March 25, 2020

The Top Four Facts Law Firm Leaders Need to Know About LPM (Part 2 of 2)

Fact 2: Experts disagree about the best way to define LPM (cont. from Part 1)

In defining LPM, we believe that lawyers must take a systematic approach that is closely related to the Agile approach to project management.  Stated simply, we encourage lawyers to use an iterative process that focuses on key LPM issues, one at a time, in their order of importance.

In an article entitled “Agile: A Non-traditional Approach to Legal Project Management,” Kim Craig, then SeyfarthLean’s global director of legal process improvement, and Jenny Lee, a senior project manager with Seyfarth, explained why Agile is particularly relevant to the legal profession:

Traditional project management focuses on robust, comprehensive, mandatory project documentation with lengthy project charters, detailed project plans, complex status reports and rigorous, formal change control logs… [But] the world of legal service delivery is fast-paced and unpredictable. In legal matters, we cannot possibly know everything that will be involved with litigation at the outset. Developing an overall strategy is generally common practice, but detailed, cradle-to-grave planning is impossible.[1]

Agile contrasts with the more traditional approach to project management which holds that every project should start with a well-defined plan.  Only after that is completed and approved do you begin working your way to the end, one sequential step at a time.  

The traditional approach is also known as the “waterfall” approach because progress is seen as flowing steadily from the top to the bottom (as in a waterfall).  It typically sees projects in terms of five key phases or steps such as:

  • Analysis
  • Design
  • Implementation
  • Testing
  • Evaluation

In some cases, firms have hired LPM Directors based on their “waterfall” project management experience in construction, government contracting, and other areas where traditional techniques are used and Agile techniques are not.  This has led to many stories of LPM Directors who could not or would not adapt to a legal environment, and who ended up working with the very small group of partners that were interested in project charters and Gantt charts.

So, if anyone tells you that LPM is defined by five steps such as analysis, design, implementation, testing and evaluation, beware.  They are describing the traditional waterfall approach, not the Agile approach which applies better to lawyers. As the old cliché says, “you won’t get a second chance to make a first impression,” and attempts to apply the traditional waterfall approach have set back the cause of LPM at many firms.

Fact 3:  LPM success requires long-term managerial support

In our work with hundreds of law firms, we’ve seen the importance of follow-up over and over again.  In every single case where we have seen a firm make significant LPM progress, it was led by influential partners or members of the executive committee who were strong believers in LPM.  In a few cases, we’ve seen LPM programs make an enormous amount of progress when they were led by a powerful internal champion, and then slow to a crawl when that decision-maker left the firm.

Many firms have individual lawyers or practice groups that are quite advanced in LPM, but in our opinion not a single law firm in the world can yet say that LPM has truly taken hold across the entire firm. LPM aims to change habits that have been reinforced over decades, and to help firms constantly adjust to evolving client demands.  Having long-term managerial support is critical to success.

Fact 4: Law Firm Partners Don’t Know What to Do Differently

According to Altman Weil’s 2019 Law Firms in Transition Survey (LFiT, p. 44), most law firm partners (60%) don’t know what to do differently, and that’s why law firms aren’t doing more to change the way they deliver legal services. That might also explain why most law firm partners (69%) resist most change efforts (LFiT, p. 44).

If you’re a law firm leader who wants to make positive changes at your firm, you absolutely must be able to demonstrate how things can be done differently, and with positive results. At LegalBizDev, we have been successfully coaching lawyers in LPM over the past decade. In this way, we help law firm partners become internal LPM champions who advocate for LPM by sharing their success stories with other lawyers at the firm.

This blog series was adapted from the fifth edition of the Legal Project Management Quick Reference Guide, an online library of LPM tools and templates which is updated twice a year.


[1]   Kim Craig's article originally appeared in the International Legal Technology Association’s (ILTA’s) December 2013 white paper titled, “Business and Financial Management: Wrangling the Wild Ride.”

March 11, 2020

The Top Four Facts Law Firm Leaders Need to Know About LPM (Part 1 of 2)

Law firm leaders who are interested in legal project management (LPM), but too busy to dig into the details, should focus on the four critical facts presented in this 2-part blog series.

Fact 1:  Clients want LPM

Any law firm that has responded to an RFP in the last few years knows that client requests for LPM are growing rapidly.

Similarly, survey after survey has shown that legal clients are seeking greater efficiency from firms.  For example, in its 2019 Chief Legal Officers (CLO) Survey (p. 49), Altman Weil provided 238 CLOs with a list of ten possible service improvements, and asked “please select … [the improvements] that you would most like to see from your outside counsel.”  The top three things clients want were all closely related to LPM:

  1. Greater cost reduction (58%)
  2. Improved budget forecasting (40%)
  3. Non-hourly based pricing structures (33%)

Even when clients fail to ask for LPM by name, the results that clients are looking for definitely fall under the term, including minimizing surprises.

If you believe that your clients are different and that they care only about legal quality and not about cost, consider yourself very lucky. But note that if you are wrong, you are at risk of losing these clients to competitors who focus on improving service with LPM.

Fact 2:  Experts disagree about the best way to define LPM

There is widespread agreement that clients want LPM and that it can pay off for firms by protecting business and increasing realization and profitability. But experts still disagree about exactly how LPM should be defined. These arguments have slowed LPM’s progress, as seen in this quote from an AmLaw 200 firm leader from one of our past surveys (p. 89):

We were just at a board meeting last week where we were talking about whether we should do formalized project management training. My answer to that is obviously yes, we absolutely should. But first we need to agree on what legal project management is.

For years, we have argued for a broad definition that embraces a very wide range of management techniques, including pricing, communication, process improvement, and much more:  LPM increases client satisfaction and firm profitability by applying proven techniques to improve the management of legal matters.

