profitability while maintaining a balanced workload across the firm.
Benchmarking and Profitability Tracking
Benchmarking plays an important role in understanding whether your firm is performing as well as it should be. You can benchmark against both internal and external standards to identify areas for improvement and set realistic goals for growth.
Internal benchmarking: Compare the profitability of different practice areas, clients, and attorneys within your firm. Identify which areas are excelling and which need improvement. Then, use these insights to guide strategic decisions.
External benchmarking: Look at industry benchmarks for profitability, revenue per attorney, and other key performance indicators. This will help you understand where your firm stands compared to your peers and identify opportunities to enhance profitability.
Use benchmarking data to set performance targets for practice areas and individual attorneys. This will help create accountability and ensure that everyone in the firm is aligned with profitability goals.
Turn Insights into Action
Maximizing profitability requires moving beyond increasing billable hours to taking a holistic approach. This should include understanding attorney cost rates first, and then analyzing a category that makes sense for your firm, such as practice area performance. With this combined cost rate at practice area data, you can begin allocating resources strategically — all to identify hidden opportunities for growth, make data-driven decisions, and ensure long-term profitability for the firm.
By Paige Roncke, Chief Revenue Officer, Centerbase
The legal industry is at a critical inflection point where law firms can no longer identify only as legal services providers. Law firms must also be data and technology companies in order to effectively compete in the market for long-term success.
I discussed this new landscape with Debbie Foster, CEO of Affinity Consulting, during a webinar on law firm profitability. A substantial portion of that conversation was rooted in the theory that profitability is more than a simple math formula of revenue minus cost; rather, it’s about understanding your firm's opportunity to maximize revenue streams while also minimizing costs without compromising quality of legal services.
It’s a misnomer to assume the application of technology only minimizes cost. Yes, technology has a critical role in automating administrative tasks, optimizing billing processes and creating comprehensive and speedy communications both internally and externally. However, technology is best utilized when the full power of software is applied to maximizing potential revenue streams.
This can be software-driven enhancements like improving time capture to create more billable hours, building reports that provide deeper insights into profitability at various levels — from individual attorneys to entire practice areas — through data clarity and availability, and utilizing that data to retain and attract stronger talent that can bill at higher rates.
In other words, as Debbie stated, “Technology should be used as a revenue multiplier.” And multiplied revenue leads to greater profitability.
While many firms have already made investments in technology, they may not be fully utilizing these tools. Let’s examine how technology can enhance law firm profitability by improving time tracking, managing billing, and providing actionable insights into the firm’s financial health. We'll also discuss common technology pitfalls and how to avoid them, so your firm can make the most of your technology investments.
Where Technology Drives Profitability in Law Firms
With the right tools, firms can unlock efficiencies that translate directly into higher profits. The key is knowing how to leverage technology effectively to improve law firm profitability, such as:
Improve timekeeping: It’s no secret that lawyers often fail to capture all of their time, which represents a direct loss of revenue. Automatic time capture technology can ensure that all billable hours are accounted for, leading to increased revenue. Text messages, quick phone calls, emails, a few minutes spent editing a document — all those moments add up to billed time. Time tracking software will track it all, automatically.
Enhance collaboration: Cloud-based technology makes it easier for attorneys and staff to collaborate, share documents, and manage cases from anywhere. It also provides access to real-time data and communication tools, enabling better decision-making and faster responses to clients, which ultimately improves client satisfaction and retention.
Streamline billing and reduce write-offs: Legal billing software can automate the entire invoicing process, from generating accurate invoices based on captured time to sending automated payment reminders. As a result, you’ll invoice faster and more accurately, reducing write-offs and improving cash flow.
Optimize resource allocation: How effectively does your firm analyze profitability by practice area, client, and individual lawyers? Practice management systems track all aspects of a case, from time spent to expenses incurred. The system will then generate profitability reports that reveal profitability across multiple dimensions. You can use the data to allocate resources more effectively, ensuring that the most cost-effective lawyers do the most profitable work. You can also use this data to make investment decisions when determining which practice areas to fund or reallocate.
Improve collections: Tools like online payment portals and automated payment reminders can automate and streamline the collections process, reducing the amount of time it takes to collect outstanding invoices.
