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Thomson Reuters
Law firm management

Don’t fear change: build a continuous improvement programme

Julia Szczepanski

09 Nov 2016

It’ll keep your clients retained and satisfied, and your firm financially healthy. It’ll help you reduce wasted time, costs, mistakes and risks. It’s called continuous improvement and in yesterday’s webinar we discussed the best practice steps you can follow in order to build a strong internal change culture at your firm.

Leaders at law firms often need to be convinced that they must address continuous improvement at all. So why should you implement a continuous improvement programme? The most straightforward answer is because it’s already a regulatory requirement: all practices authorised by the SRA under the Legal Services Act 2007, including ABS, must appoint a compliance officer for legal practice (COLP) and compliance officer for finance and administration (COFA). Their responsibilities include ensuring systems are in place for compliance, such as a system for monitoring, reviewing and managing risks on an ongoing basis.

Risk and compliance align with continuous improvement. Compliance officers must analyse, identify and review risks, and recommend and implement change to address them, because the risk environment changes rapidly and constantly. The regulatory framework has to keep pace to protect clients and firms alike, against threats such as inappropriate use of client monies, becoming unwitting targets of money launderers, lack of adequate firm succession planning, poor service outcomes, cyber crime and failures of information security, inability to measure or control financial performance and weak processes for collecting bills.

Requirements refuse to stand still, and so do your clients’ needs: in order to meet both, your efforts at continuous improvement must come from the top down, and from the bottom up

These issues can all be triggered by inadequate internal systems, controls and processes as firms battle to adapt to rapid market changes (such as increased complexities of the law, client demands, financial challenges, and technological advancements).  A firm-wide language to embrace change should go hand in hand with a firm’s risk and compliance activities. Requirements refuse to stand still, and so do your clients’ needs: in order to meet both, your efforts at continuous improvement must come from the top down, and from the bottom up.

Putting your obligations to one side, what are the benefits of establishing and maintaining a continuous improvement programme? Change within your law firm can be stressful, so it’s important to spell out the upsides to uncertain colleagues. And they are considerable. Continuous improvement can increase internal agility, engagement and empowerment at your firm, making sure decisions land with the right stakeholders and are made at the right level. In turn, this makes the mix of staff supporting legal matters more profitable, as their workloads and decisions better match their capabilities. This all helps to increase the most important metric of all – client satisfaction.

However, establishing a continuous improvement programme can seem daunting. How do you identify the quick wins that will have an immediate impact, and help you secure wider buy-in? The first thing to do is to identify those areas of the practice with the biggest negative impacts on its ability to be a profitable, fit-for-purpose business, and undertake an audit of staff views on how to put things right. A quantifiable metric is crucial to measure success, such as reducing staff attrition, or increasing client retention, by a given percentage. Continuous service improvements should be targeted at the four Rs: revenue, relationships, reputation and rewards.

Finally, although continuous improvement is present in most firms thanks to the SRA rules, it’s important that law firm leaders talk about improvement in a way that’s accessible to everyone at their firm, rather than a vague programme that they might not recognise. It’s important to make your continuous improvement ‘a thing’ – give it a name, like ‘XYZ LLP’s Improve and Innovate Programme’ – so that employees can talk about and relate to it.

For more help and guidance on implementing a continuous improvement programme in your firm, click here to view a recording of the session, and to contact us for more information.

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