By our definition, any lawyer who has ever planned a budget or managed a team has served as a legal project manager. But what was “good project management” for lawyers a few years ago is no longer good enough. Clients are now choosing law firms based on their ability to apply a more systematic and disciplined approach that delivers more value more quickly.

Our systematic approach to LPM revolves around improvements in eight key areas:

  1. Set objectives and define scope
  2. Identify and schedule activities
  3. Assign tasks and manage the team
  4. Plan and manage the budget
  5. Assess risks to the budget and schedule
  6. Manage quality
  7. Manage client communication and expectations
  8. Negotiate changes of scope

The key to success in delivering more value more quickly is to find the “low-hanging fruit”:  The management tactics that are most likely to help each individual to increase value and/or profitability.

As Barbara Boake and Rick Kathuria summarized in their book Project Management for Lawyers (p. 14):  “project management is a tool box—choose only what you need to most effectively manage [each] project.”

In part 2 of this blog series, we will discuss how our approach to LPM is similar to the Agile approach to project management, and how LPM success requires long-term managerial support.

This blog series was adapted from the fifth edition of the Legal Project Management Quick Reference Guide, an online library of LPM tools and templates which is updated twice a year.

February 26, 2020

Online LPM Library of Tools and Templates: Frequently Asked Questions (Part 2 of 2)

In part 1 of this blog series, we explained how our online library of LPM tools helps law firms implement a robust internal LPM coaching program, and we also listed several benefits firms have experienced when using this resource.  In Part 2, we describe what your firm can expect if it licenses our online LPM library.

What specifically does the license include?

We will help you develop a well-defined program that fits your firm’s culture and resources. This will increase buy-in by helping to ensure that lawyers use the tools to increase efficiency, client satisfaction, and profitability at your firm.  Specifically, each license includes:

  • Unlimited, non-exclusive rights to reproduce and adapt all of the content within your firm and with your clients for one year (renewed annually)
  • Separate files for each tool (in both Word and PDF format) so you can easily deliver just the information a particular lawyer needs in your preferred format, and so you can customize existing templates to meet your firm’s needs
  • New tools and templates that are released to license holders every June and December
  • Consultation with the authors of these tools to maximize the value to your firm, ensure quick wins, and establish a foundation for future success
  • Sample emails for use by the managing partner or another senior partner announcing the availability of these tools and their benefits to the firm and to individual lawyers
  • Twelve “LPM tips of the month” each year, for publication on your intranet, internal newsletters, or email to remind lawyers of the value of this resource
  • A proven method for hosting and facilitating a lawyer panel discussion to help promote the use of the online LPM resource among firm lawyers
  • A suggested menu structure that can be adapted to your intranet

Tell me more about the consultation that’s included with the license.

Each license includes four hours of consulting support, plus materials to help build a stronger culture of LPM within your firm, including:

  • Specific tasks, objectives, and timelines for using these LPM tools and templates
  • Systems to provide exactly the information lawyers need, precisely when they need it
  • A list of the top ten tools that have proven most useful in implementing LPM, and the top ten tools that are most effective in introducing LPM concepts
  • Guidelines for prioritizing which lawyers to focus on first when introducing LPM tools
  • Suggestions for working with LPM champions, practice group leaders, and LPM Directors
  • Tips for designing an internal program to publicize successes, including sample “LPM Tips of the Month”
  • Guidance on how to save time developing firm-specific processes and procedures by customizing our templates
  • Suggestions on how to customize our tools for in-firm presentations and training

What are the contents of the online LPM library?

A complete list of the current LPM tools and templates can be found on our website

All files are delivered in both Word and PDF format so that they can be made available on your firm’s intranet, and, when necessary, customized to fit your firm’s or practice group’s needs. 

New tools and templates are added every June and December so that lawyers can easily keep up with developments in this rapidly changing field.

How much does it cost to license the resource?

The answer to this question depends upon the number of lawyers at your firm.  If you want a customized quote, please contact us at info@legalbizdev.com. 

What we can tell you is that this online LPM library can offer a rapid return on investment. As soon as one lawyer who is responsible for a large engagement adopts an LPM best practice, the return on investment can quickly exceed the license cost by, for example:

  • Increasing the accuracy of an initial fee estimate and the likelihood of payment in full by using the template “15 questions to ask clients to help define scope”
  • Renegotiating a fixed fee by using the template “Prepare and negotiate for approval of a scope change”
  • Using any of the more than 170 tools and templates in the online library to increase client satisfaction and/or firm profitability

What else can you tell me about this resource?

Four previous editions of these tools have been tested and refined in firms around the world that encompass over 100,000 lawyers.  Additional details can be found on our website, including:

  • The names of more than 35 contributing authors from both large and small firms, including Baker McKenzie, Morgan Lewis, WilmerHale, Pepper Hamilton, and Bilzin Sumberg
  • The names of 25 LPM experts who currently serve on our Board of Advisors, including representatives from Norton Rose Fulbright, Lathrop Gage, Baker Botts, Winston & Strawn, and K&L Gates
  • Testimonials from 22 additional LPM experts at firms such as Perkins Coie, Jackson Lewis, Ballard Spahr, Orrick, and Saul Ewing

February 12, 2020

Online LPM Library of Tools and Templates: Frequently Asked Questions (Part 1 of 2)

In over a decade of research and consulting with hundreds of law firms, we’ve seen that one-to-one coaching is the most effective way to accomplish the goal of increasing LPM results. To assist legal professionals in implementing LPM tactics, it is imperative that law firms have a proven and effective way to easily provide LPM resources to their lawyers and legal staff when they need it. 

This blog series explains how our online library of LPM tools and templates can help your firm implement a robust internal LPM coaching program, as well as what your firm can expect if it purchases our license.