Streamline lead management: On the marketing side of running a law firm, technology can help you respond to leads quickly and efficiently, improving your chances of converting them into paying clients. This could involve using tools like customer relationship management (CRM) software, live chat on your law firm's website, and streamlined client intake workflows.
Promote a culture of continuous improvement: Fostering a culture where employees are encouraged to learn and use new technology can help you stay ahead of the curve and maximize your firm’s technology investments.
Technology Shouldn’t Be the First Budget Reduction
Despite these opportunities to use technology as a revenue multiplier to drive significant profitability gains, many firms struggle to fully leverage the tools they have — and that often leads to cutting technology costs. But cutting costs isn’t a sustainable path to profitability.
Consider these common pitfalls to avoid so you can maximize your technology to advance your revenue streams.
1. Underutilizing Software Features
Many law firms invest in technology but only use a small fraction of the available features. For example, your firm might not be taking full advantage of your practice management software’s time tracking, billing, and reporting features that could improve efficiency. Leveraging a tool’s full capabilities can not only improve efficiency but help reduce stress at work, too. Encourage continuous learning, where attorneys and staff explore new features and share tips for improving efficiency.
2. Lack of Ongoing Training and Support
Too often, technology implementation is treated as a one-time event rather than an ongoing process. A lot of effort goes into the rollout and not enough into continuous training to learn about the tool after it’s been implemented.
As Debbie says:
“We really need to marry up our technology spend with building a culture of training.”
Pay attention to new updates and features, and make sure your staff learns how to use them by providing ongoing training and support. Consider hosting monthly lunch-and-learn sessions to discuss new ways to use your tools more effectively.
3. Not Using Technology to Attract and Retain Talent
One of the best things technology can do for your firm is standardize processes. Sure, every lawyer prefers to do certain things differently, but technology can help you agree on standardizing core elements of practicing law and running a firm. The result goes beyond efficiency.
New associates coming out of law school want to gain experience with modern technology — and they expect it. Maximizing your technology presents your firm as forward-thinking and committed to providing resources to work effectively, and that can help you stand out as an employer of choice.
Newer technology presents employees with an enhanced user experience with fewer clicks, simpler and more modern interfaces, and intuitive ease of use. This streamlined experience over older systems leads to higher job satisfaction, boosting your talent retention and attraction.
The Future of Law Firm Profitability is Powered by Technology
Technology is no longer optional — it’s essential for creating a long-term competitive edge. Whether it’s automating time tracking, streamlining billing, or analyzing profitability across practice areas, the right tools can make all the difference in how efficiently your firm operates.
By embracing technology and ensuring it is fully integrated into your firm’s processes, you can unlock new levels of profitability, improve client satisfaction, and future-proof your business for years to come. The key is not just investing in technology but leveraging it to its full potential—and continuously improving how you use it through ongoing training and fostering a culture the embraces technology.
Why Profitability Matters for Law Firms
Profitability is one of the most critical measures of success for any law firm. But while it’s easy to fall into the mindset of “more billable hours equal more profit,” the reality is more complex. Simply focusing on the standard math equation of revenue minus expenses equals profitability doesn’t always tell the full story of a firm’s financial health.
In a recent webinar, “The Next Generation of Law Firm Profitability,” Debbie Foster, CEO of Affinity Consulting, and Paige Roncke, Chief Revenue Officer at Centerbase, explored the essential components of law firm profitability, moving beyond the basic math to consider how different practice areas, lawyer cost and billing rates, client profitability, revenue generation, and cost management play a crucial role.
How Do Law Firms Calculate Profitability?
At a foundational level, profitability is calculated as revenue minus expenses. It's a straightforward equation, but there are multiple factors influencing law firms’ revenue and expenses.
“While the simple math for profitability is accurate,” Debbie says, “in law firms, we need to look beyond what the profitability number is to what the profitability number could be in order to maximize what is left.”
To do this, you can define your firm’s profitability inputs by considering:
What do we want the end profit to be?
What comprises our law firm’s profitability? This could include: Practice area profitability, lawyer profitability, client profitability, and matter profitability.
How can we use technology to help us track our firm’s profitability?
“There are many ways to look at profitability, so you have to double down and figure out what combination of these inputs makes sense for your firm, and how will you track it,” Debbie suggests.
Let’s take a look at where to start.
