Five key law practice technologies can reduce the time you spend on nonbillable management chores and lower your risk of malpractice and disciplinary trouble. Find out what they are and how to decide which are right for your firm.
Newer accounting programs have new features that make the business side of law easier, particularly for solos and small firms. Want to email bills and let clients pay with credit cards online or integrate your bank with the accounting program to pay bills online? These and other novel, but increasingly essential, features make it necessary to prioritize your “needs” and “wants” before you shop around.
Efficiently collecting money for the services you render is crucial to keeping your law practice afloat, except for pro-bono funded legal service clinics. Top-notch billing and accounting software not only helps you stay organized but also ensures a steady cash flow, helps you analyze profitable matters, keeps vendors paid, and prevents your CPA from cringing when reviewing your books.
Managing the overall financial picture of a firm involves several factors, and time and billing is just one piece of that puzzle. Many software applications on the market are designed specifically to manage your time and billing, but not your overall ledger. They handle your Accounts Receivable, but what about the rest of your accounting? If you choose a program that only manages time and billing, it’s crucial to ensure it integrates with your other accounting systems.
The main goal of incorporating technology into your practice is to reduce the time lawyers and staff spend on services. However, if you bill only for time spent, saving time means earning less. This makes it hard to recoup technology investments when hourly billing is the norm. This situation is known as the productivity paradox. To stay profitable, lawyers must address this issue. Hourly billing is essentially cost-based billing: you estimate the cost of services, add a profit margin, bill by the hour, and hope for the best.
