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Benchmarking and KPIs

Robert Mowbray looks at ways in which lawyers can monitor and improve the financial performance of their businesses.

Busy lawyers do not want to spend hours trawling through financial reports which they may not really understand. They want helpful, succinct information which provides invaluable feedback on their financial performance and which will enable them to constantly improve their financial results. Most law firms produce too much information and would be well advised to look again at the quantity and quality of what is made available.

Law firms are simple businesses. They buy the time of lawyers through the payroll and then try to sell this time on to clients at a profit. Management information for individual lawyers should therefore focus on how that lawyer is doing at each stage of this process. The stages can be summarised as follows: