Following on from my post last week that the ‘Billable hour remains the pricing method of choice for Australian law firms’, Altman Weil’s ‘2017 Chief Legal Officer Survey’, published later in the week – and now in its eighteenth year – throws a different light on this debate.
The big take-out for me can be found on page vi of the Executive Summary – namely that in-house lawyers now see ‘cost certainty‘ as being more important to them than ‘process efficiency‘.
Specifically, page vi states:
“Costs over process”.
Think about that for a second – because it’s massive if you happen to be in private practice.
Crucially, though, is this comment (also on page vi of the Executive Summary):-
It is easier for law departments to demand cost reductions from providers and let them determine how to achieve lower fees.
So what do we have here?:-
- cost certainty over process efficiency, and
- private practice being allowed to determine how to achieve lower fees.
QED: If you’re in private practice and don’t have, (a) a robust Legal Project Management system/program, plus (b) data and analysis on the profitability of fixed fees that you can/should be offering…
… then your firm is likely in a lot of trouble.