The 5 Key Drivers of Law Firm Profitability
To move beyond the basic profitability equation, analyze the underlying factors that influence both revenue and expenses at your firm. By doing so, you can identify opportunities to maximize profits and make data-driven decisions. Here are five key areas to assess in your firm.
1. Lawyer Cost Structure and Billable Rates
Each lawyer in a firm has a different billing rate and cost structure. Partners might bill at a higher rate, but they come with higher compensation. Associates, on the other hand, may have lower billing rates but can be profit centers if their work is leveraged effectively.
Take the time to figure out each of your lawyer’s cost rate — what it costs them to provide their services — factoring in their salary, benefits, office space costs, and technology costs. By calculating this cost, you can determine the minimum amount each lawyer needs to bill to cover their expenses and contribute to the firm's profitability.
Example of a lawyer cost rate calculation
Start with the lawyer's annual salary — for easy math, we’ll use $120,000.
Calculate the monthly salary: $120,000 / 12 = $10,000
Factor in billable hours. Divide the monthly salary by the lawyer’s expected monthly billable hours to get an hourly rate: $10,000 / 100 billable hours = $100 per hour
Add benefits and overhead. Factor in the cost of benefits per hour (e.g., $30/hour) and overhead per hour (e.g., $70/hour) to get the lawyer’s hourly cost rate: $100 per hour + $30 hourly benefits + $70 hourly overhead = $200 hourly cost rate
Actionable insight: Now that you know how much it costs for this lawyer to provide their services, you can better determine a billable rate that will enable profitability. Follow this method to calculate the hourly cost rate for each lawyer and compare it to their hourly billing rate. If a lawyer’s cost rate is higher than their billing rate, this could indicate a profitability problem. Ensure that work is assigned based on each lawyer's cost-effectiveness, balancing their rates with the profitability of the cases they handle.
2. Practice Area Profitability
Not all practice areas are equally profitable. Some might generate higher revenue but come with greater expenses, while others may be less lucrative but require fewer resources. For example, family law cases might involve more administrative work, while corporate law could bring in larger retainers but demand more expensive expertise.
Actionable Insight: Start by analyzing each practice area’s cost rate to determine its profitability. Track the hours billed, expenses incurred, and the average rate charged. By understanding which areas are most profitable, you can make strategic decisions about where to focus your resources and who to leverage in your firm for different types of work.
“Understanding cost structure gives insight into appropriate billing rates for attorneys within a practice group,” Paige says. “With this information, you can balance the practice area’s work, having attorneys with a lower cost rate handle work that doesn’t require a senior partner’s expertise, which starts to help you adjust your profitability for that practice area.”
3. Client Profitability
Not all clients are created equal in terms of profitability. Some may require more time, resources, and attention, while others are more straightforward and generate higher profit margins. By understanding which clients contribute most to the firm's profitability, you can make more informed decisions about where to invest your time and effort.
Actionable Insight: Regularly review client profitability by tracking the time spent on each client’s matters and the revenue they generate. This will help identify high-maintenance clients who consume resources without delivering commensurate revenue, enabling the firm to renegotiate terms or focus on more profitable clients.
4. Revenue Generation
Maximizing revenue might seem like a straightforward goal, but the practical aspects of capturing all billable time, diligently following up on leads, minimizing write-offs, and optimizing accounts receivable collections often fall by the wayside. It's common to underestimate the significance of these seemingly mundane yet critical tasks that can make or break your firm's profitability.
Actionable Insight: Maximizing these revenue-generating tasks comes down to having the processes and tools in place to set your firm up for success. Paige sums up four actionable areas to optimize your firm’s revenue.
Following up with leads. Implement a process for following up with leads efficiently to turn them into clients. “Following up with leads is your first chance to generate revenue for the firm,” Paige notes.
Time tracking. Implement time-tracking technology to ensure all billable hours are captured. “Whether it's texts, phone calls, emails, meetings — you want to capture every moment of time worked for a client,” Paige says. “Even small increments of missed time can add up significantly over the year, impacting overall profitability.”
Pre-bill review process. How much time gets written off at the pre-bill stage because of your perception of the client's willingness to pay? Establish clear billing policies to minimize these pre-bill write-offs.