Note:  Although we use the term “LPM coaching” in this blog series, it does not matter whether your firm adopts that terminology or not.  Whatever your firm calls it, and however your firm does it, the critical element for increasing LPM results is to implement a program that changes the behaviors of your firm’s legal professionals.

Why use just-in-time training materials like our online library?

The primary goal of any LPM coaching program is to help legal professionals apply LPM tactics quickly to find “low hanging fruit” and directly experience such immediate benefits as (1) increasing realization and profitability, (2) reducing risk, (3) protecting current business, and (4) increasing new business. 

As explained in our white paper, The Keys to Legal Project Management Success, the five most effective ways to increase LPM results are to:

  1. focus on changing behavior and solving problems
  2. aim for quick wins to create internal champions
  3. publicize successes within the firm
  4. use just-in-time training materials; and
  5. take action now and follow up relentlessly.

A critical component of any LPM coaching program is to provide legal professionals with the resources they need “just-in-time” to help them resolve real-world challenges they face on a daily basis.

In most professions, “just-in-time” training materials like ours have become the standard way to teach new skills. For example, when people need to use an unfamiliar feature of Microsoft Word, very few would consider taking a class or looking it up in a manual.  Instead, they simply look it up online, exactly when they need it.

Although LPM coaching is the most effective way to change lawyer behavior and achieve quick wins, there are a number of different ways that LPM coaching programs have been structured internally at law firms.  Regardless of the approach, however, it is essential that law firms have a proven set of LPM best practices to offer to their legal professionals. 

Our LPM tools and templates have been developed and refined over thousands of hours in our one-to-one LPM coaching programs.  Our online LPM library provides LPM Directors, LPM coaches, champions, group leaders, and others with over 170 tools and templates that have been proven to increase client satisfaction and firm profitability.  Each license also includes consulting support and supplemental materials to ensure that lawyers actually use the materials.

Who should license the online LPM library?

Any law firm that is interested in changing the behavior of its legal professionals to implement LPM practices should consider licensing this library.  It is absolutely critical for firms to have an online LPM resource if they want to provide “just-in-time” LPM training materials to lawyers and legal staff.  A key question then is whether firms want to “reinvent the wheel” and develop these materials on their own or license them. 

To create a quality online LPM library takes thousands of hours of time over several years.  It makes sense that firms would want to rely upon proven LPM best practices, and they would want to obtain the “know how” to promote and implement an online LPM library in a way that ensures it is actually used by firm lawyers.  Instead of paying to reinvent the wheel, firms can now start from a proven foundation that has helped thousands of lawyers. 

What are the general benefits of licensing the online LPM library?

Law firms have reported the following benefits as a result of licensing the online library:

  • Internal LPM coaches, LPM champions, practice group leaders, and others provide lawyers with exactly the information they need to increase efficiency, exactly when they need it.
  • Lawyers can directly access all the LPM tools on the firm’s intranet, and can download the information from their laptop, tablet, or phone, whether they are in their office, on an airplane, or in a hotel room.
  • Firms save time and increase results by building their LPM efforts on a proven foundation that has been developed and tested over many years.
  • Firms keep up with the latest developments in this rapidly changing field, as new tools and templates are added to the library twice a year.
  • The library multiplies the effects of firm LPM initiatives by helping LPM Directors, practice group leaders, and others provide more lawyers with more help more quickly.
  • Firms improve client relationships by sharing LPM tools with key clients.
  • LPM staff use the online library to create more awareness by sending LPM tips of the month to lawyers throughout the firm.
  • LPM staff introduce key LPM concepts by demonstrating how to use the online library at practice group meetings, firm retreats, and in other settings.

In Part 2 of this blog series, we will describe what your firm can expect if it licenses our online LPM library.

January 29, 2020

Case Study: An Integrated Approach to Providing Clients with Greater Value (Part 2 of 2)

By Tim Batdorf and Jim Hassett

Q: In the first part of this post, we talked about the big picture of your approach, and the success it has produced. Now let’s go into the nuts and bolts, and discuss how the matter management side of your team operates.

A: The matter management team is a small but mighty part of our group. In many ways, it is the glue that holds the group together. Once we agree with clients about pricing, the matter management team takes over and is involved for the rest of the matter. It makes sure we properly track and manage what we’ve agreed to and communicates with the client about what is happening. It also helps drive all of the client technology we are building. It talks to our internal and external clients about what they need and develops the requirements that help our technologists build solutions.

When I came to Ballard Spahr four years ago, many of our interactions with clients centered on the pricing function. That’s why it’s so great that the matter management team now plays a prominent role. While pricing is incredibly important, once matters are underway our clients also want to know how we deliver on what we agreed to. If we don’t engage in matter management, costs quickly escalate. This can jeopardize client relationships and affect the firm’s bottom line.

Q: That’s very interesting. As you may remember, several years ago we interviewed 15 LPM Directors, including you, about how their job was defined. At that time, most spent more time on setting prices for new matters than on managing the work to help assure that lawyers stayed within these budgets. We concluded that (p. 298 in the fourth edition of our Legal Project Management Quick Reference Guide), “in our opinion, improving the management of existing matters would lead to a faster financial return [than improved pricing].”

A: I completed your Certified Legal Project Manager® program and received tremendous benefit from it. I agree that matter management is absolutely essential.

Ballard Spahr has a requirement that attorneys must submit budgets for the majority of their matters when we open them. This requirement encourages us to take a disciplined approach to managing our matters from day one. The budgets go into our matter management application, which gives our attorneys real-time access to the matter to see budget-to-actual information. One of the challenges we face, however, is that budgets are iterative and often change over time. This is where the matter management team comes in. It takes an active role in working with our attorneys on updating budgets, setting up phase and task codes that track budgets, monitoring, reporting on, and actively managing ongoing matters. The team helps attorneys proactively address with clients out-of-scope issues that may arise.

