Technology: Future-proof your practice
For the past two decades, law firms have boosted partner profitability through increasing leverage. But this model is coming under greater pressure as demographic factors and changing attitudes threaten to stem the supply of young lawyers. Sally Gonzalez looks at whether technology can fill the gap
According to David Maister, a much-published authority on best practices in managing professional services organisations, profitability depends on five key factors: leverage, billing rate, utilisation, realisation and margin. The interplay of those factors in a specific law firm determines the net income per partner, which in turn drives profitability. As a result, business leaders in law firms spend a great deal of time thinking about how to influence those factors and strike the right balance leading to the highest profitability. Most focus on management strategies – only a few think about how technology might help.
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