The profitability index looks at a firm’s ability to convert revenue into profits. These scores are based on the ratio of profits per partner to revenue per lawyer. The profitability index seeks to demonstrate which firms most effectively balance leverage and overhead for the highest possible profits.
On this chart, the profitability index is derived by dividing profits per partner by revenue per lawyer. Leverage is the ratio of all lawyers (minus equity partners) to equity partners; profit margin is the ratio of net income to gross revenue multiplied by 100.
