Managing Legal
In about 60% of legal matters, the law firm doing the work fails to estimate the amount of money needed to complete the task, according to a recent BigHand technology survey described in The Artificial Lawyer June 28, 2022 issue.
This has two harmful implications:
1. Lax cost control: there is no number against which to manage accumulation of ongoing charges while lawyers run up the bill. “Cost control” is left to the attorneys.
2. Lax resource planning: where attorneys fail to establish an all-in cost number for their work, they are unlikely to discern wisely among aspects of the work that call for high-priced lawyer talent versus those better suited to business processes and automated systems that are cheaper, faster, and more accurate than lawyers.
The combination of the hourly billing business model, plus law firms’ failure to establish a budget, means that 60% of legal matters are not subject to meaningful cost control. For such matters, lawyers are literally “just running the fare meter”.