Law firms are no strangers to the exact nature between hours billed and services rendered. Every minute, every detail, and every client interaction add up, and it’s important that both sides match in order to maximise profit and offer transparency and value for clients.
Profits are the lifeblood of any law firm, and profit leaks can seriously undermine the financial health of any firm. Let’s shine a light on the significant sources of potential loss within your law firm’s economic framework – missing time entries, inaccurate timekeeping, and the worry of fee discounts.
Missing time entries
Picture this: a day packed with client meetings, court sessions, and case research. Amidst the bustle, it’s all too easy for billable minutes to slip through the cracks. For law firms, missing time entries can be a silent yet substantial profit drain with 37% of legal professionals we surveyed stating missing time entries was their biggest form of profit leak.
Even an hour a day, unbilled at an average rate of £180 (for a UK solicitor of 4-8 years’ experience outside of London), equates to a weekly loss of £900, or an astounding £46,800 per year; consider the potential revenue if this hour was billed at an average rate. The cost of inconsistency becomes painfully clear.
With that in mind, strugglers for time management and time recording should strongly consider streamlining their time-tracking methodology. Move away from manual entry systems, which are prone to error and delays, in favour of digital solutions that capture billable hours seamlessly. Implement automated systems and regular time capture check-ins throughout the day. This may seem like micro-management but think of it as damage control. By making it a habit, you minimise the risk of lost billable hours.
Another proactive step is to encourage time recording ‘as they happen.’ The post-event catchups can be time consuming and are often less accurate than after the fact entries. Train your team on the value of immediacy when it comes to recording billable activities.
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