5 Essential Management Reports for Your Law Firm
The secret to a successful law firm is knowing how it's performing at all times. By tracking your law firm's most important metrics, you can stay on top of what’s working, and identify what changes need to be made. Not to mention running reports helps you keep a close eye on any potential issues and stand out from the competition.
The great news is that running management reports doesn't have to be a complicated process. Realistically, there are only a few reports that are considered essential for your law firm’s growth. With so much already on your plate as a busy lawyer, there's no point in losing time running reports that aren't relevant to your long-term goals. Let’s go over the most important ones that play key roles in the overall success of your law firm.
Why you should be running reports
Better insight
Once you start treating your law firm like a business, you'll find that things run much more smoothly. Examining not only what's happening in your law firm but why it happened can improve your overall performance, streamline your processes, and address any issues that need to be taken care of.
Running regular management reports keeps you accountable for how close you are to achieving your long-term goals. By revisiting your figures, you’ll have a better assessment of your overall performance since reports eliminate guesswork about why you aren't getting as many clients as you’d like to. Instead, you'll have specific answers to turn into solutions.
Better planning
If you have no idea how well your law firm is performing, from who your most productive staff members are, to how many new clients you've acquired, then you're heading towards an uncertain future. Reports arm you with all the information you need to construct your long-term strategy, and help you make informed decisions rather than acting on hunches.
Increased client satisfaction
Many law firms have so much going on that the last thing on their minds is a client-centric experience. With so many tasks piling up from day to day, it's easier to prioritize getting it all done over tuning into how good of a client experience you're delivering. However, running reports may reveal that your referral rate is quite low, and you have hardly any repeat business.
In today's consumer-driven market, you can't get away with mediocre service anymore. One of the first things that potential clients do when considering a lawyer is turning to Google. If you hope to stand out amongst the competition, you'll need to make sure that you have positive reviews.
Time saved
Many lawyers have no idea how much time they're wasting on parts of running their law firm. Management reports can identify major bottlenecks, and where you're losing the most time as a lawyer, time is money. The more opportunities you can identify to save more time that you can dedicate to billable work, the more money you'll put in your pocket
More revenue
Increased revenue at your law firm comes down to a simple formula. Increased efficiency equals increased revenue. Running the right management reports can give you the information you need about where you need to speed things up, or where your most profitable lead sources are. Information is power.
Tips for getting the most out of your management reports
Create a long-term strategy
In order to determine the most relevant management reports to run for your law firm, you should first develop your long-term strategy. Where do you see yourself down the road? Who is your ideal client? The more you can define and pinpoint where you see your future, the more useful your reports will be.
Defining your targets will help you stay on top of your goals, and decide whether your current efforts are working, or whether they need to be tweaked.
Track them regularly
It's no use running a report once a year and expecting it to make a difference. Checking your reports regularly is the only way to stay accountable and leverage the information appropriately. By observing your own performance regularly with law firm performance management and comparing it to your competitors, you can stay on top of your long-term goals.
The longer you allow problem areas to persist, the worse they can get. By consistently running reports and taking action on them right away, you keep your law firm on track
Act right away
When you run a report and find certain things just aren't working, you have to take action. Even though change can be uncomfortable, it's important that you act right away.
Sitting on information is missing out on an opportunity to perform better and reach your long-term goals sooner. For example, f your lead conversion rate is dropping you know that you probably have holes in your client intake process that need to be taken care of immediately. Each lead you lose track of is money lost. Rather than manually trying to track each lead, an attorney intake software will do it for you so that no more opportunities will slip through the cracks.
Communicate amongst staff
The only way to effectively put information from your management reports into action is by getting everyone on your team on board. After running your reports, you should have a meeting to ensure everyone on your team is doing their part to reach your objectives.
Your team is only as strong as its weakest link, so make sure everyone shares the same vision.
5 essential management reports for your law firm
1Client acquisition
In order to determine that your lead (aka potential new client) to sale (retained client) conversion rate is where you'd like it to be, you should run a monthly client acquisition report to get to know things like where your best clients are coming from, the value of each of their cases, and your total number of no-shows.
The idea is to have a clear understanding of how well your lead conversion pursuits are going. If your law firm data analytics reveal that you have a considerable amount of consultation no-shows, then you know that you need to make changes to keep your leads engaged. Turning leads into clients is often a rinse and repeat process. Keep trying new tactics until you find an effective method that gets your numbers where you'd like them to be.
