By Kim Gomlak, MBA & Kelly Anthony, Esq.
DATA: the ever-present concept that increasingly seems to govern businesses across every industry and discipline, including the legal profession. In the last decade, data has become more critical to operations and decisions and to the success of legal practices than was historically the case.
Specifically, structured data quantitative, in the form of spreadsheets and unstructured data qualitative in nature both play a substantial role in the business of many firms and bringing the two together can provide a significant competitive advantage. Front of mind for law practices is the valuable, unstructured data that’s pertinent to your client files helping you gather information and evidence to build each case and structured data, such as your law firm budget, advertising expenditures, billing and accounting information. Both types of data contribute to your firm as a whole, and their management plays an integral role in the success of your practice.
It may seem daunting at first, but it’s imperative to track data as you grow your business and capitalize on new opportunities. The good news is that tools for viewing and interpreting data have come a long way and make the process much more accessible to attorneys.
A good place to start with respect to data is evaluating your case management system. Below we’ve outlined why and how to get started.
Why focus on case management?
Taking unstructured data, such as intake forms and client agreements, and organizing it with the aid of a solid case management system can substantially benefit your firm in the following ways:
- Tracking client intake and the associated cost to sign up a new case
- Organizing all of your client data in one system where it can easily be extracted
- Providing real-time access to up-to-date case and client details for all members of your firm — attorneys and support staff alike
- Keeping clients informed by being able to quickly report on the progression of their cases
- Monitoring deadlines and important dates
- Protecting data and security — virtually all businesses are moving away from the ubiquitous paper trail and toward digital management of documents
How to select a system?
If you’re just starting down the path of organizing your firm’s case data, even the first step can feel like a daunting challenge. Evaluating and implementing either a new system or case management
software is an undertaking in and of itself. There are many avenues through which you can seek out information and recommendations:
- Tradeshows: if you’re attending an industry conference or tradeshow, there’s probably numerous software companies exhibiting. Use this opportunity to speak to their representatives and take part in software demos while you’re there. Seeing the software in action and being guided by someone who knows it inside and out can help you better determine if it’s a good fit for your firm. Keep in mind how your data is stored currently and who will be the primary user of the system while you do your research.
- Peer Listservs: who better to ask than your peer law firms who may already be employing a similar software? If you’re part of a listserv for your particular practice area or bar association, reach out and ask for recommendations. Most attorneys are willing to share their experiences. Remember to not only source the positive reviews, but also pay attention to the negative feedback so you can better evaluate all of the tools available to your firm.
- Trial Lawyer Associations: if you’re a member of a local, state or national trial lawyer association, don’t hesitate to leverage it as a guide for your exploration of potential solutions. Your association may have a standing relationship with a particular software vendor that has been thoroughly vetted. Or they may be able to put you in touch with another member or vendor who has expertise or extensive knowledge of software options.
- Take the time to carefully source a software solution. Not only is it likely to be a large monetary investment, there will also be a substantial investment of time to implement it. You want to be confident that in the end your firm will benefit from the effort.
How can case management help with financing your practice?
Many benefits from focusing on your law firm data are obvious (and stated above). Better data equates to more streamlined processes which in turn drive efficiency. Improved processes can also mean moreproductive and content employees. If your practice operates at its best, your clients are likely to be satisfied with your services. Satisfied customers can translate into referrals and new business opportunities.
But a less obvious positive impact of having an organized case management system may come when you decide to increase your firm’s financial resources.
Let’s say you’re going to seek out working capital so that your firm is better able to act on new opportunities as they arise. Or perhaps you want to deploy an advertising campaign to bolster your case portfolio. Many law firm financing companies tailor their resources specifically to address the challenges of contingent-fee practices. In doing so, they will evaluate your firm’s entire case portfolio in order to determine the amount of funding they can extend to you. The funder is likely to assess your assets — specifically the value of current and expected fees — to determine your financing needs and the level of risk it will absorb by lending to you. Due diligence conducted by a funder will help determine that your firm is suitable for financing and can perform under the agreement.
By having your firm’s data organized and consolidated into an easy-to-use system, you’ll likely be able to expedite the time it takes to secure financing, as well as build trust with the funder.
If you are seeking financing, try to make sure you include in your system the case caption, docket number and jurisdiction (if filed), as well as the projected settlement value for each case and the fees you believe your firm will receive, prior to supplying your funder with your case list for evaluation. The financing company will make its own assessment of the value of your cases and verify docket information through state and federal websites, but you can accelerate the process and increase your credibility by providing accurate information at the outset.
Additionally, most financers require some level of monthly, quarterly or bi-annual reporting while you are a borrower. Having processes in place from day one to precisely track the use of funds and case status will lessen the stress on your firm in having to provide this information to your lender periodically.
Your law firm client data is integral to your firm. There may come a time when you and your partners evaluate the possibility of a merger with a synergistic firm, or you may consider acquiring another firm in order to expand your areas of expertise or geographic reach. At some point later in your career you may want to take a step back from practicing and weigh the decision of selling the firm or engaging in a partner buy-out. In all of these scenarios, having a firm grasp on exactly where the firm stands in terms of its case portfolio is key. You don’t want to be pressured to get your data organized while also evaluating a major move — instead make data management a standard now and reap the benefits of doing so in the future.