This is the third in a series of posts titled Metrics that Matter. Our previous post looked at the power of marketing and intakes metrics. It is Litify’s goal to inspire you to think about which questions are the right ones to ask and challenge you to find the answers. Metrics are often the best tool to help you reach these answers. In this post, we’ll examine matter metrics.
The Future is Now: Projected Inventory With Projected Close Date
The question that looms over all marketing and intake data is: What does it translate to in dollars and cents? How can you decide where to reinvest and understand the health of your business if you need to wait two years to see the results?
Begin by holding your attorneys accountable for projecting their “pipeline”. Assign an estimated value to every matter and project the month that you expect them to close. While this data is inevitably imperfect, it allows you to begin forecasting your revenue with a degree of confidence. You can begin to see if your marketing efforts are working and whether specific channels are driving better quality than others. Hold your attorneys accountable for their projections and begin to see into the future of your business.
Squeezing Oranges: Estimated vs Actual
Once you begin predicting the future, you can then turn an eye towards the past. By comparing what you have actually earned on cases to what you thought you would earn, you can learn valuable lessons about the way you used to do business, the way you currently do business, and allow you to chart a new course for the future.
There may be marketing channels that did not pan out, attorneys that underperformed, or practice areas that were not viable. Dig into the data, zone in on the areas of concern and optimize. Looking back over your historical data overlaid with what you thought the future held at that time provides you with the crystal ball you need to keep advancing your firm into the future.
Performance Review Time: Average fee and length of time by attorney
Asking questions about your business is important, but it is significantly more important to understand the performance of your attorneys.
Automate the reporting and be transparent with your team by allowing your attorneys to see how they compare to their colleagues. Display which attorneys are maximizing the case value, who is moving through their file most efficiently, and celebrate them as winners in your firm.
“Our business has many different facets to it. We attempt to distill it down to several key metrics that allow us to confirm that we are moving the ball forward. We do this by watching the milestone moments of a case.
By tracking at a very high level that we are hitting specific milestones across the firm, we can quickly see if the firm is trending in the right direction. If our attorneys are opening new cases, sending out demand letters, signing releases, and closing cases at a better pace than last month it is typically a telling sign that our business is healthy and growing.
We use many metrics to measure the success of our business, but these metrics that confirm the machine is both pumping and picking up speed are the key indicators that we are on the right track.”