Practice Management Software: Simplifying Your Practice
You’ve decided to open up your own law firm. Congratulations! Now, what do you need? Office space, some paper for the printer, files for each of your cases, and… oh, right. You have a boatload of cases and the documents for each are spilling out of their overworked manila folders.
The good news is you’re not stuck with the pile of folders. There’s a better way to organize your caseload and streamline billing for each client, as well as accounting and reporting for your firm. It’s called practice management software, and it does exactly what the name says – helps you manage your practice, leaving you more time to focus on those cases.
There are many options out there, but in general most practice management software ensures that all information for every matter in your caseload is kept in one place. It doesn’t matter what task you’re working on or whether it’s billable or not– it all goes to the same spot. From scheduling calls and meetings with clients to bookmarking deadline dates, you’re covered.
Let’s look at a common scenario. You have a client who calls a few times a week with questions that take 15 minutes of your time. Your secretary screens the calls and puts them through. You’re spending a couple of hours a day working on their case. Even though the trial is months away, you send monthly invoices on the money you have spent thus far from their client trust account.
If you rely on a paper trail system or different single-user electronic methods, your secretary is tracking the hours billed in phone calls. Somewhere else you’re jotting down the daily hours, and so is your paralegal or associate. In our sample week, you work 7 hours on the case, and your paralegal works 2 hours. Your associate fields four 15-minute calls for a total of 1 hour. That’s 10 billable hours. If your rate is $300 per hour, your associate is $200 per hour, and your paralegal is $100 per hour, the total billed is $2500.
If you’re turning it all over to a third person to organize the data and provide the monthly invoice – and you’re probably paying that person a pretty penny, that eats into your profits. If you’re trying to handle it yourself, then you’re spending valuable hours on non-billable administrative work. What’s a savvy attorney to do?
Practice management software is an all-in-one solution. Many choices of software offer the ability for multiple users to be logged on at once. You, your secretary, your paralegal, your associate, and any partners can all be working efficiently and tracking tasks in one central place at the same time. In addition, you can bill for your work automatically as time and tasks are entered, and the software will generate a complete monthly invoice for your client. By using the software, you’re preserving as much of your profit as possible, since the monthly fee is much lower than the lost hours you’d sink doing the tasks in-house. If the software is $100 per month, that’s around $25/week… or a mere 1% of your weekly profit from our one sample client.
Speaking of profits, many practice management software systems also sync with accounting software like QuickBooks or Xero. As you generate bills for your clients, you are also tracking profits and losses for your bookkeeper or accountant to review. You may even be able to hook up both of these to online bookkeeping software that links it all together, reducing overhead accounting costs even further.
This all sounds great to you. But you’re just starting out. So when do you decide to start using the software? The answer is probably right now. Given the cost savings over time, it makes sense to invest in practice management software from the beginning of your firm. A few years down the road when you’re looking for a particular case file or client invoice, you won’t be sorting through dusty folders in your storage room. You’ll have the information at your fingertips. Before that time comes, you’ll be all set for your first tax season. Ready to get started?