Accounts receivable process. Enforce a structured accounts receivable process for efficient collection. Paige notes, “When you send an invoice, it doesn't stop there. There's negotiation that happens, and it changes per client. You want a policy in place, so you don't get stuck in the 90-day mark writing off outstanding bills.”
5.Cost Management
Law firms have three main expense categories — personnel, office space, and technology — and managing these costs is another important factor in a firm’s profitability. However, it’s not necessarily about minimizing expenses, but rather optimizing what you spend.
“It’s important to not waste money,” Debbie says, “and you do that by making sure you’re leveraging what you buy. You need to think about people planning, space planning, and technology planning to utilize them all effectively.”
Actionable insight: Using technology as an example, if you invest in cloud-based software but don’t review the updates and learn about new features regularly, then you’re not leveraging the software — or your money — to its full capacity. Similarly, when you hire new staff members but provide little training on the firm’s processes, technology, and culture, you’re not optimizing personnel or technology, and you’re risking additional expenses through attrition if staff members become disengaged to the point of resigning.
Law Firm Profitability is About More Than Just the Bottom Line
Understanding profitability isn’t just about looking at the revenue minus expenses equation. It’s about going beyond basic math and exploring how you can optimize each component of your business. By focusing on core drivers of profitability — cost and billing structure, practice area profitability, client profitability, revenue generation, and cost management — your firm can uncover opportunities for long-term growth and profitability.
Stay tuned for our next article, which will focus on the impact of technology and how to leverage it for law firm profitability.
As the legal landscape becomes more complex and competitive, adopting modern law practice management software is one of the best ways to help your law firm keep up. Legal technology can greatly increase your competitive advantage, make your operations more efficient, and continuously enhance client service.
However, this journey isn’t as simple as purchasing the first legal software you come across online. It involves a step-by-step process of assessing your firm’s needs, conducting due diligence to select the right vendor for your firm, and implementing the software.
Based on the latest insights from Centerbase's 2024 Guide to Buying Law Practice Management Software, this article will help you navigate and simplify the path to selecting the best legal practice management software for your firm.
Why Law Firms Change Technology
Law firms turn to technology for a variety of proactive and reactive reasons. Proactively, firms seek opportunities to increase efficiency, improve client service, and maximize cost savings. Reactively, they are compelled to switch software when faced with challenges such as missing functionality, the need for remote work capabilities, system consolidation, data security issues, or the need to retire an old server.
Assessing Law Firm Technology Needs
Before embarking on the legal technology journey, take an inventory of your firm’s current technology infrastructure. Then, ask your team to identify gaps your current tech stack doesn’t fill to understand their vision to optimize law practice operations.
By building a cross-functional team to represent your law firm's software user base and setting expectations for what the new software should accomplish, law firms can outline a clear vision for their technological needs. Be sure to consider budgets during this assessment, too.
Choosing a Legal Software Vendor
Once the technology needs have been assessed, the next step involves selecting legal practice management software that's right for your firm. This process requires a comprehensive review of potential vendors based on selection criteria that go beyond cost.
Features and capabilities to consider in law firm software
Timekeeping
Billing
Accounting
Reporting
Calendaring
Task management
Document management
Workflow automation
Communication tools
Client intake process
Scalability
Integration capabilities
Data privacy and security
Disaster recovery
Training and support
Reputation and track record
Create a short list of best law software vendors
Now that you've researched various software vendors' offerings, make a short list of finalists, send them a request for proposal, and set up demonstrations.
Collect your findings on how well each legal practice management software meets your team's expectations, conduct reference checks, and review terms of service and service level agreements.
You're now ready to score the proposals, run pilot tests of the best options, run the numbers, and make a choice.
Implementing New Legal Software
With a vendor selected, the next step is implementation. This process may include stages like data migration, setup, configuration, and testing.
Training is also indispensable at this stage as it is vital for maximizing the return on the investment in law firm technology while also driving successful software adoption.
Keep in mind, legal technology isn't a one-size-fits-all solution. It needs to be the right fit for your law firm to truly optimize operations and stay competitive in the fast-evolving legal industry.
With the meticulous planning, careful selection, and continuous learning we've outlined, you'll be on your way to using technology as a powerful tool to enhance efficiency, improve client service, and contribute to your firm's overall success.