Q: The function of the value-based pricing team seems obvious from the title. Is there anything you’d like to add?

A: The pricing team plays a crucial role in our department and is often involved with matters before they come in. The team works with our attorneys to identify the diverse team members who will be responsible for working on the matter or matters and to model several pricing options from which clients can choose. During the RFP process, team members are often also involved in communicating the benefits of our program to clients and demoing our Ballard360 client technology.

Q: What about the data management part of the team?

A: Our data management team is busy right now working on an enterprise data warehouse that combines all of the firm’s data and stores them in one place. One of the challenges clients and law firms have is that we collect a lot of data that go unused or are difficult to use. The data warehouse combines and normalizes data from all firm applications and many of our vendor applications. Having the data warehouse helps us build dashboards with more sophisticated reporting and data analysis capabilities. Our goal is to move away from simply providing our clients with data and having the conversation end there. We want to be seen as a strategic partner to our clients. That means using data analytics and information we’ve gained on client and industry trends to make recommendations regarding how clients should approach business issues and manage client matters. In 2020, we also will focus more heavily on how we can incorporate more artificial intelligence (AI) and machine learning into this process.

Q: And what about the practice technology team?

A: Our practice technology team is an interesting group because it includes IT Developers and Legal Solutions Architects, who are trained lawyer technologists. The Developers help us start conversations with our clients about what they want in terms of technology, and then build and implement that technology. We follow an iterative process that we constantly modify and improve based on feedback obtained from clients. Current projects include client extranets, document automation, case management, and financial and knowledge management dashboards.

Q: Do the four teams work together?

A: Absolutely! It’s essential. The key is having constant conversations and interactions with one another so that we are all rowing the same direction and share the same vision for how to get there. Having team members who are focused on different aspects of pricing, matter management, data, and client technology is extremely valuable. Suppose there’s a complex commercial litigation matter that requires an annual fixed fee with a collar. It’s unlikely that the IT developers or data people are going to understand the way the matter needs to be priced, set up, or managed, but other members of the team do. Once the matter is in the door, and is up and running, then the data and technology teams step in to help us implement Ballard360 technology for the client that delivers cost-effectiveness, value, and efficiency. Having a diverse team that works together so closely is how we move the needle to quickly and proactively support our clients and address issues that arise.

Q: Can you give me another example of this collaboration?

A: We’re now using client portals to manage our real estate transactional work. We build an extranet site for each new matter, upload the tasks that will be required, and use a color-coding system to manage the tasks related to the matter. This allows the Ballard team, the client, the borrower, and third parties to communicate and exchange documents and information relating to the matter. It's an extremely efficient, cost-effective, and interactive way to manage deals.

Q: Has your view of LPM changed as you’ve worked with this group over the last few years?

A: My view of LPM has definitely evolved over the years. When I first started doing LPM, my primary focus was scoping, budgeting, and budget-to-actual reporting. I then started to focus on process improvement efforts. Now, we do both, but we’ve incorporated a focus on using technology and data analytics to manage our matters. I view LPM as a tool kit you use to manage matters. Some matters need all the tools we have to offer, while others need only one or two.

Q: You referred to the matter management subgroup as “the brains behind the entire client-value innovation function.” Would you say they are the most important piece of the puzzle?

A: LPM is definitely important, but it’s just one of the ways our team provides value to clients. Each person’s role on the team is important, and the team is doing amazing things. I am excited to see where we go in the next year or two.

Q: Where do you predict you will be focusing most of your energy and resources in the next year or two?

A: The team’s importance is growing because what we are doing is so vital to clients. We may need to continue to grow or borrow resources at the firm to support this demand in a strategic way. We’re also doing great stuff with technology, and the team’s work is paying off. What we are doing next year at this time will probably look completely different. More to come!

January 15, 2020

Case Study: An Integrated Approach to Providing Clients with Greater Value (Part 1 of 2)

By Tim Batdorf and Jim Hassett

This post is based on a recent interview with Melissa Prince, the Chief Client Value and Innovation Officer at Ballard Spahr, a nationwide firm with more than 650 attorneys in 15 offices. She oversees the firm’s award-winning Client Value and Innovation Program, which focuses on creating a customized client experience centered on value, cost predictability, and efficiency. Under Melissa’s leadership, Ballard Spahr was named to the Financial Times’ “Most Innovative Law Firms: Business of Law” list, a BTI Consulting innovation “Mover and Shaker,” and a finalist for the American Lawyer Industry Awards for best law firm/client team and best business team.

Q: Let’s start with a 10,000-foot view of how your group is organized, and your role.

A: I head Ballard Spahr’s Client Value and Innovation Program, and oversee the pricing, matter management, practice technology, and data management teams at the firm. Our group includes more than 20 business professionals with legal, finance, technology, data science, and project management backgrounds and certifications.

Q: And how does the Client Value and Innovation Program fit into Ballard Spahr’s organizational chart?

A: We are a stand-alone department that reports to the Executive Director and works closely with the firm’s Chair, Managing Partner of Finance and Operations, Strategic Planning Partner, Board, and Executive Team. The degree of support we have at the top is a key factor in the department’s success. We engage in rigorous planning when we take on new clients and engagements. We perform detailed scoping exercises, select diverse team members to handle each matter, prepare budgets, and provide clients with fee arrangement options. Each new arrangement is reviewed and approved by our Managing Partner and legal department leadership. Since we started our program several years ago, the team has earned the respect and trust of our attorneys. They understand that the process has leadership support and is tied to the firm’s long-term goals and strategy. 

Q: Before we get into the details of how this works, let’s briefly jump to the bottom line: Has your group been able to produce clear evidence of financial success?

