In my previous post, I suggested that big data for law firms isn’t new, but consumer-level access to it is new. That’s because there were no useful tools available to the general public for big data, either to access or analyze it.
The simplest example of big data that was neither easy to access nor easy to analyze was the credit card statement. We have all received paper credit card statements, listing each transaction. Plotting all of those transactions over the course of year required time, effort and notebooks of graph paper. Tracking spending habits over a five year period was reserved for the most meticulous people.
However, corporations like Walmart, and government agencies, had the resources to build their own tools and convert all of that paper tracking into digital format. Even in 1991, it was still easier to dial into a program like Retail Link to track a product than sift through notebooks of graph paper. As Walmart demonstrated, easy access to big data is key in finding ways to cut costs and become more efficient while remaining attentive to customer needs.
Just as technology has advanced to the point where Walmart suppliers need to hire specialists to help analyze data spewed out by Retail Link, technology has also advanced to the point where lawyers can now access big data produced by their firms. This is key for the “new normal” and the continued proclamation of the demise of the billable hour.
The billable hour remains an easy way to track what you’ve done in a day, like how much time you’ve spent doing client intake, drafting motions or returning phone calls. Manual tracking required looking at the clock, marking down the start time, doing the work and looking at the clock again to see what time you stopped. This is tedious, manual labor.
Thanks to technology, the Internet and the growth of cloud-based practice management systems like Clio, much of the manual time tracking is automated. There is no need to write down time on a scrap of paper and transfer it to a spreadsheet, or keep it in a spreadsheet to send off to the office manager for billing. With the click of button, you can start recording your time, wherever you are.
Not only can you record your time, you can then run reports to see just how well your firm is performing. This real-time reporting means you can make corrections, and then see the results instead of waiting a month, making correction and waiting another month to see if there’s improvement. Reporting tools from cloud-based practice management software like Clio, coupled with using an Individual Control Chart to establish a baseline measurement, means small law firms can become adept at using big data to streamline operations and strengthen the bottom line.
In effect, small law firms have the tools at their disposal to function like Walmart.
So at the end of the day, you automatically have an accurate record of what you, and your firm, have accomplished. This tracking can accumulate to encompass years worth of data. From that vantage, you can look at your billables for you, or across your firm, and set your rates accordingly. You can determine how long certain types of cases take, or how long certain parts of a case last. You can view who has been productive and have a very good sense of how your firm is performing.
Utilizing such data means small firm lawyers can gradually move away from the billable hour without the worry of wondering if they are not charging enough. Analyzing the big data produced by your firm will tell you, just as it tells Walmart, what works and what needs attention. Such information allows for more flexibility and control over your time, something that is increasingly referenced as part of the “new normal.”
Big data is not something to be feared, but embraced and managed. It will make the practice of law efficient, and in the process, enhance your life.