April 01, 2018

SPONSORED CONTENT ● Two Studies Reveal How You Can Have Both More Time and More Money

Thomson Reuters
Thomson Reuters is a sponsor of the ABA Solo, Small Firm and General Practice Division. Neither the ABA nor ABA entities endorse non-ABA products or services. This article should not be construed as an endorsement.

 

Have a life or make more money?

It’s the classic solo-attorney dilemma. You sell your time, so the more time you spend at work, the more money you’ll make according to conventional wisdom.

But recent studies by Blue Hill Research and Thomson Reuters challenge this mind-set. According to the findings, you could conceivably give yourself a 9 percent raise while working 17 hours a month less.

What Makes Success? Working 17 Fewer Hours Per Month

According to the Thomson Reuters 2017 State of U.S. Small Law Firm Study, which analyzed 300 solo and small law firms, 42 percent of general practice attorney time is spent on non-billable work instead of practicing law. When put into context, that 42 percent would mean:

  • You’re working for free after 2 p.m. every single day.
  • Every week, you’re not getting paid for any work after Wednesday afternoon.
  • None of the work you do all year is billable until May 26.

The study also revealed that firms identifying themselves as successful were spending 4 percent more of their time practicing law than firms identifying as unsuccessful. While 4 percent is a narrow gap, breaking down the hours reveals the impact this difference would have on your practice and your life.

If you want to reach 1,800 billable hours a year you would have to work:

  • 3,100 hours if you’re unsuccessful
  • 2,900 hours if you’re successful

That’s 200 hours more a year, or 17 hours more per month, that unsuccessful firms have to work to hit the same billable target.

 

How to Reach Your Target for Billable Hours Faster

Often what detracts from practicing law (and the billable hours that come with it) are tasks such as time and billing, matter management, legal calendaring, and financial reporting. The good news is that much of this work can be automated or streamlined to reduce your time commitments on these activities. The Matter Management Checklist for Overworked Attorneys can help you understand how to achieve this.

Also consider the advice of Heidi Alexander, director and law practice advisor for the Massachusetts Law Office Management Assistance Program. She regularly provides matter management tips to attorneys and advises using law practice management systems to reduce the time they spend on non-billable work.

This is good advice that solo attorneys should take to heart. However, the Thomson Reuters study found that while attorneys are challenged with tasks related to running the business of their firm, most of them aren’t doing anything about it. For instance, only:

  • 19 percent are looking for ways to reduce time spent on administrative tasks
  • 26 percent are identifying how to control costs and expense growth
  • 28 percent are seeking to improve internal efficiency

This means there’s great opportunity for solo firms that are willing to embrace change and focus on improving overall efficiency. By taking action they’ll be ahead of a marketplace that chooses to do nothing. And chances are their effort to spend less time on administration, improve efficiency, and control expenses will result in more time spent on billable work without more time at the office.

If that’s what you want, it’s worth taking a minute or two to peruse the Matter Management Checklist for Overworked Attorneys.

 

How to Gain 9 Percent More Revenue Without Longer Hours

Still not convinced? Consider what Blue Hill Research discovered when they surveyed more than 50 general practice firms, ranging from one to ten employees. Keep in mind that these firms already had some kind of technology in place to help manage their practice. Blue Hill Research wanted to find out the impact of technology and, in the process, they discovered that general practice firms using an integrated practice management solution on average:

  • Achieved 9 percent higher annual billings
  • Conducted 12 percent more matters with a high rate of client satisfaction
  • Gained 71 percent more referrals

Integrated practice management allows attorneys to work across their entire work flow with one login without requiring outside applications or support. This includes activities such as client intake, matter management, research, calendaring, billing, and client communication. Contrast this with cobbling together disparate applications that weren’t originally developed to work with each other.

The report explains that firms achieved these gains because they used the technology more often than firms that didn’t have an integrated practice management solution. Specifically, they used it:

  • 44 percent more for invoicing and collections
  • 82 percent more for matter management
  • 130 percent more for case assessment and planning
  • 360 percent more for case analysis

Again, Blue Hill compared firms that already use some kind of technology to manage their practice. Imagine what the improvements in billings, satisfaction, and referrals might be possible for firms that don’t already have a practice management solution in place.

What both studies tell us is that time and money aren’t mutually exclusive—you can defy convention and have it all.

Find out how here: Matter Management Checklist for Overworked Attorneys.

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Thomson Reuters