A: Absolutely. One of the easiest places to see this is in our role in growing existing and new client partnerships. For example, several years ago one of our clients—a Fortune 500 company that was working with several hundred law firms at the time—decided to increase efficiency and cost predictability by consolidating all of its legal work with just a few firms. It put out a request for proposal (RFP) to select the firms that would handle all its legal work.

Ballard Spahr was chosen as a finalist. The client selected us not only because of our legal experience but also because of our sophisticated capabilities in pricing, matter management, and client technology, which other firms did not have. Much of what we talked about in the client interview meetings was how we intended to price and manage matters, because that was incredibly important to the client. We made a commitment to budgeting and managing the client’s matters and thinking innovatively about the service we could deliver.

The client named Ballard Spahr to a panel of just three firms to handle all its legal work. At the time we responded to the RFP, we had done a limited amount of work with this client. Within the first year after the RFP, however, the work quadrupled. It is a huge success story for our group and the firm. And it is one of many success stories I can point to that demonstrate the value of what Client Value and Innovation is doing.

Q: Did the process of working with this client change your approach in any way?

A: We customize our approach to each client’s needs, and the experience with this client definitely helped us realize that we need to focus more heavily on managing client relationships for larger firm clients.

The problem with law firms is that administrative functions often are siloed, and it’s hard to get everyone to work together closely and communicate about what’s happening. When we started to onboard new matters for this client, we quickly realized that we needed a single point of contact at our firm to ensure that matters were set up properly, to develop budgets, report on monthly accruals, and to help with matter management.

Our matter management team stepped in and now plays a central role in overseeing this process. We understand what’s going on in every matter. We work with the lawyers to manage each matter to make sure we stay within budget, comply with the client’s outside counsel guidelines, and bill the matter the right way. We developed real-time budget-to-actual reporting so that the client can see exactly what's going on at all times, and can be proactively involved in making decisions about its matters. We also worked with the client to develop a quarterly financial report template used by all of the client’s law firms, which provides portfolio- and matter-level details and compares financial performance and cost savings. The client also can see the value-adds that firms are providing, such as secondments, CLEs, pro bono work, advice and counseling, and technology.

The matter management group has direct contact with the client and has, in essence, become the client relationship manager on the business side. We also work directly with the attorneys managing the legal work to ensure that we are doing everything we can to develop the client relationship.  

Q: Do you think that this kind of client-facing role for Legal Project Management (LPM) teams will grow at your firm and at others?

A: I do. In the world we live in, clients are driving change at law firms. Clients with larger legal departments now have legal operations people who expect law firms to have business people in similar roles who speak their language and help manage their matters. Clients with smaller legal departments or “teams of one” that don’t necessarily have a dedicated legal operations function also appreciate that firms like Ballard Spahr have invested in resources, like our team has, to provide support. Our team is much more client-facing than we were even a couple of years ago. I now meet with several clients a week to hear about their needs and work with them to develop pricing, matter management, and technology solutions. I think the importance and the client-facing nature of my role and others like mine will only continue to grow.

In part 2 of this blog series, we will spotlight how the matter management team and other teams at Ballard Spahr operate to provide award-winning client value and innovation.

January 01, 2020

Legal Project Management: 2019 Year-In-Review (Part 2 of 2)

According to law firm leaders, efficiency is here to stay.  86% say that a focus on practice efficiency is a permanent change in the legal marketplace.  Efficiency ranked number one among 18 different trends (p. 1, LFiT).  

So, what tactics do law firms use to increase efficiency?  It appears that the most effective tactic is rewarding efficiency and profitability in compensation decisions.  A solid majority (62%) report that they experienced a significant improvement in firm performance when using this tactic (p. 23, LFiT).  This is also consistent with common sense.  If you pay someone to do something, they’re more likely to do it.

But digging deeper into the details presents a more nuanced story.  When asked about several different efficiency tactics, a large percentage of law firm leaders said it was “too soon to tell” (p. 22, LFiT) which means they didn't have sufficient information to respond in a meaningful way.

If we eliminate those respondents who said it was “too soon to tell,” and if we focus exclusively on those who have sufficient experience to provide a knowledgeable response, we find that:

  • The LPM tactic of systematically reengineering work processes is highly effective, with 91% saying it resulted in a significant improvement in firm performance.
  • This is closely followed by the tactic of rewarding efficiency and profitability in compensation decisions, at 89%.
  • Providing ongoing project management training and support is also highly effective, with 86% of law firm leaders saying it resulted in a significant improvement in firm performance.
  • Other tactics such as: (i) using technology tools to replace human resources, (ii) using non-law firm vendors, and (iii) implementing a formal knowledge management program were also found to be effective at rates of 81%, 80%, and 76%, respectively.

In essence, what this data tells us is that each one of these efficiency tactics works the vast majority of the time.

But despite these successes, very few law firms are serious about changing the way they deliver legal services.  Based upon responses from law firm leaders, only a small handful of firms (less than 2%) are doing everything they can to change the way they deliver legal services.  Roughly one-third of law firms (34%) are moderately serious about changing their behavior, and nearly two-thirds of law firms (64%) show little to no interest in changing how they deliver legal services (p. 42, LFiT). 

Why are so many firms so slow to change?  First and foremost, partners don’t want to change.  69% of law firm leaders say that partners resist change efforts.  Even when partners are willing to change, a solid majority (60%) say that partners are unaware of what they might do differently (p. 44, LFiT).  And when a law firm attempts to implement LPM, it takes time to determine whether the program is working.  A slim majority of law firm leaders (53%) said it is “too soon to tell” whether their ongoing project management training and support programs have resulted in a significant improvement in firm performance (p. 22, LFiT).  Despite these challenges, most law firm leaders (54%) say that the urgency to change has increased over the past two years (p. 43, LFiT).

