PSC Elective - The law firm as a business

Synopsis

Trainees will consider the challenges facing law firms and how to meet them through strategic planning and financial management. Using a model firm, trainees will examine the key drivers of profitability and the importance of managing cash flow.

Outcomes

As a result of attending the course, you will:

understand how law firms operate as commercial entities
appreciate the importance of strategic planning
understand financial data and key performance indicators and how your actions affect profit and cash flow
recognise the importance of managing WIP and debtors
develop your commercial awareness of the legal sector
contribute more effectively to the day-to-day operations of the firm

Content

Planning

Why do law firms go bust?
The challenges facing law firms
Planning tools

Law firm finances

How are law firms funded?
Reporting financial performance
Key performance indicators and benchmarking

How do law firms generate profits?

Gearing
How much to charge
Recovery
Margin

‘Cash is king’ – the importance of managing cash flow

Cash flow forecasting
Lock-up explored
Managing WIP and debtors

The human element

Motivation
Performance management
Leadership styles

Business development

Winning new business
Retention – the importance of delivering excellent service to clients