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WHY is business intelligence important for legal firms - why should you care?
By Stephen Butler, CEO, Red Rain
Gone are the days where being a successful and profitable law firm simply meant hanging a shingle above your front door and waiting for work to walk right in… The legal profession in Australia is more competitive than it has ever been. If ever there was a time to get a handle on how effectively your business is operating, it is now.
Flying blind
As the age-old adage goes; “if you can’t measure it you can’t manage it”. In the absence of reliable data, firms are flying blind and effectively making decisions on a whim. The most successful businesses - law firms or otherwise - have sophisticated Business Intelligence (BI) tools for measuring and analysing performance.
So, the question for your business is: what data is driving your decisions and performance?
The issue is that legal professionals are singularly focused on their primary task, which is interpreting and actioning law. While it is imperative to run a profitable and efficient business, present most lawyers with a page full of figures and their eyes are likely to glaze over. Therefore, presenting information in a clear, visual manner makes it digestible and fundamentally easier to action.
The problem for most firms is that they rely upon reports from their accounting systems for business information.
The issues are that reading and understanding a report is not straightforward and you need multiple reports to get all the information you need. Worse than that the report is out of date the instant it is created.
Systems that will assist you making effective decisions must be able to action, process and provide data that is current. They must be easy to access and easy to understand.
This is another important point – the vast majority of organisations already have the data they NEED to help make better business decisions – it is just a matter of harnessing that data in a way that makes it accessible in order to make it work for the firm. Mining existing data doesn’t have to be particularly complex – it is really a matter of putting financial figures into a system that is designed to help people visualise – and turn an existing asset into something more tangible and ultimately useful to the business.
RedView Acuity – Business Intelligence for legal firms
Improving efficiencies
Businesses that can properly leverage BI will have better control over their processes, profitability and cashflow. They will have stronger visibility into what’s going on within their organisations and can standardise procedures that eliminate inefficiencies and improve effectiveness.
Having figures presented in a clear, concise and easily digestible manner also leads to efficiencies down the line. Rather than ‘flying blind’ or devoting countless hours to collating and interpreting figures, a BI solution captures relevant information according to pre-set parameters, and effectively automates specific financial processes.
This frees up time for legal professionals to focus on other tasks – as well as effectively saving the firm staffing costs associated with creating reports.
On top of that, giving lawyers information about their personal performance, in a manner that they can easily understand, means that they become aware and learn about the financial aspects of their practice. This improves responsibility and accountability.
Do what your competitors aren’t
Being intelligent is hard work but having great BI is doesn’t have to be. It takes time, effort and focus but with the assistance of some advanced applications it is within reach and a budget, even for smaller firms. Effort in the short term saves time, provides deep insights into the business and, ultimately, helps the business make money – resulting in a win-win situation for the firm and its employees. A competitive advantage can be critical in today’s ultra-connected world. Business Intelligence can provide that advantage, and literally be the difference between being a leader and being part of the pack.
