One of the things we get asked all the time is: if I put the effort into process improvement, will it be worth my time? Basically, they’re saying, “show me the money.”

Asking a group of people who bill hundreds of dollars an hour to spend time on anything non-billable can be a challenge. So let’s break it down a little.

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If you normally bill $300/hour, and you spend 10 hours on an improvement, you’ve notionally invested $3,000. You’d want to know that you had a return of at least that amount, right? And many improvements are going to reduce the amount of time you spend on a particular legal task, so wouldn’t you be cannibalizing your billable hours and losing money in perpetuity? No!

First, you’re assuming you would otherwise have billed for every minute of that 10 hours. We all know that’s unlikely to be the case. In fact, most lawyers are only billing for about 2.5 hours of time a day.

Second, even when you’re doing billable work, you know very well not all of your time can be or should be billed to the client, so you’re likely writing off or writing down some of your time.

So Where Do You Start?

To overcome that “show me the money” argument, start with improvement efforts that target the non-billable work needed to run the practice, including things like business development. Or focus on reducing the time you (or others) typically write off because you know the client won’t—or shouldn’t—pay.

Time you’re no longer writing off or wasting on non-billable work is time you can dedicate to other important things like legal work, business development, or going home earlier—things that add value to your practice or your life. It’s a way to generate higher revenues without spending any more time in the office (or the home office).

Of course, all this assumes you are billing by the hour. If you bill ANY work by flat fee, then the ROI of process improvement is very easy to see. All the time you save translates directly into higher margins for your work.

It’s why we often recommend that lawyers who bill by the hour look for discrete tasks or elements of their practice where they can switch some of the work (even it’s a small piece of a larger matter) to higher-margin flat fee work.

Some Client Successes

With this in mind, I want to give you a few really simple examples of returns our clients have seen:

• A one hour mapping & redesign session eliminated a 90-day billing delay with a simple process change. It required no effort from the lawyer and minimal effort from her paralegal, and significantly reduced the time to collect receivables.
• On the first day of a 3-day process mapping & redesign project, a paralegal identified a 45-minute task that could be eliminated by developing one template. It took her less than an hour to develop the template, and a few minutes of lawyer time to approve it. With her investment of a few hours, she eliminated a 45-minute task for herself and a team of other paralegals forever, in a flat-fee process the firm conducted hundreds of times a year.
• One of our clients saved 15 minutes of lawyer time in a process the firm conducted at least 2,000 times a year, by installing a $300 printer/scanner at Reception and instructing the receptionist to copy IDs when purchasers arrived for real-estate closings. That’s at least 500 hours of time that the firm’s lawyers could put to better use! Not only did the firm increase its margins on this flat-fee work, but it could also reinvest the hours in higher-value revenue-generating activities.

Measure Measure Measure

Our clients could demonstrate their return in each of these examples because they’d taken the time first to measure their current state. They could see the difference in what they were spending before and after the improvement.

You can do the same. Ask yourself:

• How long does your process take you now?
• How many times do you do it?
• How many people are involved?
• How many steps are involved in the process?
• What’s the current margin?

Measure, measure, measure. And when you’re finished your improvement, measure again.

• Is your process faster?
• Can you do more in less time, or with fewer people?
• Have you eliminated a waste or frustration that was dragging you and the team down?

If you can answer yes to even one of these, then you are better off.