What Metrics Should Law Firms Track to Make More Money?
When business is booming, it can often feel like a waste of time to track performance metrics. However, taking the time to measure what you are doing right is as important as figuring out what you are doing wrong.
The 80/20 rule may seem random, but there is certainly some validity in identifying what actually makes you, or your firm, money. Despite the fact that tracking time is generally part and parcel of the job, it can often be rather difficult to identify the right metrics to track to increase profits. Below you can read about two types of metrics you can track to make more money.
When it comes to making money as a lawyer, it is really difficult to do so without clients. To that end, one of the most important things every law firm should track is the client intake pipeline. Some of the most important metrics to follow include your various conversion rates, such as for web visitors to callers, and for callers and referrals to clients.
Not only do you want to track where your client leads come from (in order to place more of a focus on the best performing lead generators), but you may also want to track who handles the intake process and how it was handled (if possible). The goal is to find out what you're doing right and wrong, and to continually be improving.
In this day and age, with technology connecting everything nearly seamlessly, there's very little excuse for law firms not to track Key Performance Indicators. Law firms can easily fall into the trap of equating busyness to success, and this is especially dangerous for firms that take mainly contingency matters.
When it comes to individual attorney metrics, some of the main indicators include productivity, profitability, and business development/client management. Simply by tracking these metrics, and making it known that these metrics are being tracked, a firm can see an overall increase in attorney performance. Additionally, individual attorney metrics can be tied to bonuses and other incentives that can further drive attorney productivity.
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