Beyond being a good lawyer, running a small law firm requires overseeing numerous activities on the business management side. This means that you may be heavily involved in billing and expenses, trust accounting, handling tasks and deadlines, and keeping up with client communications. For most firms, these tasks can take up a considerable amount of time and resources, cutting into the number of hours available for billable work. Implementing a few key changes in the way your practice is run can make all the difference in freeing up more time for tasks which you can put on an invoice and lead to a more prosperous 2019.
Before you start putting these changes into place, one of the best things you can do is analyze how 2018 went for your firm in a business sense. Keep in mind that collecting careful financial data will help you get a broader picture of your firm’s financial health and make an informed business decision on how to improve while giving insight into how to answer critical questions like:
- Were there any inefficiencies that could be improved on?
- What practice areas are performing well and which practice areas have room for growth?
- Are we efficient with our resources and time?
To set yourself up for record revenue in 2019, there are seven very specific improvements that we will outline which can contribute to increased productivity and efficiency — boosting the numbers in your books next year.
Steps to Jumpstart 2019
#1 – Real-time time and expense tracking
Nothing is worse than doing work and not getting paid for it. If you delay entering time, it’s likely that there’s going to be items that don’t make it onto an invoice. The same goes for expenses and the failure to collect reimbursement costs. Enter all time and expenses as they occur to avoid not collecting all your hard earned income.
#2 – Stay ahead of collections
Collections are of one of the least favorite tasks involved in running a practice and can often be a cumbersome process. Utilize evergreen retainers, bulk invoicing/reminders, and automatic replenishment notices to automate as much of the responsibility as possible to ensure healthy cash flow.
#3 – Avoid isolated billing & accounting
When billing and accounting records are managed in two separate programs, you’re losing time entering in transactions to both systems and increasing the risk of error with duplicate entry. The most commonly used billing and accounting programs also lack the safeguards and tools needed to address legal-specific accounting requirements like trust accounting client ledger management, fee distribution and the allocation of revenue receipts.
#4 – Maintain trust accounting compliance
The biggest concern with trust accounting is maintaining compliance, which can seem daunting given the large number of rules and requirements governing law firms. Utilize an accounting program with trust accounting safeguards which prevent many common compliance violations, like account overdrafts and the commingling of client and firm funds.
Take it a step further by ensuring your accounting program can run all of the advanced reports you may need to prove compliance during a spot audit or annual review.
#5 – Get a 360° view of events, tasks, documents, and emails
Organization is the key to success for any business, but this can be a challenge for law firms trying to maintain compliance, collaboration, and convenience while keeping track of events, tasks, documents, and emails. Utilize a practice management system which can keep track of all of these daily items in a matter-centric recordkeeping system.
#6 – Avoid communications breakdowns with clients
Today’s clients are looking for constant communication, leaving law firms to figure out a way to keep them satisfied while ensuring security, privacy, and convenience. Share documents, arrange meetings and allow clients to view and pay invoices through a secure client portal. Secure and convenient, all of these details can be tied to any matter creating a trail of all client communications.
#7 – Eliminate complex IT headaches
Maintaining a firm’s IT needs can be a distraction from the actual work that needs to be completed for clients, especially when handling complex tasks like regular maintenance and system updates. Utilizing a cloud-based practice management system, such as CosmoLex, helps eliminate IT worries as all updates are automatic and all of your data is stored securely, encrypted in the cloud.
Get ahead in 2019
No matter how successful your firm was in 2018, there’s always room for improvement and larger goals in 2019. Many of the changes that will have the highest impact on your firm’s productivity and bottom line can be implemented through the use of a cloud-based practice management tool like CosmoLex. Make a resolution in the new year to take advantage of the power of technology to transform your practice and set your ambitions high for 2019.
Ready to kickstart your practice growth in 2019? Check out our on-demand webinar to get even more details on how to implement these 7 steps into your practice: Give Your Law Practice a Head Start for 2019.