You’re standing at a crossroads and have to decide which practice management system (PMS) would be the best upgrade for your firm. Which should you choose? The majority of law firms will take the well-trodden path and upgrade to the latest and greatest PMS (nothing wrong with that). But a rising number of firms are opting for a move into the ERP world. Why? Here are three reasons firms are considering the road less traveled.
1. Access to multi-industry best practices
A lot of people think their industry is unique. Legal professionals are very particular about the business of law. But how different are law firms, really, from other firms in other industries all over the world? The reality is – they’re not that different.
Law firms have people, clients, matters, and they sell “things.” But so do accounting and other professional services organisations, and they’ve been using ERPs for years. Their business models are very similar to law firms. Construction firms, for example, have projects also known as “matters” and use people to support those projects, some from within the organisation and some from outside. Their contractors are like the legal industry’s counsel.
Many industries are comparable across their core business systems, whether or not they sell services. Doing your accounts is not massively different in finance companies, construction companies or law firms. One of the pros of going with an ERP is that you can apply best practices that have been developed over multiple industries to help standardise and elevate your firm’s performance and increase productivity.
2. New levels of efficiency and profitability
Law firms are not given enough credit when it comes to technology. They may not be on the cutting edge of digital transformation, but they’ve been moving forward, becoming more sophisticated, and looking to streamline business processes. Firms are looking at more innovative ways to capitalise on their greatest asset – their people. This goal is not always easy to achieve when “people data” lives in the same system as client relationship and finance data. In an ERP system, this level of detail is accessible right off the bat.
Understanding your talent pool, what skills and services are utilised across clients, and ultimately how efficiently and profitably your people are delivering those services are power metrics to own. Ponder how that might be achieved today with just a PMS, which may or may not talk to your HR or CRM system. This insight is very difficult to achieve if the business processes in each department owning those systems don’t support a unified view.
3. Greater flexibility in deployment options
There’s a perception in the marketplace that ERPs are only for the big firms with very deep pockets, who can afford to invest millions of dollars implementing a system. There has always been this general feeling that “it’s just too big a thing for us to do.”
ERPs are no longer these big, scary, rigid beasts. They’re very process oriented, yes, but you can make those processes as simple or complex as you like. Plus, the trend for software is for many sizes and options, so firms can adopt an enterprise-wide solution in a lightweight environment and scale as needed. Technology has enabled this flexibility and scale.
Words of advice when making your decision
When choosing whether or not to pursue an ERP system, you need to think through what you want to achieve. Does your firm want to standardise and apply best practices developed based on experience across multiple industries? If so, ERP may be the way to go. Or is it more important to stick to processes developed specifically for the legal industry with a higher level of flexibility or variance? Then upgrading your PMS may be the right call. It really does depend on what your firm wants to do and what it wants to achieve.
Regardless of the path you choose, upgrading your PMS or implementing ERP, you want to stick to standard as much as possible. You don’t want one attorney in one room doing things one way and the next room down the hall, another attorney doing something else in a completely different way. You want to implement the most efficient and streamlined one-size-fits-many approach across departments and attorneys. Avoiding customisations minimises your implementation cost and complexity and helps minimise ongoing maintenance effort and fees.
Firms don’t always have experts in-house that can support the depth of skills required for a system conversion or implementation. You need to source and use your supply chain effectively to ensure delivery to a high standard. Draw on the experience of others and work with a proven technology services provider. For example, Wilson Allen offers technology transition advisory services to help firms evaluate new practice management software and plan for improvement.