How to Improve Your Law Firm’s Profitability
All the good work your firm does seeking justice for your clients rests on the tireless work of your back office. Your team of paralegals and legal assistants work long hours and handle tough jobs to make sure you meet your filing deadlines, get your ducks in a row for trial, and win your cases. But this long, hard work is taxing on more than just your back-office superstars—it’s rough on your bottom line, too. And thinner profit margins mean you have less capital to devote to growth.
Leverage the right solutions and strategies, though, and you can kill two birds with one stone—and free your firm up to invest more profits into expanding your practice. Read on to learn how to improve law firm profitability by making the most of new technologies and services like eFiling.
Four Tips to Manage Your Law Firm Spend
Tough and time-consuming back-office work raises your law firm’s operational costs and slices your margins thinner and thinner. To manage your law firm spend and free up more profits for growth and development, you need to reduce your back office overhead without reducing the quality of the work your legal team does or squeezing them tighter.
Sounds like an impossible circle to square, doesn’t it? Don’t lose hope so quickly—there are ways to manage your spend and reduce your law firm’s overhead to improve profitability, employee satisfaction, and client satisfaction in one fell swoop:
Track and Analyze Your Costs
First off, when you want to get a handle on your household budget and put more money into savings, what do you do? You take a good look at what you’re spending money on and see where you can trim away the fat. You’re not the only business looking to analyze and cut costs, and recent years have seen a boom in cost management solutions in response to greater demand.
With modern data-driven analysis tools, managing your law firm spend the same way is easier than ever. By breaking down where your firm’s money is going into categories such as staffing, technology, or even office supplies, you can get a clear look at where you can make cuts without sacrificing the quality of your firm’s legal services.
Which brings us to our next tip for reducing your law firm’s operational costs:
Eliminate Unnecessary, Inefficient Work
Look for inefficiencies in your workflows and processes and cut them out. You’d be surprised by how much you can cut away without affecting the quality of the legal services you offer, thanks to today’s cutting-edge automation tools. Examples of work you can partially or totally take off your back office’s plate include:
- Manually entering billing information
- Data entry for case management
- Physical document filing
- Maintaining paper records when electronic versions suffice (depending on your jurisdiction)
- Manually scheduling appointments and managing email follow-ups
Implement Automation and Cloud-Based Tools
Technological solutions such as eFiling and case management software are essential for eliminating the back-office inefficiencies we’ve just discussed, especially remote and cloud-based solutions that don’t demand you maintain your own on-premises infrastructure. These solutions free your team up for more valuable work and make for fewer all-nighters at the office—and less hours of expensive overtime logged:
- eFiling services
- Case management software
- Cloud-based document management and collaboration tools
- CRM (Customer Relations Management) software
With automation tools like these, growing your firm doesn’t have to mean piling more work on your legal assistants’ plates or expanding your physical office! Over the past few years, these services, software, and cloud-based platforms have created a new paradigm of worker-friendly, cost-effective hybrid offices. Hybrid office arrangements empower your back office team to work together wherever they are. These arrangements also mean you can reduce your physical office space without shrinking your business—saving on rent and utilities to reduce your law firm’s overhead and boost profitability!
Invest in Employee Training
You’ve definitely heard the phrase, “you’ve got to spend money to make money” before. Here’s another example of something you can spend money on to save money for your firm in the long run. If you’re investing in new technologies and systems such as CMS, CRM, document management, and eFiling tools, it behooves you to invest in training for your legal staff as well.
A one-time investment in training pays dividends when it comes to improving your law firm’s profitability by teaching your back office team how to reduce errors, streamline workflows, improve efficiency, and get their important work done without being overworked.
Join the Future of Legal Services with MyFileRunner
When it comes to knowing how to improve your law firm’s profitability by reducing overhead and operational costs, there’s no one “silver bullet” that does it all for every law firm. Just as you wouldn’t treat your clients and their legal needs as interchangeable, there’s no one-size-fits-all path to maximizing your firm’s profitability.
MyFileRunner is here to help you find the right growth solution for your practice. For firms across California, Texas, and Illinois, we’re more than just eFiling service providers—we’re your full-service partner, helping you take back the time and money you spend on administrating and put it toward winning cases and growing your practice.