Remember when companies would pretty much pay whatever law firms asked? Consider it the Golden Age of Law Firm Profits.
The typical thinking was: “Legal counsel is an absolute necessity, and law firms are the only ones who provide it. So, we should just pay what the firm asks – it’s certainly cheaper than exposing the company to legal risk.”
A recent article in The Economist reports, “Companies must hire costly lawyers to guide them through a maze created by other lawyers. They must also hire lawyers to defend themselves against attacks by other lawyers on a playing field built by lawyers. The cost – roughly $800 a year for every American – is passed on to consumers.”
Today, things are different. Oh, the legal system is still as complex as ever – but companies have tightened their belts. They’re calling on law firms less frequently and negotiating for lower fees when they do.
The hardest-hit firms are responding the only way they can – by reducing headcount. The Economist article reports that “America’s 250 biggest law firms shed more than 9,500 people, nearly 8% of the total, in 2009-10.”
In addition, a recent article on AmericanLawyer.com, titled “A Rebuilding Year,” states, “Much of The Am Law 100’s gains were built on cuts in head count—average head count was slashed by 2.7 percent, while the number of equity partners fell by 0.9 percent, and the number of nonequity partners dropped by 1.7 percent.” Cutting head count to restore profitability is not a sustainable strategy, unless it is paired with a robust process improvement strategy.
Whether your firm has already reduced headcount or is trying to protect its profitability in other ways, your mission is clear: work more efficiently to win more deals and earn a greater margin on each billing. And the best way to do so is to focus on business process management (BPM).
Strategic firms see BPM as a reliable way to improve the bottom line through increased efficiency and decreased overhead costs. At the same time, they recognize BPM as essential for ensuring and actively enforcing risk management and compliance.
Over the past eight years, we at Elegrity have seen the difference BPM can make for firms ranging from multi-million dollar regional organizations to multi-billion dollar global firms. During this time, our BPM experts have defined, architected, designed, and automated countless complex business processes for clients. In the process, we’ve developed a proven methodology for delivering organization-changing business process automation solutions.
I could tell you more – but perhaps the best introduction is for you to read our white paper, “Why Law Firms Can’t Survive Without Business Process Management.” In it, we take a look at the key challenges firms like yours are facing and explain why the old solutions no longer work. And we provide you with new BPM strategies you can apply immediately to protect law firm profits. Download the white paper now.