Put Technology to Work for Your Firm

Today's tough economy finds many firms searching for new ways to improve profitability by increasing leverage through the use of technology. Preserving a competitive edge is crucial and can mean the difference between success or failure. Investing in the right technology, and the efficient use thereof, could help your firm weather or even thrive during the tough times ahead.

Cost Recovery Systems

Being able to capture and control costs is imperative for any firm. Routine office expenses, such as third-party research, unique office supplies, or unusually significant copies and printouts for clients are generally billed at a “flat-rate.” This may limit revenue generation and unrecovered costs. You also run the risk of overcharging your clients, possibly causing them to rethink the value of your services. Legal research and couriers can factor into the equation as well. A quality cost recovery system will enable your firm to turn these expenses into profits.

Efficiency is the key. Cost recovery systems will increase billing speed and accuracy, and most work with systems already in place. You will have the ability to track spending, which in turn will enable you to trim excess costs where necessary, and maybe even bill more for services rendered. With a cost recovery system, both you and your client are able to track expenses from inception to billing. Clients, especially those who are tech savvy, will appreciate being able to visualize the true value of the services your firm provides.

Business Intelligence

Seeking an innovative solution to how to provide the best possible services at the lowest possible cost is vital to enhancing your firm's profitability. Any growth-oriented law firm needs a way to measure both productivity and profitability. A business intelligence (“BI”) system can help your firm concentrate on the bottom line; become proactive instead of reactive, and in turn enhance client services. A BI system will enable you to not only look at historical figures but also compare those figures to the current economic environment.

Having the ability to measure past performance indicators, monitor current conditions, and foresee future trends can make a BI system invaluable to a firm. Proper costing of new business opportunities, discovering variances in budgets, severing unprofitable client relationships, and obtaining targeted realizations are just a few of the inestimable benefits provided by a BI system. Re-educating your firm to take predictive action instead of just relying on past performance indicators can take it to a new level of profitability.

Business Process Management

The business process of today's law firm is often overlooked. Document and client relationship management, as well as accounting systems and knowledge management, are important resources necessary for a firm aspiring to maintain a competitive edge. Efficiencies of data distribution and management need to be examined. Monitoring what information is being provided to your staff and how that information is being utilized is an important function. Business Process Management (“BPM”) can help you sort through data management and enhance services provided to your firm and your clients.

A fully documented control system will ensure that all necessary information is routed to the appropriate staff members. It can also ascertain that security protocols are in place and being utilized properly. Most firms are now fully automated, but how that electronically stored data is employed and distributed provides a strategic advantage. Also vital to prudent information management is staying compliant with federal and state regulations such as the Sarbanes-Oxley Act. A BPM system can supply a full audit history for auditor review.

e-BILLING

Finding a way to shorten the billing-to-collection cycle is important for any law firm. Lessening the time it takes to meet invoicing deadlines, and in turn seeing invoices paid faster, is essential to measuring your firm's productivity. e-billing gives you the opportunity to standardize and streamline the billing and collection processes. With Legal Electronic Data Exchange Standard (“LEDES”) interface software, client invoices can be sent in standard format, complete with American Bar Association codes for specific legal services.

Insurance companies and certain clients now request and/or require e-billing. Having the ability to differentiate yourself and being able to demonstrate to clients the value you deliver makes e-billing a viable option. Potential new business clients can more readily evaluate your billing protocols and methods and more easily identify efficiencies between firms. Internally, e-billing allows you to analyze trends and establish benchmarks.

Budgeting

An important function of firm managers looking to stay competitive is determining their firms' performance, productivity, and profitability. Ascertaining why certain expenses are exceeding the expected norm would generally require running a multitude of reports and burrowing through mounds of additional paperwork. Budgeting is the key to efficiently recognizing and controlling these unknown variables and is an important tool most firms overlook. A well-defined budget is capable of not just forecasting the bottom line, but also explaining performance at every level.

Presently, the art of budgeting has matured into a multidimensional tool. Interactive budgeting enables the user to plug in a range of variables and instantly see how they affect the firm's overall performance. This allows you to react quickly to financial swings and modify accordingly and immediately. Multidimensional modeling engines give you the option to cross-analyze data to assess and adjust constantly. Enhanced budgeting techniques can facilitate your decision makers in crafting real-time solutions.

Conclusion

To be competitive, firms must be able to react quickly to shifts in their business, or they risk being left behind. Implementing these technologies can take your firm to a new level of performance and set you apart from your peers. Tools for measuring profitability and productivity are pivotal for maintaining a competitive edge. A growth-oriented firm will take the time to explore what options are available and perform the necessary cost-benefit analysis to establish a well-reasoned, long-term technology strategy to keep it at the forefront.

Rebecca J. Mattick is an accountant with Seigneur Gustafson, LLP, a provider of tax preparation and planning, as well as business valuation and litigation support, located in Lakewood, CO. Mattick has more than 11 years of professional experience and specializes in taxation and commercial liability and property insurance issues. She can be reached at 303-980-1111 or www.cpavalue.com.

