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2 posts from February 2019

February 20, 2019

Lessons Learned Reviews: A Key to LPM Implementation (Part 1 of 3)

By Jim Hassett, Gary Richards, and Tim Batdorf

It is widely agreed that many clients are demanding greater value these days through the application of legal project management (LPM). There is, however, still controversy about the best way to apply LPM. When we interviewed managing partners and senior executives at 50 AmLaw 200 firms for the book Client Value and Law Firm Profitability, they ranked client communications as one of the most important elements of LPM. (The only factor that was considered more important was “defining scope.”)

One of the best ways to assure effective communication is to hold a meeting at the end of every significant matter to review what worked, what didn’t, and what could be done better the next time. In large matters, lawyers may also conduct these “lessons learned” reviews after completing each significant milestone or phase.

These discussions are a learning opportunity and a marketing opportunity. Such a discussion can enhance your relationship, help you learn more about what an existing client values most, and enable you to provide more value. If a large matter is at a pivotal point, a mid-course review and redirection could be the difference between success and failure. Could you possibly think of a better way to develop new business?

The lessons learned review could be long or short. You could hold a formal group meeting and send the questions in advance, or you could simply ask your client some of the questions below. If you think of this as marketing, it will be obvious that it is better to have the discussion in person, maybe even over lunch. The phone can be a good second choice, but email is a distant third. You want to get people to open up and speak freely, and that is unlikely to happen via email.

The length and formality of the process should depend on the size and significance of the matter, your relationship with the client, and on how much work they are likely to have for you in the future. This article lists a number of different questions you might ask. In many cases, the first two will be enough.

The Two Most Important Questions

Unless there is a major open issue requiring an immediate joint review, or a client requests a lengthy discussion, we recommend that you assume that clients have little time to spare. This may mean limiting the debrief to two simple questions:

  1. What did you like about the way we handled this matter?
  2. What could we do better?

The first question is a classic “easy to answer” opening. Ask this one first, because it will get people talking freely.

The second question is the one you really care about, since you are likely to learn far more from criticism than from praise. No matter how much clients like your work, they can always like it more. Also, in today’s highly competitive environment, it is in your interest to turn every client into a raving fan.

If the second question opens the door to a laundry list of complaints, do not get defensive. Do not argue, disagree or explain your position. In fact, at most lessons learned meetings you should say very little and listen more than 90 percent of the time. Keep probing for more information. These meetings are designed not to understand reality, but rather to understand the client’s perception of reality. Because when it comes to client satisfaction and new business, perception is everything.

When clients raise problems, you need to reassure them that things will be better in the future. In most cases, however, you should not get into the details at the initial discussion. You need time to think about the best way to solve the problem, and to assure client satisfaction. So be prepared to say something like, “That is an important issue. Let me talk to a few people about the best way of preventing that from happening again, and then I will get back to you.”

Of course, if you do promise to get back to your client with a solution, you must put a high priority on completing follow-up as soon as possible.

Reprinted with permission from “Of Counsel, The Legal Practice and Management Report,” December 2018.

February 06, 2019

Tracking and Controlling Cost (Part 2 of 2)

By Steve Barrett, Jim Hassett, and Tim Batdorf

 

If the firm does have timely information going into the system, the next step is to get it out.

Whatever accounting package your firm uses, it already has a number of built-in features to assist budget tracking. The exact details vary not just from one program to another, but also depend on the version your firm is running and any add-ons they may have purchased. Since features are also constantly being updated and enhanced by software vendors, the best way to find out exactly what your firm’s software can do is to talk to your finance staff.

There is no one best solution for tracking. The best answer for you will depend on client needs, the way you like to work, the features of the software your firm already owns, and how much time is required and available for assistance from finance personnel. (Depending on your software, your finance department may simply not have enough staff available to implement a solution which is technically possible but time-consuming to set up or administer.)

The need to talk to appropriate personnel is especially strong if you work at one of the many firms that has developed or is in the process of developing its own individual custom applications to track and report spending.

During your discussion, you may want to talk about how practical it is to set up features in advance such as:

  • Initial budgets for a matter, phases, tasks within phases, and/or work in progress (WIP) on individual tasks by each timekeeper
  • A set of specific tasks and phases (whether the standard UTBMS set or a custom developed set)
  • A standard set of prose descriptions to identify tasks, with uniform nomenclature (Typically, one enters a task name in the pre-designated “Task” user-defined field with a 60- or 80-character field text limit)
  • The ability to limit which timekeepers are allowed or not allowed to bill time to a particular matter

Then you should discuss the most practical way for you to review the data, such as:

  • Summary reports by matter—The finance department may be able to set up a simple report that can automatically be generated every week, every month, or at whatever reporting interval you specify
  • Summary reports by client—It may be practical to track and report on overall client charges (by percent, absolute amount, retainer, or credit limits) as well as the phase, task, or individual timekeeper reports
  • Excel spreadsheets—If you like to work in Excel, reports can often be delivered in this format at your request (e.g. simply showing three columns: the initial budget, actual spending to date, and remaining budget)
  • Alarms or flags can be set to warn you via computer-generated automatic e-mails if a matter is running beyond its budget for a period, any time a certain number of dollars have been spent, or whenever a matter has spent any pre-defined percentage of its budget. For example, you could request that emails be sent to you automatically when you reach 25%, 50%, 75%, 90%, and 100% of spending.

In addition to the features in standard accounting packages and the custom programs some firms have developed, there are a number of related software tools that firms use to track and analyze financial metrics. In the last few years, legal project management software has also started to emerge as a new category. 

In summary, there are so many options and variations in this area, and they are changing so rapidly, that if you want to know the most practical way to track budgets in your firm, you will need to talk to the appropriate staff.

Reproduced with permission from the Legal Project Management Quick Reference Guide, Fifth Edition (© LegalBizDev, 2019).