Usually, a poor lead to client conversion rate is an indication that you need to improve your client intake process. If you aren't using a client intake software that tracks leads automatically from start to finish, then it can get incredibly laborious manually keeping up with each contact.
The number of matters opened at your law firm is directly connected to the amount of revenue that your law firm produces. New clients are critical for the success of your law firm's future, so make sure that you pay attention to whether your client acquisition rate is where you want it to be.
2Productivity
Productivity reports are important for tracking how well you're performing both at an individual and collective level. Tracking the total amount of tasks pending compared to what you’ve completed on a weekly basis can be extremely helpful in identifying areas for growth. Tasks are usually one of the biggest culprits for lost time in a law firm. So, by measuring and analyzing how many tasks you're currently completing and comparing it to how many you’d like to complete, you can make data-driven decisions to improve your practice and boost your productivity.
Usually, law firms are shocked to see the reality of how much time they are wasting manually completing tasks that could be delegated to automation software.
Statistics show that lawyers spend almost 50% of their workweek on administrative tasks, which means less time focusing on their clients. Unfortunately, administrative tasks must be done for a law firm to keep running and aren’t something you get by without doing.
However, by tracking your law firm’s productivity, you can identify where you are losing the most amount of time in your practice, and make the necessary changes so that you can focus your time on the areas of your practice that produce the most profits. The end result is more free time to focus on making your law firm a profitable business and less time wasted on time-draining manual processes.
3Client satisfaction
Measuring client satisfaction is something relatively new for legal professionals. Once upon a time, a client-centric approach to practicing law wasn't a widespread concept. However, as more and more law firms start to recognize the importance of a positive client journey for producing repeat business and referrals, the more lawyers strive to improve on their client satisfaction.
Evaluating your overall client satisfaction is as simple as running reports on key performance indicators that reveal how happy your clients are when working with you. For example, the number of client referrals you have along with client retention rates can be very indicative as to whether you're providing a positive client journey or not.
Lastly, sending out client satisfaction surveys and basing your feedback off of the scores clients give you should also be included in your evaluation. The more you start to prioritize the client experience, the better ratings you'll get on Google, and the more business you'll start to bring in.
4Revenue
Ultimately, your overall profitability is the foundation of your law firm’s success. It goes without saying that you should be paying the most attention to the amount of revenue you're bringing in. Pay attention to reports such as total revenue billed over the month compared to what was actually collected, as well as your net overhead, average fee per matter and most revenue-producing marketing sources. Monitoring your revenue by using time and billing software for lawyers can make a significant impact on your strategy, and results in better planning and more informed decisions.
5Marketing
It's imperative that you know whether your law firm marketing strategies are working or not. Running reports on your marketing campaigns can track your activity, and provide important insight as to whether you're getting the best possible return on your marketing investments. A law firm reporting software like Lawmatics provides an easy-to-read format with all of your marketing activity laid out. A simple chart makes it easy to read which campaigns are producing the most leads, clients, and revenue. That way, you can make sure that you're only putting your money where it's producing the most return on investment.
If the campaign isn't that effective, then it's time to switch things up. You should also keep an eye on other marketing metrics like visit to lead ratio, SEO keyword ranking, email click rate, and bounce rate. A bounce rate is important because it can reveal whether your website is performing as well as you need it to be. And since your law firm website is the cornerstone of all of your marketing efforts and the final destination you want people to ultimately land, you need to make sure it’s up to par.
Over 30% of clients look for lawyers online, so you want to make sure that when a visitor lands on your website they’re compelled to stick around. If they’re not then you can determine where you need to make upgrades. In many cases, a high bounce rate could be a result of irritating pop ups, or maybe your site isn't mobile-friendly. Whatever you do, make sure that you check regularly so that you know you’re spending your valuable resources where they count most.
Come out on top with the help of legal data analytics
Tracking your firm's internal activities means taking charge of your future. As you fine-tune your strategy, you can in turn reach your goals even faster. By easily being able to see everything in one place, you can keep your staff on the same page, keep your eye on your long-term goals, and streamline the tasks in your practice where it's needed most. With a visual representation of your law firm's progress, anyone in your law firm can easily digest the information. Running regular reports on the essentials, keeps you motivated to continue making progress and making changes where they count the most.
Although data is relatively new in the legal world, it's something businesses have been leveraging for quite some time. Information is power, so the more data you can get your hands on, then after you can reach your goals by measuring your progress and ditching what’s not working in your practice.
Are you ready to see how Lawmatics legal reporting software can help you set clear goals, make informed decisions, and ditch the guesswork in your law firm? Sign up for a free product demo today!