April 27, 2007
Economic Outlook for Law Firms
Bruce MacEwen, an economist at heart, reminded law firm leaders that sooner or later, they are going to face another recession. His post on Adam Smith, Esq. noted that the Hildebrandt/Citigroup 2007 Client Advisory anticipates that the 2007 bottom line for U. S. law firms will be squeezed by increasing cost with little, if any, revenue growth over 2006.
Morepartnerincome’s outlook for midrange law firms is more optimistic. Nevertheless, as Bruce reminds us “….we all know one lies in store sooner or later.” The important question posed by MacEwen is, “Will you be ready?”
Prepared organizations not only survive the periodic downturns of a cyclical economy, they prosper in relation to peers. They come out of recessions stronger with increased market shares. Bruce MacEwen’s post includes some examples from the commercial world. Morepartnerincome offered the following 2007 advice in the earlier post Law Firm View of the Economic Outlook for 2007:
While the outlook is for a good year, it may be one best suited to consolidating your gains and strengthening your law firm financial health and operation performance—emphasizing improved planning, workflow efficiency, and the firm’s overall performance metrics. Concentrate on improved effective rates, better scheduling and delegation to the firm’s associates and paralegals as well as on faster billing and collection. Use this period to replace any remaining legacy systems. You don’t want to get caught in recession or downturn with systems that are no longer supported or that become operationally unsound. Nor do you want to have the competitive disadvantage of being behind your peers.
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Filed under Operations by Tom Collins
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