Today's tough economy finds many firms searching for new ways to improve profitability by increasing leverage through the use of technology. Preserving a competitive edge is crucial and can mean the difference between success or failure. Investing in the right technology, and the efficient use thereof, could help your firm weather or even thrive during the tough times ahead.

Cost Recovery Systems

Being able to capture and control costs is imperative for any firm. Routine office expenses, such as third-party research, unique office supplies, or unusually significant copies and printouts for clients are generally billed at a “flat-rate.” This may limit revenue generation and unrecovered costs. You also run the risk of overcharging your clients, possibly causing them to rethink the value of your services. Legal research and couriers can factor into the equation as well. A quality cost recovery system will enable your firm to turn these expenses into profits.

Efficiency is the key. Cost recovery systems will increase billing speed and accuracy, and most work with systems already in place. You will have the ability to track spending, which in turn will enable you to trim excess costs where necessary, and maybe even bill more for services rendered. With a cost recovery system, both you and your client are able to track expenses from inception to billing. Clients, especially those who are tech savvy, will appreciate being able to visualize the true value of the services your firm provides.

Business Intelligence

Seeking an innovative solution to how to provide the best possible services at the lowest possible cost is vital to enhancing your firm's profitability. Any growth-oriented law firm needs a way to measure both productivity and profitability. A business intelligence (“BI”) system can help your firm concentrate on the bottom line; become proactive instead of reactive, and in turn enhance client services. A BI system will enable you to not only look at historical figures but also compare those figures to the current economic environment.

Having the ability to measure past performance indicators, monitor current conditions, and foresee future trends can make a BI system invaluable to a firm. Proper costing of new business opportunities, discovering variances in budgets, severing unprofitable client relationships, and obtaining targeted realizations are just a few of the inestimable benefits provided by a BI system. Re-educating your firm to take predictive action instead of just relying on past performance indicators can take it to a new level of profitability.

Business Process Management

The business process of today's law firm is often overlooked. Document and client relationship management, as well as accounting systems and knowledge management, are important resources necessary for a firm aspiring to maintain a competitive edge. Efficiencies of data distribution and management need to be examined. Monitoring what information is being provided to your staff and how that information is being utilized is an important function. Business Process Management (“BPM”) can help you sort through data management and enhance services provided to your firm and your clients.

A fully documented control system will ensure that all necessary information is routed to the appropriate staff members. It can also ascertain that security protocols are in place and being utilized properly. Most firms are now fully automated, but how that electronically stored data is employed and distributed provides a strategic advantage. Also vital to prudent information management is staying compliant with federal and state regulations such as the Sarbanes-Oxley Act. A BPM system can supply a full audit history for auditor review.

e-BILLING

Finding a way to shorten the billing-to-collection cycle is important for any law firm. Lessening the time it takes to meet invoicing deadlines, and in turn seeing invoices paid faster, is essential to measuring your firm's productivity. e-billing gives you the opportunity to standardize and streamline the billing and collection processes. With Legal Electronic Data Exchange Standard (“LEDES”) interface software, client invoices can be sent in standard format, complete with American Bar Association codes for specific legal services.

Insurance companies and certain clients now request and/or require e-billing. Having the ability to differentiate yourself and being able to demonstrate to clients the value you deliver makes e-billing a viable option. Potential new business clients can more readily evaluate your billing protocols and methods and more easily identify efficiencies between firms. Internally, e-billing allows you to analyze trends and establish benchmarks.

Budgeting

An important function of firm managers looking to stay competitive is determining their firms' performance, productivity, and profitability. Ascertaining why certain expenses are exceeding the expected norm would generally require running a multitude of reports and burrowing through mounds of additional paperwork. Budgeting is the key to efficiently recognizing and controlling these unknown variables and is an important tool most firms overlook. A well-defined budget is capable of not just forecasting the bottom line, but also explaining performance at every level.

Presently, the art of budgeting has matured into a multidimensional tool. Interactive budgeting enables the user to plug in a range of variables and instantly see how they affect the firm's overall performance. This allows you to react quickly to financial swings and modify accordingly and immediately. Multidimensional modeling engines give you the option to cross-analyze data to assess and adjust constantly. Enhanced budgeting techniques can facilitate your decision makers in crafting real-time solutions.

Conclusion

To be competitive, firms must be able to react quickly to shifts in their business, or they risk being left behind. Implementing these technologies can take your firm to a new level of performance and set you apart from your peers. Tools for measuring profitability and productivity are pivotal for maintaining a competitive edge. A growth-oriented firm will take the time to explore what options are available and perform the necessary cost-benefit analysis to establish a well-reasoned, long-term technology strategy to keep it at the forefront.

Rebecca J. Mattick is an accountant with Seigneur Gustafson, LLP, a provider of tax preparation and planning, as well as business valuation and litigation support, located in Lakewood, CO. Mattick has more than 11 years of professional experience and specializes in taxation and commercial liability and property insurance issues. She can be reached at 303-980-1111 or www.cpavalue.com.