The law is, when you boil it down, all about people. It is about people interacting with other people and reaching a point when a professional has to come in and facilitate an interaction. At first glance, even running a law firm seems like more or less an exclusively human endeavor where people's needs dictate the game.

However, as many law firms have already found out, there is another facet to their existence, a more data-driven facet. They have discovered that data analysis and business intelligence in general can help them run more successful firms.

But, how exactly?

Business Intelligence 101

Business intelligence is usually defined as a combination of strategies and technologies that are used to analyze certain sets of data in order to help an organization gain new, hitherto unnoticed insights. Even the shortest analysis of how modern business intelligence tools work would require far too much time and space.

It is probably best imagined as a replacement for enormous teams of data analysts form the pre-computer era, trying to work out what the data collected by their corporation means. Nowadays, thanks to spectacular computing powers, organizations can achieve this will relatively affordable BI software.

In the legal industry, BI software is utilized for a number of purposes, most of which are purely operational and have nothing to do with how actual cases are handled from a legal standpoint.

Improving Finances

Running a successful business is about making as much money as possible. We are all adults here and we can admit it. In order for a law firm to be successful, it is not enough to win cases. It also has to bring in revenue.

Often times, even with great finance departments, law firms do not operate at peak efficiency when money is in question. For instance, some law firms rake in huge annual fees, but realize that the net profit is smaller than that of companies with half the fees. This is just a single example.

With a modern piece of business intelligence software, law firms can identify certain patterns and trends that will suggest what they could do differently in order to improve their bottom line. These patterns and trends can appear over such long periods of time that people simply cannot see them clearly.

Streamlining Internal Processes

Anyone who has ever had to manage a law firm with more than a handful or attorneys and as many cases knows how complex it can get to manage all the internal processes that make up the day-to-day operation of a law firm.

New matter and client intake and various conflicts that arise from a large number of attorneys and teams working on an ever-increasing number of matters can create a logjam within the firm, hurting productivity, jeopardizing actual cases and driving away clients.

Recently, a large number of big law firms have started utilizing business process management to handle these internal matters and this is where BI can make things even better. It helps analyze the data procured via BPM and identify truly problematic areas in day-to-day functioning of a law firm.

Keeping Clients Informed

Clients acknowledge and appreciate transparency at every step in their dealing with a law firm. And while business intelligence software will not be used to inform clients about how their matters are being handled, it can be used to provide them with insights into total dollars spent, hours billed, write downs and write offs and much more. This greatly reduces the cases of billing disputes as clients are given full insight into what your firm is doing for them and what they are paying for.

Another way in which BI can be used by law firms and that has to do with clients staying informed is through marketing. Namely, it is already common knowledge that business intelligence can be used to aid marketing departments identify the right timing, as well as vectors and target audience for marketing their law firm's services. This is particularly true for law firms which earn much of their annual fees from past clients who sometimes need a bit of a nudge to remind them you are there.

Closing Word

All law firms that are trying to improve their day-to-day functioning and find new ways to enhance the service they provide for their clients should definitely consider business intelligence. It is the way of the future, plain and simple.