LPM Tip

Beyond the billable hour

There is  a significant push underway to get lawyers to bill more on a project basis (clients are demanding more certainty about how much a matter will cost and clients are recognizing that paying by the hour provides no incentive for lawyers to be efficient).

In reality, if you run your law practice like many attorneys, you still bill most of your time by the hour and this is unlikely to change any time soon.

While it is certainly possible to have a satisfying, efficient and well run practice when you charge for your time in tenths of an hour, there are also some occupational hazards associated with the time billing.

One big problem with hourly billing is that your time becomes completely monetized.  In other words, when you bill by the hour, every hour you spend on "non-billable" work may seem like lost income.

But taken to an extreme, focusing only on billable work can seriously hurt your practice. A well-run law firm needs to also focus attention on marketing, managing staff, professional development, technology and finance.

So make sure you budget a certain amount of time each week to take care of these other important parts of your practice, even when you are busy with billable work.  While you may feel like you are losing money in the short run, you will hurt yourself a lot more in the long run if you don't tend to your marketing pipeline or take care of other important management functions in your firm.

Tip courtesy of Stephen Seckler, president, Seckler Legal Consulting and Coaching.

Published February 9, 2012

--------------------------------------------------------------------------

To learn more about the Law Practice Management Section, which is complimentary for all MBA members, contact LPM Section Chair Thomas J. Barbar or Vice Chair Stephen Seckler.