*****

At LegalBizDev, we believe that if a law firm aggressively seeks to implement an LPM program and works to change lawyer behavior, it can make great strides towards resolving the challenges described in this blog series.  For example, understanding what the client wants and communicating value to the client improves client service.  Being a leader in LPM serves as a differentiator.  Actively managing legal matters using a variety of LPM tactics helps ensure that financial data is used correctly and that AFAs are profitable.  LPM coaching helps lawyers overcome resistance to change and understand what they can do differently to become more efficient and profitable.

Even without considering any of the data presented here, it is crystal clear to most law firm leaders that clients want lower costs and greater efficiency.  Our experience is that LPM helps law firms provide these benefits to clients, and this is supported by independent survey data.  The firms that provide these benefits effectively are the ones that are most likely to be profitable in coming years.

LegalBizDev is currently offering complimentary “LPM trends” webinars to LPM decision-makers to discuss this information in more detail, including new data as it is released in 2020.  If you’re interested in a complimentary 30-minute webinar, email us at info@legalbizdev.com or call 800-49-TRAIN today.

December 18, 2019

Legal Project Management: The Year-In-Review (Part 1 of 2)

In 2019, three major papers were published summarizing data collected from over 500 law firms and 250 law departments: 

  1. Altman Weil’s Law Firms in Transition survey (“LFiT”)
  2. Altman Weil’s Chief Legal Officer survey (“CLO”)
  3. The CITI Client Advisory report (“CITI”)

Based upon these reports, and also upon the multiple webinars, interviews, and informal discussions that we held with LPM decision-makers in 2019, we believe that law firm leaders should concentrate on five key issues to improve profitability, as discussed below.  One of our major takeaways from 2019 is that, if a law firm aggressively seeks to implement an LPM program and works to change lawyer behavior, it can make great strides towards resolving the challenges described in this blog series.

(1) For non-hourly alternative fee arrangements (AFAs), increase efficiency to reduce costs

It’s difficult to obtain unanimous agreement on anything, particularly among law firm leaders.  But not a single leader predicted that there would be a decline in the use of AFAs in 2020 (p. 8, CITI).  A huge majority (87%) predicted that the use of AFAs will increase in 2020, while 13% said that the use of AFAs will remain about the same (p. 8, CITI). 

From the client perspective, CLOs consistently report that one of the best management techniques for improving outside counsel performance is to negotiate fixed, capped, or alternative fees.  Over 75% of CLOs say that the use of AFAs significantly improves outside counsel performance (p. 47, CLO).  This too suggests that the use of AFAs will increase in 2020.

But any firm that has ever offered a fixed fee knows how easy it is to lose money on them.  The key to maintaining financial performance is to increase efficiency, so that the work can be completed at or below what it would have cost at standard hourly rates.  And this in turn will require significant improvements in LPM at most firms.

(2) To reduce discounting, law firms must accelerate the use of LPM

We were floored when we read the statistics on the percentage of legal fees that are derived from discounted hourly rates.  “Nearly one in five law firms (18%) receive 50% or more of their legal fees from discounted hourly rates” (p. 27, LFiT) [emphasis added].

Altogether, just over 75% of law firms receive a substantial portion (11% or more) of their legal fees from discounted hourly rates.  A paltry 2% of firms receive the full amount that their lawyers charge.  Amazingly, 3% of law firms do not collect this data and have no idea what percentage of their legal fees are derived from discounted hourly rates (p. 27, LFiT). 

Large firms offer more discounting than smaller firms.  The median for firms with 250 lawyers or more is that 41% to 50% of legal fees are derived from discounted hourly rates, while the median for firms under 250 lawyers is 11% to 20% (p. 27, LFiT). 

These results are validated by CLOs.  The number one strategy for controlling law department costs (at 57%) is to receive reductions on hourly rates from outside counsel (p. 26, CLO).

If law firms want to reduce discounting, their lawyers must embrace LPM.  The more efficient a lawyer or legal team becomes, the more valuable their time becomes (when compared to lawyers at other firms), which reduces discounting.  Moreover, the LPM tactic of properly delegating work ensures that the right person is handling the work, which again establishes efficiency and reduces discounting.  And even when clients are simply unwilling to pay standard hourly rates, LPM allows firms to increase profitability by embracing fixed fee work and using LPM tactics to ensure that matters are managed profitably. 

(3) Use LPM to better utilize financial data and increase profitability

Survey results confirm that most law firms are investing time and money obtaining better financial data.  For example, 52% of law firms have invested money to develop data on the cost of services sold, though only about one-third of those firms report any clear corresponding improvement in performance (p. iv, LFiT).  The data shows that merely gathering data does not necessarily translate into improved performance.  Instead, as Altman Weil notes: “Real achievements can and must be made in using cost data and project management techniques to improve matter profitability.” (p. iv, LFiT) [emphasis added]. 

One project management technique that could improve matter profitability is to use collected profitability data in conjunction with the firm’s LPM efforts.  For example, only 55% of law firms that collect profitability data currently use that data to manage their practice groups (p. v, LFiT).  If profitability data is readily available, the natural next step is to use that data to actively manage practice groups in conjunction with LPM efforts.    

(4) To increase new business, law firms must differentiate themselves

Anyone with a marketing background can attest to the importance of differentiation in the marketplace when selling goods and services.  Differentiation is what allows one law firm to stand out from another. But nearly half of law firm leaders cannot point to a single compelling differentiator that significantly elevates their firm above others (p. iii, LFiT).  