In today's legal landscape, staying competitive and efficient is crucial. If your firm isn’t using an all-in-one legal practice management software to streamline firm and client operations, you’re missing out on the highest level of efficiency and competitive advantages to set your firm apart. The cost of not having such software is too great to not act.
Multiple types of productivity software exist to improve law firms’ efficiency with certain tasks, such as client intake, case management, and timekeeping. But having multiple disparate systems requires opening each one, toggling among them when switching tasks, leading to less efficiency overall, not more.
Yet, many law firms hesitate to adopt legal practice management software that could solve their efficiency woes, underestimating what law firms stand to lose by choosing the status quo. Just like neglecting IT infrastructure, ignoring legal technology can lead to significant financial and operational downsides.
But why do law firm hesitate to adopt legal software? According to Forbes, choosing not to upgrade software is rooted in common fears, including:
Fear of disrupting business operations
Fear of change and the discomfort that change may cause to employees who prefer familiarity
Fear of missing out on perceived short-term benefits, even when they understand the potential long-term benefits of modern software.
What’s the cost of not having legal practice management software?
Without legal practice management software, you’ll miss out on operational efficiency, best practices, and firm culture benefits that optimize your law practice. Let’s dive into some of the greatest potential costs associated with not implementing an all-in-one legal technology platform.
Efficient and accurate accounting
Building your general ledger accounting into your timekeeping, billing and accounting operations in one platform gives you the most efficient and accurate accounting operations.
Integrating data for each of these processes means you enter the data once, and it populates everywhere. This helps your firm avoid double-entry recordkeeping between multiple software systems, and it ensures consistent data across the entire system.
Without the right legal practice management software, you might even miss out on the ability to integrate general ledger firm and trust accounting in one place, which enables reconciliation across your client and firm accounts. With such a system, you can track every dollar in and out of your law firm.
Loss of Billable Hours
Without streamlined processes, you and your attorneys are wasting time on administrative tasks. Legal practice management software automates billing, scheduling, and document management, freeing up time for billable work. This directly impacts revenue, as even a small increase in billable hours can lead to substantial financial gains over time.
Data Security Risks
Without robust software solutions, your firm could be at risk of data breaches. With the high degree of sensitive client information you handle, a data breach can be costly and damage your firm’s reputation. Legal practice management software often includes secure data storage and encryption, ensuring client confidentiality and compliance with legal standards.
Client Dissatisfaction
Efficient case management is key to client satisfaction. Manual processes can lead to delays, missed deadlines, and errors, frustrating clients. Legal practice management software enhances communication, tracks case progress, and ensures deadlines are met, leading to better client relationships and retention.
Competitive Disadvantage
Law firms that use technology risk falling behind competitors who are more tech-savvy. Legal practice management software enables firms to leverage analytics and reporting, improve marketing efforts, and offer better services, helping them stay competitive in a crowded market.
An investment or a cost?
Investing in legal practice management software is not just about improving efficiency; it's about protecting your firm's financial health and reputation. The cost of doing nothing can far exceed the investment in the right software solution. If you're considering enhancing your practice with technology, now is the time to act. Don't let your firm fall behind — explore the benefits of legal practice management software today.
Written by Carson Bailey, M. Ed.
The legal landscape is evolving rapidly, driven by advancements in legal technology. Law firms continually seek ways to improve efficiency, streamline operations, and provide better client service — and that requires them to integrate new software into their daily workflows.
However, introducing new software to a law firm often faces resistance. Lawyers and staff prefer to focus on delivering legal services, so adopting new technology can disrupt their routines. Moreover, lawyers and staff view software training as a bore and a chore. The traditional sit-and-get training format often doesn’t meet the needs of adult learners, frustrating them and turning them against new software before they can even try it.
When legal professionals aren’t fully trained on software, they often don’t fully use that software or neglect it outright, reducing the value of your law firm’s investment.
Fortunately, learning management systems (LMSs) have revolutionized training and encourage the adoption of new legal technology. Before we dive into the benefits of using an LMS for software adoption in law firms, let’s quickly review what an LMS is.
What is a learning management system (LMS)?
An LMS is a software platform that facilitates the creation, management, delivery, and tracking of educational content. Leading legal software providers offer a specialized LMS designed to meet the unique training, compliance, and knowledge management needs of legal professionals and staff.
