Tracking and Improving Performance with Legal Services Enterprise KPIs

Introduction:

Having effective business performance metrics is an important key to successful business operations. By tracking and calculating key performance indicators (KPIs) in the legal services industry, you can measure performance and identify areas for improvement. The seven KPIs that are most commonly used to track the performance of legal services activity include number of clients served, volume of cases closed, average client retention rate, average revenue per case, average fees by department, average monthly revenue and average percentage of unresolved cases.

These seven KPIs are used to monitor various aspects of legal services business performance, such as attorney and staff performance, client satisfaction, and overall profitability. By tracking and calculating these KPIs, you can understand how the legal services business is performing and where improvements can be made.

This blog post will discuss what the top seven legal services business KPIs are and how to track and calculate them. He will explain why these KPIs are important for a successful legal services business, how to track and calculate them, and provide some tips for improving performance.

Number of customers served

Definition

The number of clients served is a key performance indicator (KPI) that measures the number of clients a legal services company has served in a given period. This KPI is crucial in helping legal professionals determine the success of their business and how to improve their services.

Benefits of Tracking

Tracking the number of clients served helps legal professionals gain insight into the effectiveness of their services and the demand for their services. It also helps them identify areas where they can improve their services and maximize the number of customers they serve. This KPI can also be used to measure the performance of individual attorneys and set goals for the legal services business.

Industry Benchmarks

Industry benchmarks for the number of clients served vary by legal services firm. Generally, legal services firms should strive to serve at least 100 clients in a given period in order to be considered successful.

How to calculate

The number of customers served is calculated by taking the total number of customers served in a given period and dividing it by the total number of days in that period.

Calculation example

For example, a legal services firm served 200 clients in the past 30 days. To calculate the number of customers served, divide 200 by 30:

Tips and Tricks for Tracking the KPI

• Regularly track the number of customers to get an accurate picture of the success of your business.
• Compare the number of clients served to industry benchmarks to ensure you are meeting your goals.
• Set goals for the number of customers served to help you achieve your goals.
• Analyze your data to identify areas for improvement and maximize the number of customers you serve.

Closed case volume

Definition

Case Closed Volume is a Legal Services Key Performance Indicator (KPI) metric that measures the number of cases or tasks closed by a law firm or legal department over a given period of time.

Benefits of Tracking

Tracking the volume of closed cases is important for understanding the productivity of a legal services business. It allows the firm to monitor the performance of its lawyers and staff, measure the effectiveness of its processes and identify areas for improvement.

Industry Benchmarks

Industry benchmarks for volume of cases closed vary depending on the type of legal services business, size of business, and types of cases handled. Generally, a higher volume of closed cases is associated with higher productivity.

How to calculate

Closed case volume is calculated by dividing the total number of closed cases by the total number of open cases over a given period.

Calculation example

For example, if a law firm opened 100 cases in a month and closed 80 of them, the volume of closed cases would be 80%.

Tips and tricks

• Set realistic goals for closed case volume.
• Evaluate the performance of lawyers and staff on the volume of cases closed.
• Track the volume of closed cases over time to identify trends.
• Measure the effectiveness of process improvements on the volume of closed cases.

Average customer retention rate

Definition

The average client retention rate is a measure of how well a legal services firm is able to retain clients. It is calculated by taking the percentage of customers who have stayed with the company for a certain period of time and dividing it by the total number of customers.

Benefits of Tracking

Tracking the average client retention rate is important for legal services firms as it is a good indication of the quality of services provided. It can also help identify areas where improvements need to be made in order to better retain customers. Tracking this metric can also help identify potential growth areas and expansion opportunities.

Industry Benchmarks

The average client retention rate can vary depending on the industry in which the legal services firm operates. Generally, the higher the rate, the better the company is at retaining customers. The legal services industry benchmark is typically around 80%.

How to calculate

The average customer retention rate is calculated by dividing the number of customers who stayed with the business for a certain period of time by the total number of customers.

Calculation example

For example, if a legal services firm has 100 clients and 80 of them have remained with the firm for at least 12 months, the average client retention rate would be calculated as follows:

Tips and tricks

• Be sure to track the average customer retention rate over time to monitor changes and identify potential areas for improvement.
• Try to implement strategies to increase the average customer retention rate, such as providing excellent customer service and offering loyalty incentives.
• Monitor industry benchmark to ensure your legal services business is operating at industry standard.

Average revenue per case

Definition

Average revenue per case (ARPC) is a key performance indicator (KPI) that measures the average revenue generated for each legal case. This is an important metric for legal services companies because it provides insight into business profitability and the effectiveness of lawyers and legal teams.

Benefits of Tracking

Tracking ARPC can help legal services companies identify profitable cases and analyze the cost of legal services. It can also help legal services businesses gain insight into their pricing structure and ability to generate revenue from each case.

Industry Benchmarks

The average turnover varies widely across all industries, depending on the type of legal services provided and the complexity of the case. Generally, the average revenue per case must be higher than the cost of the legal services provided.

