Time recording has always been a core process in the business of law. And, almost as long as there has been timekeeping technology, there have been predictions about the ‘death of billable hours and the need for time recording.’ With more firm clients demanding creative and especially predictive pricing strategies from their outside counsel, you might be quick to believe the hype that timekeeping technology is stale, antiquated and oh so passé.
Well thank goodness for change and innovation. Alternative fee arrangements (AFAs) are on the rise across the law firm land. For example, more than 84% of the work performed by outside counsel for pharmaceutical giant GlaxoSmithKline in 2015 billed under AFAs compared to just 3% in 2008. The AFA trend is a component of heightened awareness by both firms and clients to do better when it comes to pricing their legal services and reign in and predict legal spend.
Having spent 25+ years in the legal technology and specifically timekeeping and KM space, I can attest to an encouraging trend on the time recording technology side. Today, law firms are looking even more closely at the opportunities it presents. Just look at the growing number of law firms of varying size and complexity that are seeking out best-of-breed solutions to supplement existing native time and billing systems … their utility goes far beyond logging hours on mobile devices.
Not only are firm clients increasingly interested in being able to access work-in-progress in real time, law firms are looking for data sources to manage and determine availability of resources and expertise in order to competitively bid for legal work. While historical data delivers a historical price, resource availability is integral in determining accurate pricing around delivering future work.
Why do I propose modern timekeeping technology as the ‘new black’? It can leverage the traditional timekeeping capture experience to facilitate the capture of future hours (i.e., forecasting) and deliver valuable workload-type information for the firm’s project and pricing officers. While this does not seem like rocket science, there has been a long-standing disconnect between firms’ ability to mine and utilize core data pulled from time recording systems and applying that data to forecast future resources.
One thing is now crystal clear, firms that master the collection and strategic use of data will come out on top… especially as it relates to the pricing conundrum and the overall delivery of accurate and value-added RFPs and bids, focused on resource-based information.
Speaking of firm resources, data for resource availability currently does not readily exist in digital form, and there’s no streamlined way to strategically and accurately allocate and plan resources for specific matters. Balancing workloads across all of the resources in a firm is vital in order to make efficient use of existing talent and consequently maximize profitability via accurate and competitive pricing. Who is available within a given timeline based on matter urgency and time sensitivity?
Enter timekeeping … a natural fit for the recording of future workload levels via the input of forecasted hours using the same consistent user interface already in place for historical hours. The “forward entry” of time enables firms to gain insight into work patterns, areas of low usage, and areas under stress from too much work. By using comprehensive resource management dashboards, it is possible to identify such issues and more evenly distribute work or determine where tactical business development activities could fill short-term gaps.
While we see some firms already engaging in ad hoc resource management and others leveraging legal project management processes to streamline efforts, there is a tremendous opportunity to extend existing timekeeping systems as the input source for firm forecasting and accurate workload management, effective work distribution and allocation created to facilitate optimal lawyer performance and efficiency levels.
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