A software provider’s LMS is a foundational part of software training; it’s a centralized hub for all training-related activities, delivering, tracking, and managing various types of professional development and knowledge resources and streamlining the learning process.
How can law firms implementing new software benefit from an LMS?
An LMS can enhance the efficiency, effectiveness, and accessibility of training on new software for lawyers, legal professionals, and other staff. It empowers users to become proficient with software tools, ultimately contributing to improved productivity and the successful integration of software into the law firm’s operations.
At Centerbase, self-guided learning through our LMS accelerates the training process, giving users a head start before our virtual and in-person training sessions. Our LMS kick-starts the learning process, so users know what functionality Centerbase offers and what questions to ask, streamlining their training and ensuring they understand the solution and its benefits before using it.
Here’s a summary of the benefits of our LMS.
Customization: Users won’t pay attention to instruction irrelevant to their role. In the Centerbase LMS, customized learning paths can be established that cater to different roles and skill levels. For example, administrative staff and lawyers may have access to different lessons and test environments tailored to their needs.
Flexibility: Flexibility is key in the legal industry, where professionals often juggle unpredictable workloads and deadlines. Our LMS allows users to access training materials at their own pace. This 24/7 accessibility allows legal professionals to fit learning into their busy schedules, minimizing disruptions to their workflow.
Consistency: Traditional training methods can result in disparities in the quality of training received by different users. With the Centerbase LMS, law firms can ensure that all users receive the same training content, maximizing users’ potential to leverage the software effectively.
Progress tracking: Assessing users’ understanding is essential to gauging the effectiveness of software adoption. Our robust LMS allows law firm administrators to monitor user progress as they go through the software training so they can identify users who may need additional support or intervention.
Resource accessibility: The Centerbase LMS can house an extensive resource library, including video tutorials, user manuals, FAQs, and troubleshooting guides, ensuring that users have the support they need to address challenges whenever issues arise, reducing frustration.
Feedback and support: Our LMS allows users to seek support. Users get prompt responses to their queries, allowing them to overcome obstacles and continue their learning journey without disruptions.
Knowledge retention: To ensure long-term proficiency, legal professionals may need to revisit training as they encounter new scenarios or updates to the software. Our LMS supports knowledge retention by allowing users to revisit training materials and resources whenever needed. This ensures that software proficiency is maintained over time, even as staff members change roles or new features are introduced.
Remote learning: The legal industry has experienced a shift toward remote work. The Centerbase LMS accommodates this trend by facilitating remote learning. Users can access training materials anywhere and anytime.
Cost savings: Inadequate training can result in inefficiencies and lost billable hours. Our LMS minimizes these risks by providing efficient and structured training, ensuring that the investment in software is maximized. Plus, reduced training time translates to increased productivity.
Start optimizing your law firm software adoption with an LMS
An LMS is pivotal in offering flexible, relevant, and personalized training experiences. By adopting the right training methodologies and involving the right stakeholders, law firms can navigate software implementation challenges and equip their teams with the skills needed for a competitive edge in the legal industry.
Executive directors and legal administrators play a crucial role in the smooth operations of a law firm. They wear many hats, ensuring organization, facilitating communication, balancing accounts, and scheduling dockets, among many other things. They’re the drivers behind the business of law making sure that nothing slips through the cracks.
But all of these responsibilities require a specific kind of person and can add up to a highly stressful job. Fortunately, legal technology makes it easier than ever to support legal administrative staff so they are able to focus on higher-level work and do so with and less unneeded stress.
In this article, we’ll discuss how to attract and retain law firm administrative staff, including how technology can help you deliver the support that administrative personnel need.
Why is it hard to recruit new talent to administrative roles in law firms?
A 2022 Report on the State of the Legal Market from the Thomson Reuters Institute and the Georgetown Law Center noted “serious retention challenges with respect to professional staff other than lawyers.” In a tight talent market, “many [administrators] feel empowered to shop around to improve their compensation and working conditions. Law firms may have to confront something they haven’t seen in the legal industry in quite a while: leverage owned by those who are not attorneys.”
In today’s environment, legal administrative professionals know they have earned better work conditions. They want to feel valued in terms of compensation and recognition and want to have a better work/life balance. It’s clear that law firms need to act now to ensure that they can both hire and retain top administrative talent.