How to calculate

Average revenue per case can be calculated by dividing the total revenue generated by the total number of cases. The formula is:

Calculation example

For example, if a legal services business generated ,000 in revenue from 10 cases, the average revenue per case would be:

Tips and tricks

• Track ARPC for each type of case to identify profitable cases and areas for improvement.
• Compare ARPC to the cost of legal services to determine the profitability of each case.
• Monitor ARPC over time to identify trends and opportunities.

Average fee per service

Definition

Average fee per service is a KPI that measures the average fee charged for each service provided by a legal services firm. This metric helps legal services companies monitor the performance of their departments, as well as the profitability of each department.

Benefits of Tracking

Tracking average fees per service allows legal services firms to better understand the cost and profitability of each service they offer. This metric can also help them make decisions about which services to continue or which to abandon or modify. Tracking average fees per service can also help legal services firms set competitive rates for their services.

Industry Benchmarks

The average fee per service will vary depending on the type of legal services business and the type of services they offer. For example, a law firm specializing in corporate law may have higher average fees per service than a single practitioner offering general legal services.

How to calculate

The average fee per service can be calculated by dividing the total revenue generated by the legal services activity by the total number of services provided. The formula is:

Calculation example

For example, if a legal services business generated 0,000 in revenue in a single month and provided a total of 200 services, their average fee per service would be:

Tips and tricks the KPI

To maximize their average fee per service, legal services firms should regularly review their services to ensure they are charging competitive rates. They should also monitor their average fee per service to ensure that they are generating sufficient profit from their services.

It is also important to note that the average fee per service should not be taken as an absolute measure of success. There may be instances where a lower average fee per service makes sense and can still be profitable. For example, a single practitioner may offer lower fees to attract more clients.

Average monthly income

Definition

Average monthly revenue is a key performance indicator (KPI) that measures the total revenue generated by a legal services business over a given period of time. This metric is usually calculated on a monthly basis but can be calculated over a period of time.

Benefits of Tracking

Tracking average monthly revenue allows legal services businesses to regularly measure their performance and make adjustments to increase efficiency. It also allows them to benchmark their performance against that of other legal services firms in their industry, which can help them identify areas for improvement.

Industry Benchmarks

Industry benchmarks for average monthly earnings vary depending on the size and type of legal services business. Generally, larger legal services businesses will have higher average monthly revenues than smaller businesses. Additionally, firms that specialize in certain areas of law may have higher average monthly revenues than those that provide more general services.

How to calculate

To calculate the average monthly revenue for a legal services business, you need to total the revenue generated for the month in question and then divide it by the number of months in the period. The formula for this calculation is:

Calculation example

For example, if a legal services business generated ,000 in revenue over a three-month period, the average monthly revenue would be calculated as follows:

Tips and Tricks for KPIs

• Track average monthly earnings regularly to monitor performance and make adjustments as needed.
• Compare average monthly earnings to industry benchmarks to identify areas for improvement.
• Identify the services that generate the most revenue and focus on those.
• Strategize to increase average monthly income.

Average percentage of unresolved cases

Definition

Average percentage of unresolved cases (APUC) is a metric that measures the percentage of cases that are unresolved after a certain period of time. The metric is an important indicator of a legal services firm’s effectiveness in providing timely and satisfactory resolution for clients. It is calculated by dividing the total number of unresolved cases by the total number of cases.

Benefits of Tracking

Tracking this metric can help a legal services firm identify areas where their services fall short and can help them take corrective action. This metric can also be used to measure customer satisfaction and judge the effectiveness of their processes. Additionally, tracking this metric can help legal services companies set goals and track their progress over time.

Industry Benchmarks

The industry benchmark for the average percentage of unresolved cases is generally less than 10%. This means that the majority of cases are resolved in a timely manner.

How to calculate

The average percentage of unresolved cases is calculated by dividing the total number of unresolved cases by the total number of cases:

Calculation example

For example, if a legal services company has 100 cases and 10 of those cases are unresolved, their average percentage of unresolved cases is 10%:

KPI Tips and Tricks

• Track the average percentage of unresolved cases over time to identify areas for improvement.
• Set goals for the metric and monitor progress toward those goals.
• Identify and resolve any issues that may cause unresolved cases.
• Compare the average percentage of unresolved cases to industry benchmarks to gauge performance.

Conclusion

The seven KPIs discussed in this blog post are the most commonly used to track legal services business performance. By tracking and calculating these KPIs, you can understand how the legal services business is performing and areas for improvement. Taken together, these KPIs can help any legal services business measure performance and make improvements for greater success.

Here are some tips to improve the performance of your legal services business using the KPIs discussed:

• Monitor the number of customers served, volume of cases closed, and average customer retention rate for an indication of customer satisfaction and to identify areas for improvement.
• Monitor average revenue per case and average fee per service for an indication of profitability.
• Monitor average monthly revenue and average percentage of unresolved cases to identify and address bottlenecks in the system.

By tracking and calculating these seven legal services business KPIs, you can measure performance and identify areas for improvement to ensure your business is running as smoothly and efficiently as possible.