Using the old standby “our lawyers are better than theirs” doesn’t cut it anymore.  True differentiation allows one law firm to contrast its services with competing services and emphasize the unique aspects that make its services superior. As Altman Weil writes: “Establishing a credible means of differentiation should be a key area of attention for all firms and each group within a firm” (p. iii, LFiT).  Using the LPM tactic of client communication (e.g., conducting “lessons learned” reviews with clients) may be a good place to start if a law firm wants to identify the ways in which it separates itself from other firms.

(5) Be realistic about how clients perceive the quality of your firm’s services

When it comes to the delivery of client service, perception often does not match reality.  Firms tend to overestimate the quality of their services.

53% of law firm leaders say that their firms are significantly ahead of the competition in terms of delivering client service (p. iii, LFiT).  In summarizing this data, Altman Weil notes: “It is mathematically impossible and logically inconsistent for most firms to lead the pack on these or any other factors.  If everyone’s ahead, there’s no pack to lead” (p. iii, LFiT).

Of course, overestimating the quality of client service likely means that many firms do not take appropriate action to improve the delivery of client service when, in fact, they should.  The tendency for law firm leaders to inaccurately assess client service is highly significant because unsatisfactory client service has consistently been one of the top reasons that clients shift a large portfolio of work ($50,000 or more) from one law firm to another (p. 50, CLO).

*****

In Part 2, we will examine the tactics that law firms use to become more efficient and why the LPM change process has been so slow at some firms.

December 04, 2019

Case study: Building a successful LPM initiative with online tools (Part 2 of 2)

By Tim Batdorf and Jim Hassett

This post concludes our interview with Steve Flaks, the Director of Pricing & Project Management, and Sarah Alford, Manager of Pricing and Project Management at Saul Ewing Arnstein & Lehr.

Q:  In Part 1 of this interview, you mentioned a pilot test program coaching six lawyers in LPM.  Did that initial success help lead to the decision to purchase a license to make our LPM tools available to every lawyer in your firm?

A:  Yes.  We had seen how the tools and templates could be used to speed the implementation of LPM, and we wanted to have them available for all 400 of our lawyers.  Our IT department created an LPM page on our intranet that is very slick and intuitive to use.  Lawyers can see all the different tools and easily identify the ones they need and download them, anytime anywhere.

I don't want to lie to myself and assume that lawyers are spontaneously going to go there all the time.  But it makes it very easy for us to provide each lawyer with the exact tool they need, whether it’s for defining scope, planning a budget, improving client communication, or increasing efficiency some other way.  This LPM home page, backed by over 150 templates, also gives us more presence and credibility within the firm. 

Q:  And recently you both decided to go one step further by enrolling in our Master Certified LPM Coach™ Program.

A:  That’s right.  We wanted to maximize the effects of our own coaching.   One of the challenges in coaching lawyers is quickly being able to identify and access the right documents at the right time.  We both have a high level of understanding of the enormous amount of information that's out there, but we need to get more intimately familiar with the details so that we can access it on demand.

We began by studying your LPM Coaching Guide which is only available to people who enroll in the certification program and to LegalBizDev employees.  In accordance with this program, we’ve been conducting role plays of typical LPM coaching sessions and are now applying our learning by coaching lawyers at our firm.  An LPM expert from LegalBizDev listens to our coaching sessions and then later provides feedback to help us fine-tune our LPM coaching approach.

Q:  I know that you are both in the middle of that certification program, but have you seen any successes yet?

A:  Yes, we have.  The attorney that I (Steve) have been coaching has bought into the concepts, and he has invited us to his Public Finance practice group meeting to discuss LPM. A lot of their work is fixed fee, and now we're starting to formulate how to use task codes to plan and track their budgets.  This will make it easier for everyone to be aware of the run rates and how we are tracking against the budget, so each lawyer on the team can see how they’re doing against the plan. In the future, we expect that much more budget information will be shared with the client so they, too, can track progress.

In addition, when we complete the program, it will be helpful to have the certification behind our names.  It helps the entire effort have more credibility, and it contributes to LPM being woven into the fabric of the firm.

Q:  What else are you doing to make attorneys more aware of your efforts?

A:  Probably the most effective communication was a roadshow we conducted last year in which we went to each of our offices in a kind of educational tour focused on “what is LPM?” and “what does it mean to you?”  We put together a PowerPoint deck that included screenshots of our web page, including some of our favorite checklists.  Then we logged into a live connection and navigated around. 

It was so well received that we are now considering a follow-up roadshow with fresh content.  But before we do, we need to improve the way we document and communicate our own LPM wins.  We’ve also been talking about maybe sending out a quarterly LPM wins report.  

Q:  Have you thought of any other ways to keep LPM and your role top of mind on a regular basis?

A:  I really like the idea of “LPM tips of the month,” because it's an excuse to send out a message and stay in touch and remind them of LPM.  Of course, we started with the 12 tips that are included with the LegalBizDev license, each of which illustrates how a particular template could be useful.  When necessary, we customize them to fit our audience and add new ones.

Q:  To date, do you think LPM has helped your firm develop new business?

A:  Absolutely.  The most obvious impact on new business is when LPM increases client satisfaction.  This in turn increases the probability of new business.  For both existing clients and new ones, we also work closely with the marketing business development teams on RFP responses.   We are seeing a lot more mention of LPM -- project management, budgeting, monitoring, all that kind of stuff -- as requirements in RFPs.  So, in many of our responses, we are talking more and more comprehensively about our LPM team, who we are, what we do, and how we can help.  It is no secret that many law firm RFP responses just give lip service to LPM.  But we are actually doing it, and we have the examples and the infrastructure to back it up.

Q:  Finally, do you have any advice for firms that are just beginning to implement LPM?

A:  Set realistic expectations and get the buy-in of senior management.  Start by finding just a handful of attorneys that you can use as your cheerleaders, attorneys that you think are in the right practice areas and have the right sort of influence within the firm. 