What can I do to attract and keep new top administrative talent?
To attract and keep legal administrative talent, your law firm needs to take a strategic approach. Here are a few ways that your firm can get started.
Offer competitive compensation and benefits
Money talks: it’s an obvious reason that people choose a job and stick with it. People want to be paid what they are worth and receive compensation consistent with the value that they bring. By offering compensation and benefits packages that align with what’s being offered in the legal market, you’ll show new talent that your firm values their role and prevent them from looking to jump ship to your competitors.
However, it takes more than just compensation to make a staff job at a law firm fulfilling.
Build a law firm culture that appreciates the value of administrative staff
Over the years, some law firms have maintained a de facto caste system that separates lawyers from nonlawyer staff. The very word “nonlawyer” is part of the problem, minimizing the importance of the work that law firm staff do. This type of firm culture sometimes also leads to heavy investment in tools, technology, and benefits to support lawyers but less investment for staff. This approach hurts the efficiency of the entire firm.
To ensure you build a culture that supports legal staff, emphasize the strategic importance of administrative work and highlight the varied responsibilities that administrative personnel have and how they help your law firm function and grow. We also recommend outlining clear career progression paths for administrative professionals in your organization. For example, a firm can offer opportunities for continuous learning and development, such as training programs, workshops, and certifications. Also consider how you can implement technology designed to support them working more efficiently, such as tech platforms that enable them to streamline calendaring, simplify document management, improve billing practices, and handle other strategic tasks.
Find ways to improve work/life balance
Work/life balance is important across the board and it plays a crucial role in attracting and retaining top talent, including legal administrative staff. Administrative staff typically face demanding workloads, tight deadlines, and high-pressure situations along with attorneys and both sides appreciate benefits such as paid time off and flexible work arrangements.
Hybrid work arrangements are an important perk for today’s admins, and enabling staff to work from home requires the right legal technology. Cloud-based legal software allows administrative personnel to work from anywhere. The right matter management platform will put all of the essential information about a matter or client at your staff’s fingertips, keeping all related records such as texts, bills, and documents corralled in one place. A cloud-based client portal avoids back-and-forth, time-consuming emails and reduces the repetitive work on your admins’ plate by giving clients direct access to the answers they need. Leading cloud-based document management platforms preserve client confidentiality and protect sensitive matter details, eliminating the risks of sending confidential documents in unencrypted emails.
Simplify tedious work
But improving the work life for your team goes beyond access. A critical part of making work more fulfilling requires firms to give staff the tools that simplify their work.
Automating tedious, repetitive, manual work like pre-billing and client intake not only makes admins’ work more efficient, but it also means that your team can devote their time to higher-value work that requires a higher skill level. Allowing administrative professionals to focus on more strategic tasks creates a more satisfying work environment. You can also improve their workday with tools that foster communication and streamline project management. This technology reduces administrative bottlenecks, enhances efficiency, and fosters collaboration, all of which can help attract and retain legal staff.
Enhance your law firm’s brand
There are lots of reasons to invest in branding, one of which is that legal administrative professionals in the market will Google your law firm’s website and assess its online presence, including not just its job listings but also its culture. A well-designed, informative website enhances your firm’s credibility and professionalism, which can attract high-quality administrative staff seeking career opportunities with reputable, forward-thinking organizations.
We recommend a professional yet friendly website that includes staff and administrator bios. This will emphasize to candidates that administrative professionals are a valued part of your firm’s legal team. You can also share testimonials from staff and offer a glimpse into what it’s like to work for your law firm, so candidates can determine whether they’re a good fit.
Use legal technology to attract legal administrative professionals now
In today’s competitive job market, your law firm needs to do more than offer a competitive salary and standard benefits. You also need to invest the overall importance of your administrative staff, including in legal technology, showing them that you value them and their work enough to help them do it more efficiently and with fewer headaches.
Attracting and retaining top legal talent is critical in today’s competitive market. A team of top attorneys gives your firm a competitive edge and ensures your firm will continue to impress clients with quality legal work.
In this article, we’ll cover four ways to attract (and retain) top legal talent, with an emphasis on how legal technology can help you do both.
What are the expectations of today's top talent?
With recent layoffs at large law firms and the incoming classes of law school graduates, there are great opportunities for smaller and midsize firms — if they can compete effectively in the job market.
