Are your law firm’s budgeting and forecasting processes too much like pin the tail on the donkey, full of blind guesstimates, wishful targeting, and unpredictable results?
This article reveals how to use modern automation to sharpen your vision with data-driven forecasts and hit the mark every time with precise budget management practices. See how to eliminate resource-guzzling manual processes and confidently guide your firm to higher profits with:
- profit-led pricing strategies based on historical metrics.
- fresh insights to develop strategic initiatives that pay off.
- more cost-effective time and resource allocations in your firm’s budget.
- engaging in proactive conversations with clients about matter budgets.
Law Firm Budgeting and Forecasting in a Bygone Era
Many law firms use best-of-breed software applications to manage timekeeping, billing, enterprise resource planning, payment processing, customer relations, document management, and other needs. Then, to perform any type of financial analysis, staff members waste hours as they manually:
- search for, identify, and extract relevant information from several siloed applications,
- process the information into compatible data formats, and
- enter the new data into another stand-alone application to begin analyses.
After weeks of hard work, finance teams remain restricted to working with limited, outdated data sets. Analytical results lack depth because it’s too challenging to revise or add new data points or to trace where data originated to add context.
Modern firms solve these issues by incorporating a financial analytics platform that delivers the many advantages of automation. Here are four ways automation will help you streamline your budgeting processes today for more robust and prosperous budgeting and forecasting in 2023.
Speed Law Firm Budgeting and Forecasting with Integrated and Centralized Data Management
Take an integrated approach to sourcing data. An automated platform pulls and processes information from multiple software applications, then makes the data available in a single location. This delivers three distinct advantages:
1) You effortlessly combine data from a variety of sources.
2) All the information is now centrally located.
3) You can update forecasts and budgets with just a few clicks.
Manual labor no longer limits your capabilities. You can analyze multiple scenarios and immediately include additional data points, alter inputs, and modify calculations. Live links connect you directly to more information for context.
Automation never tires, and it performs exactly as you tell it to. You can dig deeper and gain fresh insights working with the most up-to-date data available from more sources.
Forecast Budgets with Precision and Accuracy
In your new data-rich environment, you can also learn from the past to better predict the future. Law firm timekeeping and accounting systems contain critical information for understanding the resources needed to complete specific tasks and close matters successfully—as well as which resourcing trends indicate when matters are close to flying off the rails or floundering in the dark. But firms could never sift through such vast oceans of details manually.
Now you can rely on the speed of automation to analyze historical matters. You get data-backed insights to 1) forecast more accurate billing times for future tasks, and 2) develop profit-led pricing strategies based on actual firm experience rather than guesstimates. Over time, your firm can gain clarity into how decisions impact the firm to optimize pricing and resource allocation strategies.
An automated platform can also organize a prospective matter’s forecasted entries into assigned phases and matter codes. This enables lawyers to break a matter into key deliverables or phases and align those stages with value in the minds of clients.
Gain Actionable Insights with Dynamic Reporting
Increase visibility into budgeting processes with a variety of dynamic dashboard and reporting options. Automation allows you to run ad hoc requests in seconds and change a report format with a click. Forecast and report budget variance in the same format for more useful and direct evaluations. Compare any combination of actuals, budgets, and forecasts to improve your predictive capabilities.
With the right budgeting software, you can swiftly adjust any analysis and include more details in reports to fully inform your decisions. Run several what-if scenarios to discover actionable insights, then choose the optimal path forward. Click to drill-down to source data. Graphical reporting options help to enlighten discussions with department leaders and clients.
Protect Firm Budgeting Processes with Granular Security Levels
Automated security permissions serve as a dependable gatekeeper of your firm’s financial data. Specify who can enter, view, and manage data on a line-by-line, person-by-person basis to limit access and protect confidentiality.
Each team member works only with the budget information specific to their area of responsibility. Work efforts are precise and targeted as automation instantly:
- generates appropriately tailored reports for each person to work with.
- tracks activities to hold everyone directly accountable for their input.
- ensures progress with automated reports and reminders.
- accelerates approvals for faster overall forecasting and budgeting practices.