But don’t expect huge results in a very short period of time.  Be patient, and don’t try to do too much too soon.  And when you get good results, don’t be shy about shouting them from the rooftops.

November 20, 2019

Case study: Building a successful LPM initiative with online tools (Part 1 of 2)

By Tim Batdorf and Jim Hassett

Saul Ewing Arnstein & Lehr is a full-service firm with about 400 lawyers in Philadelphia, Chicago and 14 other offices.  The firm offers clients the national reach and sophisticated experience of a large firm with the local connections and value of a boutique firm. This post is based on recent discussions with Steve Flaks, the Director of Pricing & Project Management, and Sarah Alford, Manager of Pricing and Project Management. 

Q: Why did Saul Ewing Arnstein & Lehr initially decide to implement LPM?

A: As explained on our web page, “Value has never been more important to sophisticated legal organizations. We use LPM to achieve greater cost certainty and unwavering client service.”

Our initiative has developed gradually over the last several years, based on high level buy-in by senior management.  Even before Saul Ewing merged with Arnstein & Lehr in September 2017, Saul Ewing’s CFO, Paul Levy, began researching LPM vendors.  Paul’s interest was strongly supported by both our managing partner, Barry Levin, and our COO, Jennifer Peterson.  These days, LPM has become one of the key client service initiatives named in our strategic plan, and it has become more and more a part of the firm’s DNA.

Q:  Could you give me the 50,000-foot view of your key LPM initiatives to date?

A:  In 2016, I (Steve) was brought in initially with multiple roles, including billing, collections, and LPM.  It soon became clear that LPM needed more resources.  So, I focused almost exclusively on LPM and pricing.  A couple of years later, we added a second person to the team. 

We have made a lot of strides. We started with a pilot test program in which LegalBizDev coached six of our lawyers.  This produced significant results and generated enthusiasm for LPM.  We then subscribed to the digital online version of your LPM Quick Reference Guide and began using those templates in our own internal coaching. We held a roadshow in which we visited each of our offices to explain the basics, then increased our visibility by sending out LPM tips of the month and more.  Most recently, of course, both Sarah and I have enrolled in your Master Certified LPM Coach™ Program to learn more about how to adapt your proprietary coaching process to the unique needs of Saul Ewing Arnstein & Lehr.

Q:  What benefits have you seen from this?

A:  Quite a few.  We have rolled out various matter management tools used to monitor the progress of matters across a wide spectrum of practice areas and at different levels of granularity (e.g., matter or task-code level).  These tools keep the teams informed on spending, so that if budget issues arise, they can be proactively dealt with and communicated both internally and to the client. 

An example of a specific practice area where we have made significant progress is working with the M&A team on data mining and task code management.  We have created a large catalogue of historical M&A matters that we can refer to when preparing fee estimates for future proposals.  Using task codes, we can look at the number of hours and the fees for transactions with specific characteristics (transaction size, buy vs sell side, etc.) and also relative levels of effort for various phases of transactions.  This has provided M&A attorneys with more information and ultimately more accurate fee estimates.  We have done this type of analysis for other practice areas as well, and we continue to add this capability to more practice areas all the time.

Q:  It sounds like the M&A team has made a significant commitment to LPM.  What other examples of LPM benefits do you have?

A:  We have quite a few.  For example, we have worked closely with a Litigation attorney and his team to prepare and monitor a $2 million litigation budget.  We met on several occasions with all team members during the planning phase to refine the budget and monthly forecasting process.  All timekeepers are familiar with their roles and responsibilities and their share of the budget for all Phases and Tasks.  We have set up budget monitoring alerts that go to all team members as milestones are reached, so everyone is aware of our progress against budget.  We are also providing the client with monthly budget status reports and fee projections.  This exercise has provided the tools to more effectively manage the team and set expectations with a demanding client.

Another example was when a client asked one of our Real Estate lawyers to provide a budget estimate on a land purchase transaction.  The lawyer created a high-level guesstimate and called me (Steve) for a reaction.  While we were on the phone, I sent him a Real Estate Budget Template from our online LPM library, showing all the typical tasks and activities involved in real estate transactions.  We then spent about 30 minutes going through the exercise of identifying the team and assigning rates and hours for each activity.  Going through this exercise was a real eye-opening experience for the attorney, and it allowed him to present his proposal to the client with far more confidence (less stress) and more transparency, because he could support the budget estimate with detailed, documented assumptions.  It showed the client that he had put a lot of thought into the proposal and therefore increased his credibility.  While the attorney had not typically used this approach in the past, I believe he will do so more often in the future, having seen the benefits.

Q:  Let’s back up and briefly discuss each of the initiatives you listed at the start, starting with the pilot test of coaching.

A:  We identified six volunteers from several practice groups for coaching, based on their need for LPM, their open-mindedness to trying new approaches, and their influence within the firm.  We started with a brief kickoff session to introduce everybody to LPM and give them a roadmap of how the program would work.  Each one then held about eight phone calls with a LegalBizDev coach over the next few months to improve client satisfaction with current clients.

For example, one participant was the relationship partner and team leader for a multimillion-dollar matter that included over a dozen lawyers.  Over the course of several months of coaching, she instituted a number of changes, including the development of a comprehensive task checklist based on handling hundreds of eminent domain suits, and a “lessons learned” meeting with the client in which we discussed simple ways to increase efficiency, such as assuring that each condemnation document was titled with property owners’ names.

But the biggest effect of this pilot test was to provide a “proof of concept,” showing that LPM could indeed make an important difference in efficiency and client satisfaction.  This began to build momentum within the firm.  Since these key attorneys had directly experienced immediate benefits, they became credible internal champions who spread the word.

Additional examples will appear in Part 2 of this post.

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