Is the Billable Hour Holding Your Firm & Staff Back?

//Is the Billable Hour Holding Your Firm & Staff Back?

Billing by the hour may be the traditional invoicing method for small law firms to charge clients, but that doesn’t necessarily mean it’s the best option for you and your clients. Recently, many small law firms have begun moving away from hourly billing, opting for a flat rate fee based on each client’s legal needs. Has your firm ever reconsidered its billing practices? In doing so, you may find a new approach works better for both your firm and your clients.

Consider These Law Firm Billing Practices

Prioritize value, not hours

When your firm charges clients by the hour and holds lawyers to billable hour targets, you send a message about your priorities. This practice tells your attorneys that the value of their work can be measured by how much time they spend on a given matter, rather than by the quality of their final product. Quality is always better than quantity.

If you free your attorneys from the billable hour, you encourage them to adopt efficient practices that could streamline service and provide a better experience for both lawyers and clients. You also free your attorneys to better manage their time by rewarding the timely completion of high-quality work.

Give clients clarity

Since clients hate the uncertainty that comes with billable hours, you can greatly improve their experience with your law firm by providing upfront, unchanging costs.

When determining how much to charge for certain types of work, your firm will still use time estimates to determine the correct amount to charge. While this may result in some matters that bring in less money-per-hour than expected, your firm will gain client goodwill and loyalty. The firm can also benefit from increased certainty surrounding incoming payments, and even pick up more clients in the time saved through more efficient practices.

What type of billing process does your small law firm use? How does your method help your firm’s productivity and client relationships? Share your thoughts with us on Twitter by tweeting at @SmokeballNews!


By |June 18th, 2015|

About the Author:

For years, Josh has helped lawyers become more organized, productive, and profitable. A trained litigator, Josh came to Smokeball from a large east-coast law firm where his practice focused on franchise, insurance, marine, and general litigation. His work with Smokeball, and his continued passion for what he does each day, is driven by a desire to help lawyers and their staff do better in every way. Knowing well the stress and strain put on today’s legal professional, he regularly focuses on improving work and life in the law. He has traveled the country working with and learning from lawyers and their staff. Josh speaks regularly to bar associations about successful law firm practices and other legal topics. Recent notable engagements have been with the Chicago Bar Association, the Illinois State Bar Association, and the Missouri Bar’s Solo and Small Firm Conference. In addition to his work at Smokeball, Josh serves on the Writing Resource Center staff at The John Marshall Law School. Besides legal technology, his research interests include judicial decision-making, jury decision-making and psychology, and legal writing. He has written and overseen research exploring causal effects of sex/gender on federal appellate court decision-making, and assisted with research for a forthcoming textbook on judicial decision-making. Additionally, Josh sits on the Board of Directors of Chicago-based Community Activism Law Alliance and on the Board of Directors of Chicago Fringe Opera Company. Josh holds his J.D., cum laude, from Washington University in St. Louis, where he served as a Senior Editor of the Wash. U. Law Review, held the prestigious Thompson Coburn Research Fellowship, served as Research Assistant to then-Vice-Dean (now Chancellor) Andrew D. Martin, and clerked at the U.S. District Court for the Eastern District of Missouri. He holds a B.A. in Political Science and a B.M. in Music Performance with Honors Scholar distinction from the University of Connecticut, making him a Huskies basketball fan through and through. Follow Josh’s activity on LinkedIn, and keep up with new articles on the Smokeball Blog.