Boost Your Law Firm Profitability with the Right Practice Management Software…Not The Cheapest!

Practice management software for small and medium law firms can on the surface appear very similar in features, advantages, and benefits.

 Naturally, this can tend to make pricing an important factor for decision-makers in deciding a system to move to or retain.

 Unsurprisingly, price features particularly highly in the decision process in firms that are not financially healthy. 

 However, choosing to acquire, or retain, a PMS involves many considerations, with price actually being one of the least important.

 Changing is quite disruptive, and can significantly impact revenues during the changeover period, something not many small-medium law firms can deal with easily!

 Unfortunately, the decision to make a change is all too often made with insufficient research.

 As a result, practice management consultants like me have regularly observed firms, having made the important decision to change, shifting on to yet another system, or back to the original system, sometimes within as little as twelve months!

Disruption and extra expense are the last things most small-medium firms need, because they impact revenue and profitability, with a direct impact on cash flow and liquidity. Additional stress for owners and others…on steroids!

 Robservation…A major new factor to be considered is whether a PMS you are considering, or considering moving from, will soon offer highly beneficial tools to assist with dramatically improving your practice profitability.

 Leading suppliers know that these included benefits will be key differentiators going forward, because the kinds of existential challenges now facing all firms will require firms to be both mentally and financially ready to be able to make a good fist of things.

 Surviving is not the only game in town. Prospering is critical to your future survival, enjoyment, and practice value at succession time.

 What’s coming down the pipeline for you?

 Small-medium law firms in all markets are moving into a yet another period of rapid changes that together represent an existential threat to their viability.

Businesses providing practice management software are fully aware of what’s coming and know that they need to be ahead of the curve to minimise loss of subscribers to other suppliers.

Law firms are already faced with maintaining and increasing revenue, by adjusting to pivotal needs:

·      the pressing need to be significantly more effective in marketing their services, providing better onboarding experience, and payment terms options.

·      the standout need to understand and offer a wider range of pricing models.

·      the critical need for more effective utilisation of employees, with significantly better productivity. Many of the current generation of employees think very differently to previous generations about their employment expectations and obligations, and ineffective traditional approaches to ensuring reasonable productivity will not work.

Firms are also needing to get a good handle on how AI can help them directly, and where its successful implementation by their competitors will present additional, more impactful, challenges in getting enough work at reasonable profitability.

All the issues now, or soon to be, at hand will require firms to have improved management skills and better financial resources.

It is well known to experienced players serving the legal profession that the very big majority of small-medium firms do not make reasonable “true” profits and as a result are not financially healthy.

The published data is clear, and the anecdotal evidence from national taxation authorities of the scope of defaults is that the problem is not headed in the right direction.

Legal profession regulatory authorities are from as early as 2021 increasingly recognising law practices failing to comply with taxation obligations as professional misconduct, calling into question firms’ principals continuing suitability to hold practising certificates.

In many jurisdictions principals are required to self-report compliance failures no later than when applying for practising certificate renewal.

Are you financially prepared, and supported by a PMS that’s truly fit for purpose in the second quarter of the 21st century?

 Not just surviving for now, but operating a financially healthy practice that can provide you with a commercial salary and benefits as well as the critically important reasonable profits needed to underpin practice financial health and vigorous sustainability.

 Skilled, legal market specialist, management consulting capable of assisting you to make life-changing improvements in profitability isn’t ever cheap, and nor should it be.

Imagine if what you most need for focusing on pragmatic action steps for financial health came packaged within your PMS at demonstrably good value for money!

When looking for a PMS to support a new venture, or considering dumping what you have, my KMSProfitPower™ tip is to include in your comprehensive checklist a reminder that you must be ascertaining exactly what each system you look at offers in terms of pragmatic, actionable, guidance that ensures you are fully supported in pursuing commercially reasonable, essential, profitability.

There is massive sense in doing this before you have liquidity problems, and think you are forced into making cuts in expenses including PMS subscriptions you don’t recognise as providing real value.