Description
Book SynopsisWith rising competition putting pressure on law firms to raise their performance levels, Alan Hodgart's much anticipated report on Performance Measurement for Law Firms could not have come at a better time. Hodgart, an acknowledged industry expert, provides practical step-by-step guidance on how to effectively measure the performance of your fee earners, core support functions and overall firm. Hodgart highlights the key challenges many law firms face when measuring performance and provides critical advice on how to tackle them successfully through the development of an effective performance measurement system. Key topics covered include: * Measuring performance in law firms - what it means and what to measure; * The key financial measures of profitability and how to calculate them - cost, profit, revenue; * The data and financial information required at firm and practice-group level; * The effective use, and abuses of financial data; * Aligning the economic structure of your type of work to maximise profitability; * Implementing an effective performance measurement system; * How to measure the performance of your fee earners and support staff - finance, IT, Marketing, HR, KM and other; * Client profitability, project management and much more - The report focuses particularly on profitability and demonstrates how it can be used to monitor and compare the outcomes of working with different clients to project future revenue and profit levels. It also includes a useful appendix - an 'Economic Template' which demonstrates how to assemble the relevant data to manage the financial performance of your firm. Performance Measurement for Law Firms is essential reading for any firm looking to measure and enhance all areas of their performance.
Table of ContentsChapter 1: Measuring performance in law firms - What it meansand what to measure...1 Chapter 2: The key financial measures of profitability ...7 Example one - The difference between cash and profit ...9 Example two - Impact of revenue definition on Revenueper Fee Earner (RFE)...11 Example three - Impact of revenue definition on averageprice per hour ...12 Example four - Cost and leverage per equity partner ...16 Chapter 3: The uses and abuses of financial data ...21 Determining the right economic structure for the type of work ...22 Chapter 4: Measuring fee-earner performance ...31 Chapter 5: Measuring the performance of support functions ...35 The finance function ...35 The marketing function ...37 The HR function ...38 The IT function ...39 Other support functions ...40 Chapter 6: Client profitability and project management ...41 Chapter 7: The art and science of measuring performance ...47 Chapter 8: Issues in setting budgets for the next financial year ...51 Setting budgets ...53 Looking ahead ...56 Chapter 9: Setting fees that balance the firm's and client's interests ..57 The law firm perspective - Profitability ...57 Key profitability drivers ...59 The client perspective - Value ...60 Pricing - Balancing profitability and value ...61 Project management, pricing and profitability ...63 Chapter 10: Deleveraging - The case for and against ...65 Chapter 11: Performance trends for the year ...73 Declining fee income ...74 Profits per Equity Partner (PEP) under pressure ...75 Top 11-25 at tipping point ...76 Funding under pressure ...77 Head counts falling ...78 A radical response ...79 Appendix 1: The economic template ...81 Index ...83