Today’s top legal talent has high expectations: competitive pay, opportunities for professional development, a meaningful work/life balance, and leveraging advanced legal technology. While meeting these expectations may seem challenging, it’s essential for law firms that want to attract and retain the best lawyers and staff.
Let’s get into some specifics.
1. Competitive pay and benefits
Top legal talent expects to be paid what they are worth. Offering a competitive salary and comprehensive benefits package is crucial to attracting new lawyers and staff. A higher starting salary and market benefits (e.g., health, dental, and vision) will translate directly into more applications for open positions and higher retention rates.
Of course, if you get into a salary tug-of-war with your competition, you’ll eventually run out of cash. Increases are only sustainable to a point. That’s why your firm should focus on the totality of what it has to offer, including training, work/life balance, and technology that makes the job easier.
2. Professional development opportunities
Top legal talent typically wants opportunities for professional growth and development so they can stay ahead of the curve. As a law firm, it’s important to offer these opportunities at all levels of practice.
For both lawyers and staff, constructive feedback and positive encouragement are important. By providing personalized feedback and having one-on-one meetings and not just waiting for end-of-year performance reviews, your attorneys and staff members will feel supported in their learning and will believe that there’s a path forward for them in the firm.
More formal learning opportunities are also essential for attracting and retaining skilled attorneys. Incorporate opportunities for continuing legal education (CLE) sessions and conferences in your learning and development budget. Investing more in learning and offering growth opportunities means your lawyers will be prepared to deliver better work to your clients — and more satisfied clients mean more income for your firm.
3. Work/life balance and flexible work arrangements
By offering flexible work arrangements — like remote or hybrid work or adjusted work hours — you’ll provide lawyers with the tools to manage their personal responsibilities. This includes flexible arrangements for new parents or employees who might need to work remotely to care for an aging family member. By providing flexibility, your firm will emphasize its commitment to supporting its attorneys and staff, and in doing so will attract the best of the best.
Legal technology can be employed to make it easier for attorneys to get their work done anytime, anywhere. Cloud-based legal software that enables secure remote access of case files, documents, and other client materials means lawyers can work from home or on the road more easily. Leading legal software platforms can enable lawyers to communicate and collaborate seamlessly with team members and clients through document sharing, messaging, and videoconferencing.
4. Advanced legal software
Advanced legal technology isn’t only important for offering flexible work arrangements — it’s also an expectation for incoming top talent. Good legal tech makes life easier for attorneys by streamlining work processes and increasing efficiency. It allows lawyers to work smarter by calendaring deadlines, prioritizing billable tasks, and ridding themselves of mundane or repetitive tasks through automation. Time capture tools make it easier than ever to keep valuable billable minutes from falling through the cracks.
The bottom line on legal recruitment and retention: Money talks, but so does legal technology
While lawyers may be wooed by an attractive compensation package, they won’t stay if they don’t like working for your firm. An important part of your firm’s culture rests on how well you enable your lawyers and staff to work. That requires an investment in the latest legal technology.
This means tools to help with everything from case management to removing the tedium of timekeeping and billing (maybe the most frustrating of all law firm tasks).
And tech that enables internal collaboration, helping teams build a collective knowledge base that everyone can access and improving work quality, avoiding duplicative efforts, and accelerating results. For instance, a fully integrated matter management system will help keep everyone on a team up to date on matter status and highlight roadblocks where someone may be able to offer their expertise. Teams can also collaborate in real-time and track matter status, allowing for greater flexibility while also building a sense of community.
Everything is connected this way: better tech leads to less tedium, allowing lawyers to get their billable work done more quickly, which gives them more time to focus on their personal lives and find their own preferred work/life balance.
Of course, one of the best ways to convey to talent that you are the right choice for them to excel in their legal careers is to have an up to date and professional website. today’s talent expects a robust digital presence, and the first place they go to research employers is online.
Your firm’s webpage should highlight your firm’s culture and include statements or videos on your website with partners, associates, and staff explaining the benefits of working for your firm.
Junior and senior lawyers alike expect access to advanced tools that make work easier, enabling them to deliver exceptional client service and improving their work/life balance in the process. Law firms that invest in legal technology platforms can attract better talent and position themselves as industry leaders.
