Reinvent business operations to thrive in the new normal of today’s legal marketplace.
Many legal departments today are focused on efficiency, an inevitable outcome in corporations that long ago embraced efficiency — sometimes labeled “total quality” or “continuous improvement” — elsewhere in their business operations and supply chain. Legal department leaders, as well as legal operations and procurement professionals, generally appreciate that efficiency means something vastly different than the overly simplistic “do more with less” or even “do more for less.”
These simplistic tropes suggest that efficiency is about extracting more productivity at no incremental cost. Rather, efficiency in a continuous improvement context means that the organization — as a team and as individuals — is focused on doing the right things, doing them the right way, the first time, every time. This, to us, is the perfect way to think about the powerful combination of process improvement and project management. Together, these disciplines and their corresponding sub-disciplines can be characterized as continuous improvement.
In business, it’s widely understood that working on optimizing processes and working on operational excellence are good things. After all, in a competitive market where consumers will eventually and inevitably drive down prices of even the most highly valued goods and services, business leaders are constantly seeking a cost advantage.
Slowly but surely, law firms are accepting that efficiency is the new order, and building a continuous improvement culture is, at the very least, a practical response to growing client demand. But each day, more and more law firm leaders are recognizing that continuous improvement is also good for the firm. In fact, as every other business segment has already learned, this approach is far more profitable than any model based on perpetual inefficiency.
It’s clear that law firms simply cannot do continuous improvement work without considering the impact on other areas of the business. This includes developing and employing new ways to incentivize and reward people for being efficient, and shifting lawyer compensation systems from valuing hours worked or billed to more sophisticated measures of productivity and profitability.
So how does one literally reinvent the business operations of a traditional law firm in order to thrive in the new normal of today’s legal marketplace? The approach we advocate is to develop a plan that address all facets of what we call the P+ Ecosystem. What’s in it? For starters, these “Ps:”
- Process Improvement: We do the right things, the right way, the first time, every time.
- Project Management: We manage expectations and minimize surprise internally and externally.
- Pricing and Profitability: We know the costs and market value of our services.
- People: Our lawyers and staff are fully aligned with our strategy.
- Performance Management: We drive and reward behaviors that lead to long-term health of the firm.
- Performance Metrics: We track and share KPIs to improve performance.
- Practice Management and Innovation: We’re proactive in re-engineering our work.
These Ps are interconnected and, eventually, law firm leaders working on one or two will naturally affect and therefore require work in the other areas.
All law firms, wherever they may fall on the continuous improvement continuum, will benefit from learning about the use of Lean and Six Sigma in a legal context and then working on their legal and business processes. Nearly every process can be improved to deliver greater value to both the firm and our clients.
Even more compelling are the many law firms using their continuous improvement successes as the cornerstone of their strategic plans and marketing efforts. That is because, when we do process improvement work, we not only improve the process on which we are working, we also deliver greater value, efficiency and predictability while increasing our quality and likelihood of successful outcomes.
If that is not enough, keep this in mind: This is all done without tradeoffs. Rather, it’s a win-win for both the client and the law firm. We have the case studies to prove it!
Want more? Now that you understand the imperative, register for the upcoming P3 pre-conference session, the White Belt Certification Course: Legal Lean Sigma and Project Management, taking place Monday, May 14, from 9 a.m. to 5 p.m. CT, or look for future certificate opportunities from Legal Lean Sigma.
Catherine Alman MacDonagh, JD, is the CEO and a founder of the Legal Lean Sigma Institute LLC. Catherine provides expert consulting support and certification courses, workshops, programs, retreats and presentations designed for legal and business professionals. She is a Fellow of the College of Law Practice Management and member of LMA’s Hall of Fame. She is a 2018 LMA Your Honor Award winner for the development of the Legal WorkOut®, a collaborative, accelerated approach to process improvement that she developed. Portions of this article have been excerpted from her book Lean Six Sigma for Law Firms ©2014 Ark Group. Catherine can be reached at Catherine@LegalLeanSigma.com and +1.857.272.5695.
Timothy B. Corcoran is principal of Corcoran Consulting Group, based in New York with a global client base. He’s a Trustee and Fellow of the College of Law Practice Management, and was 2014 president of the Legal Marketing Association. A former CEO, Tim guides law firm and law department leaders through the profitable disruption of outdated business models. A sought-after speaker and writer, he also authors Corcoran’s Business of Law blog. Portions of this chapter have been excerpted from earlier works. Tim can be reached at Tim@BringInTim.com and +1.609.557.7311.
This article is excerpted from a chapter that will be included in an upcoming publication by The College of Law Practice Management.