Key Performance Indicators

Law firms of all sizes should calculate and track indicators of their performance and health. The most successful firms use these indicators to assist in making important business-like decisions, in motivating and aligning behavior, and in adjusting to the new realities. Indicators should meet the following three criteria to qualify as a KPI for your firm: 1. It must reflect the firm's strategy and goals; 2. It must be key to the firm's success; and 3. It must be quantifiable Your firm's strategic focus will impact its selection of KPI.

Law firms of all sizes should calculate and track indicators of their performance and health. The most successful firms use these indicators to assist in making important business-like decisions, in motivating and aligning behavior, and in adjusting to the new realities. Indicators should meet the following three criteria to qualify as a KPI for your firm: 1. It must reflect the firm's strategy and goals; 2. It must be key to the firm's success; and 3. It must be quantifiable Your firm's strategic focus will impact its selection of KPI. The author is not suggesting that all that counts in a law firm can be counted but rather what gets measured is what gets done. Therefore, if an indicator is not quantifiable, it is not likely that it will be incorporated into a firm's decision-making process which may in fact cause issues to go unaddressed. The list of KPIs identified in this booklet is not intended to be exhaustive but rather as collection of common and not so common KPIs that firms are and will be using over time. The KPIs identified in this guide are broken down into the following four categories: • Special Pandemic • Marketing • Productivity • Financial A word of caution – KPI is simply a tool – they are no substitute for the use of common sense and good judgment when it comes to the management of a law firm.

Stephen Mabey is a CPA, CA, and the Managing Director of Applied Strategies, Inc. He is a Fellow of the College of Law Practice Management; written over 100 articles on law firm management published in legal periodicals in the United States & Canada; Has spent more than 25 years in a senior management role with 200+ lawyer multi-office law firm; and spent over 11 years providing advice and counsel to small and mid-size law firms. Stephen has advised on a wide range of law firm issues, including - strategic planning, leadership, succession planning, business development, capitalization of partnerships, lawyer & staff engagement, marketing, key performance indicators, competitive intelligence, finance, mergers, practice transitioning, compensation, organizational structures, and partnership arrangements. Stephen's clients have said, "His advice and the solutions were tailored to our unique needs and business context," "It's as though he 'got us' right away and didn't waste our time (or our money) on the unnecessary stuff," "Stephen was invaluable in helping us steer through a difficult time of transition within our firm," "He has helped our firm immensely over the past number of years, and we are most appreciative of his contribution it's like have a CEO on retainer," "Steve possesses that rare ability to bluntly deliver tough and practical business advice while maintaining his personal warmth and good humor," "Stephen has been invaluable in assisting with and guiding us through our strategic planning process. His broad knowledge and experience, combined with his engaging and inclusive facilitation style, promotes thoughtful and productive discussion among our partners," and, "Steve always pushes the leading edge in terms of new ideas and new ways to carry on business."