I almost didn't go to Clio Cloud Conference.
Conferences are expensive. Frankly, between travel and accommodations, I was skeptical that a legal conference could serve up the goods to justify the cost. My last big conference experience was Inbound a few years ago, which blew me away — but it was also right around the corner in Boston.
Boy, am I glad I went.
You see, we're at a turning point at the legal profession. To be fair, I think that's probably ALWAYS true of the legal profession, but it's also true today. Gary Vee describes it as "a bigger tidal wave than the one we just went through," which is a lot, considering Gary Vee's observation that "everything you know has happened in the last decade."
Firms of all sizes are being squeezed from all sides to be more accessible and more affordable. Meanwhile, technological innovation is exploding all around us and actually making it POSSIBLE for us to respond to those pressures (even as we worry about whether the technology will eventually replace us...), while also fine-tuning our businesses to be as efficient and profitable as possible. However, clients are also finding and consuming legal services differently every year — every day — and what's "efficient and profitable" today may seem obsolete in a surprisingly short amount of time.
As the self-described "system of record" for online practice management systems and a flexible platform for an ever-growing list of integrations, Clio is superbly positioned to help us do that. And it turns out, that's what Clio Cloud Conference is all about.
In no particular order, here are 4 inescapable take-home lessons from Clio Cloud Conference 2016.
1. Lawyers are wasting time. Like, a LOT of time.
Hopefully you're sitting down, because I'm about to drop a really sobering statistic on you.
Solo attorneys are getting paid for less than 1/5 of their time.
That's not a typo.
In Jack Newton's opening keynote, we got a sneak peek into some of the data from the Legal Trend Reports. The most sobering information shared to date is from this breakdown of what one day looks like for the average solo attorney.
When you've picked your jaw off the floor, let's break this down a bit more.
- Utilized hours are the ones spent on billable work.
- Realized hours are those that actually make it onto a bill, after discounts and write-offs.
- Collected hours are what you actually get paid for.
So, in an 8-hour workday, the average solo attorney is only getting paid for 1.4 hours of their time!
The first thing you notice, and where we really should be focusing ALL our attention right now, is the utilization rate. Solo attorneys are utilizing less than a quarter of their workday (22%, per the report) on billable work. The average across all law firms isn't much better — only about 28%.
Where the hell is that time going?
Remember when I wrote about the numbers behind making a living in ADR? I pointed out that solo attorneys "wear all the hats" and shouldn't plan to bill more than a few hours a day. These stats are consistent with that advice.
"But wait," you say, "I'm not wasting that time! I'm spending it on necessary office functions! Administration! Marketing! Bookkeeping! This boat doesn't sail itself!"
You're right, of course. That stuff is absolutely necessary. But how much of it requires your personal attention or legal skills? How much of it could be automated, systematized, or delegated at very low cost — a measly fraction of your billable rate? Too much of lawyers' time is being wasted on work that they really should not be doing!
With the right software, systems, and support, we should be able to blow that utilization gap out of the water.
2. We're still struggling to get paid on time.
The Legal Trends Report shows that collected hours are about 86% of realized hours. In other words, lawyers are getting paid for more than 4/5 of the hours they actually bill. That's still too low for my tastes (why not 100%?), but that's not the real problem.
The real problem is how long it takes to get paid. The Legal Trends Report also shows that the average time to payment is over 30 days. Given that most legal invoices are probably either due on receipt or net 30, that means the average payment is overdue.
It's no surprise, then, that there were two separate sessions about how to get paid faster and easier, using Clio's invoicing, trust request, and credit card payment features. (The average time to payment drops to 20 days when you take credit cards.) Meanwhile, vendors like FundBox are offering ways to unlock the capital tied up in past due invoices.
I've written about getting paid more reliably before, and it's nice to see the problem getting so much attention. Still, after speaking with the folks at Clio and LawPay, it's clear that there's more work to be done. Here's my personal vision for a truly smooth payment system:
- As part of intake, each client creates an online payment profile that stores the details of the credit card or bank account they'll use to pay their invoices, much like Amazon or PayPal does today.
- The client's fee agreement includes a preauthorization for the lawyer to use that payment profile automatically when invoices are due. A detailed invoice still goes out (and there could be a short review period before the actual payment), but we eliminate the question of when the payment will actually come through.
- This system could be used instead of trust accounting or in conjunction with a modest trust balance in case a payment is rejected (i.e., an evergreen retainer).
- Card details change? Client changes banks? No problem — they just login to their account and change their payment profile.
