Interesting topic going on over at the Hildebrandt blog on whether it is time to develop new ideas for measuring performance at law firms. In Lisa Smith’s post “Time for New Metrics“, she lays out some interesting new categories that law firms should develop to show how they are managing their business:
- Firm Performance – what are the relevant measures of firm performance, including the profit margin idea above?
- Expense Management – how do we measure the impact of changes in staffing models, leveraging technology in delivering services, outsourcing?
- Practice Management – how do we compare the performance of practices who may have very different profit drivers and pricing models?
- Partner Performance – how do we move from a billable hours and originations driven approach to measuring partner performance?
- Client Development/Market Strength – how do measure success in strengthening client relationships?
- Balance Sheet/Risk – can we assess the strengths and weaknesses of a firm’s financial practices?
- Management and Leadership – can we measure the effectiveness of strategic, talent management and other initiatives?