It is possible together parts of this system from a hodgepodge of Clio, LawPay or Stripe, and electronic fee agreements, but it's a bit clunky from an administrative perspective. I've scoured all the big invoicing and payment systems — including Clio and LawPay, but also beyond law-specific solution to include Harvest, FreshBooks, etc. — and I've yet to find a system that offers this all in a neat, streamlined process. Can someone please make it happen?
3. Lawyers still need a lot of help with marketing.
A number of the sessions at Clio Cloud Conference 2016 dealt with marketing, which makes sense, since new client acquisition is a top concern for law firms of all sizes. Tuesday's opening keynote by Melanie Heller of Bloomberg law was about how solos and small firms can use branding and technology to "fight way above your weight class." Later in the day, there was a session on social media marketing and a packed-room presentation by Brian Wilson, the Texas Law Hawk. The Law Hawk was a highlight of the program. Interspersed with showings of his hilarious marketing videos, he shared his experience of making them, including what worked and what didn't.
What's surprising isn't that marketing got so much attention at the conference — it's how incredibly basic the information provided was.
Consider the session titled, "How My Client Landed a Million Dollar Client Through Facebook." I went to that session expecting an in-depth dive into market segmentation, retargeting, calls-to-action, and landing page best practices. Instead, the message could easily be distilled into a handful of bullet points:
- Create content.
- Share your content on social media.
- Be authentic.
This is content marketing 101, folks. This is where lawyers are as a profession.
The best marketing advice came, of course, from Gary Vee. But, as inspirational as his closing keynote was, his message really wasn't all that more sophisticated.
Lawyers need to start putting themselves out there.
That's it. We need to tell stories about our brands, and we need to learn how to use social media to get eyeballs on those stories. It's really that simple. The Law Hawk didn't do anything extraordinary, really. He created a few pieces of compelling content (on an incredibly low budget!) and put them out into the world. When a video got reactions — good or bad — he used those reactions to fine-tune his next video. Rinse and repeat. Put out content, see what works, and put out more content.
And the kicker, as Gary Vee pointed out, is that all you need to make this happen is KNOWLEDGE and HARD WORK.
Again: knowledge and hard work.
Do we know any profession that prides itself primarily on those exact same qualities?
4. Technology has some (but not all) of the answers.
Quick review of lessons 1-3:
- Lawyers are wasting a LOT of time.
- Lawyers are struggling to get paid on time
- Lawyers need a lot of help with marketing.
The good news is, technology can help with a lot of this. Besides Clio, there are systems that integrate with Clio to streamline many of the day-to-day, non-billable tasks. Systems like LawPay, Lexicata, Ruby Receptionists, and many more. And they're ridiculously affordable. If you bill $232 an hour (the national average, per the Legal Trends Report), a system that costs $30/month and saves you several hours a month of administrative work should be an instant buy. Yes, you'll have to take the time to learn the system and set it up for your practice, but that's a small price to pay for closing that utilization gap!
There were a few opportunities for automation that deserved a bit more attention. For example, I save hours each week (not even including the cost of interruptions) using x.ai, and I spoke with others who gush about the benefits of self-scheduling services like Calendly and Acuity Scheduling. CaseMail was only briefly mentioned as a way of simplifying what's normally a time-consuming physical task: sending mail. And with all the focus on the marketing, where was the discussion of tools that make social media marketing orders of magnitude easier and less time-consuming, like CoSchedule and Buffer?
The most important SLIDE that almost nobody saw...
The data are important because they describe the problem of the utilization gap, and it's good to know that there are technological solutions to various pieces of the puzzle. But I sometimes felt the sessions were missing concrete calls to action, steps you can follow today to start closing the utilization gap.
One of the most important take-aways of the entire conference was seen by only a handful of people, hidden in a single slide, in a breakout session called "Learning to Thrive as a Tech-Savvy Lawyer," presented by Nehal Madhani of Alt Legal. Maybe if the session had been called, "Save Thousands of Dollars by Systematizing and Automating Your Practice," more people would have attended.
Here it is:
This is a business operations flowchart, and there are opportunities for systematization, automation, and delegation in each and every step. Madhani's presentation described how you can use APIs and third-party integration services like Zapier to do that, but you could also use services that integrate with Clio directly, or even hire a human being (radical, I know) to offload some of the non-billable work.
DO THIS NOW.
Map out your business. Follow the life of a case from marketing your business, through initial call or email from a potential client, to closure. Start at a high level, and then get more granular, including all the little administrative functions along the way. Then, look for ways you can offload that work and close the utilization gap in your practice.
Just one or two changes can make a huge difference, and products like Clio and integrated services are making it easier every single day.
*Clio did not sponsor this post and the opinions shared in this post are mine alone. However, I am a Clio affiliate and will receive some compensation if you become a paying Clio customer through this link.