Competitive Assessment


Initial Information Request

Basic Information - Excel Form(If Possible) - 3 Years Historical & Current YTD

Employee Detail

Employee List(TKPR Profitability, Compensation Analysis, Overhead Analysis, Staffing Ratios, Historical Payroll) - Salary, Bonus History, Raise History, Position, Hire & Termination Date, Benefits Data, Secretarial/Staff Allocation Contract Labor

Working Attorney Productivity Reports

Working Timekeeper Productivity(TKPR Graphs, TKPR Profit, TKPR Comp Models) - Billable Hours, Billable Value, Amount Billed, Amount Collected & Average Rate
Write-off Reports
Any Expectations - Hours, Billings, Collections

Client Productivity Reports

Top Client Fees Billed/Collected(Concentration of Risk) - Sorted on Working Timekeeper & Originating Attorney - Amount Billed & Amount Collected
Top Client Fees Billed/Collected(Concentration of Risk) - Sorted on Practice Area - Amount Billed & Amount Collected
Working Timekeeper by Client(Workload Distribution) - Billable Hours, Amount Billed & Amount Collected
Originating Attorney by Client(Competitive Comp & Workload Distribution) - Billable Hours, Amount Billed & Amount Collected
Extended Services(Marketing plan, Client Profitability, Partner Compensation Analysis, Associate Performance)

Financial Statements

Income Statements, Balance Sheets, General Ledger Asset and Expense Accounts(Income Statement Ratio Analysis, IS Breakout, Cost Per Hour)
Current AR and Work In Progress (WIP) Aging - For concentration of risk analysis

Operating Agreement & Partner Compensation Plan

Operating Agreement with Amendments and Description of Partner Compensation Plan

IT Information(Cost Per Seat)

Application Hardware & Vendor List(Airtable Form)(Cost Per Seat Estimate)

Marketing Financial Information(Metric Analysis, Marketing Effectiveness Assessment)

Firm Marketing Budget - 3 Years
Business Development Sources - Sources of New Business - New Client List and Acquisition Source
Client Acquisition Budget
Client Retention Budget
Estimated Time Spent by Lawyer on each Marketing Activity

Operating Efficiency Data

List of open files with open dates
List of closed with open and closed dates
List of cases by managing lawyer


Cash Flow, Debt, & Equity Analysis

Assessment of Net Cash Flow, Debt Levels, & Equity Levels(Draw & Distribution Policy) - Benchmarked 1 Page Summary - TBD

The idea to determine if the firm's partners are taking out too much money too quickly. KPI's Number of months expenses in cash Cash/Average Monthly Expenses/ Concentration of Capital (Capital by Owner compare to ownership %, Short Term Debt (LOC)/AR WIP, Total Debt/AR+WIP + Net Book Value of Hard Assets Capital mix % Debt, Undistributed Earnings, Paid-In Capital Prior Year Capital Accounts)

Operating Performance of the Firm

Revenue & Expense Benchmark Analysis - Revenue Per Lawyer, Revenues Per TKPR, Expenses Per Lawyer, Expenses Per TKPR, Percent of Fee Analysis in Key Areas - All Compared Against Best Practice Range
1 Page Summary - TBD

Concentration of Risk

Analysis by Client, Lawyers, Originators, Practice Area, Referral Source In Terms of People, Hours, Income & Attorney Profit, AR and WIP Analysis assess the viability of collections based on aging. The metric is % available for collateralizing a bank loan- use the standard indicated in a bank borrowing base.

1 Page Summary - TBD

Financial Reporting Review and KPI's

Assess the adequacy of the financial report package available to the partners: Is there an identifiable economic model?

At a minimum, the financial reporting package should include Income Statement, Balance Sheet, Timekeeper Profit, Production (hours, billings, collections) by timekeeper, Client stats, files opened and closed, AR and WIP analysis, historical comparatives, and realization and write off accounting.

Average Worked, Billed and Collected


This information can come in report form or through on-demand dashboards. Graphical representations are helpful but not absolutely essential.


Historical Performance of Revenue Generators Productivity Against Benchmarks
Extended Service - Realization by Originator & Client, Associate Performance

Capacity Analysis

Capacity Analysis by Position

Revenue Generator Productivity Benchmark Analysis

Historical Performance of Timekeeper Productivity
Recommended Performance Ranges Based on Experience and Practice Area

Revenue Generator Profitability

Profit by Timekeeper - Time Period Dictated by Data


Payroll by Position

Overhead Analysis

Analysis of Overhead by Position

Secretarial/Staff Allocations

Allocate Secretary & Staff to Respective Attorneys


Planning Aptitude (strategic and tactical)

Questionnaire - AirTable or Google Form

Assessment of the firm's commitment to an attorney planning process.

Strategic vision (based on years of experience and position in the firm), Administrative Activity, Bar Professional and Civic, Marketing, Pro Bono, Recruiting, Skill Development, Solicit Feedback - Scope of the questionnaire is at the assessment level. We are not creating a plan in this step.

We are seeking a description of hours spent and activity types in these areas. See the knowledge base - I think we can list the most common activity types whether they do them and how much time they spend on them. For example, bar association participation - participant, committee service, leadership, etc.

Individual lawyer questionnaires and firm management questionnairre.


Grade Assessments and Create Deliverable

Use grading scale to indicate basic, intermediate or advanced awareness in these key areas. Look for institutional advantages or disadvantages.

Here is some additional Information


Attorney Performance Measurement & Rewards

Review attorney compensation plans

Review any formulas or written documents: Compare the overall comp ranges for attorney pay to best practices. For example, 30-40% collections. Percent base salary to total comp, at risk compensation (fee sharing)

Are bonus plans too hard too easy? Are they achievable?

Is there a benefit for business development or managing clients or cases?

Comment on incentives and disincentives


Review the firm's current application mix against the best practices mix that includes:

Productivity Software, PDF Conversion Software, Document Automation/Assembly Software/Time Billing and Accounting/Practice Management, E-Discovery, Digital Dictation, Virtual Call Service, ability to easily compute case management metrics - See KPI's for operating efficiency below

Survey of Existing Applications (AirTable)

A simple listing of the application survey to include common features listing and use of those features and perceived benefits.

Application Survey

Best Practice Comparison

Strategic Tech Survey

Survey of management - managing partner and or administrator -

Purpose of this survey is to determine the firm's awareness of the key benefits of app's in the 8 key areas, ask them how well they perceive there existing applications provide these key benefits, do they believe the key benefits are applicable to their practice.

Grade Assessment of the firm's technology awareness and competitive standing

One page deliverable and rating their competence and awareness of the available technology, features and benefits in 8 key areas.


The assessment consists of two components: Does the current marketing system add to the viability of the firm? Does it add Going-Concern Value?

Marketing System Assessment

A review of the firm's marketing strategy and system

Strategic and Tactical Plans

An assessment of marketing planning on individual attorney and firm-level including strategic & financial goals, mission and brand definition, target audience definition, activity plans, and frequencies

  • Strategic and Financial Goals
  • Mission and Brand Definition
  • Target Audience Definition
  • Activity Plans, Frequencies and Schedules


The support system includes all the elements of the firm's marketing system designed to help its members and attorneys engage in marketing activities.

  • Internal Support
  • External Support
  • Software Support


Policies are used as guidelines for the organization and its members to plan and implement their activities.

  • CRM
  • Contact Manager
  • Integrated Web-Based Client Contact Tools

Marketing Performance Assessment

Assessment of the firm's marketing performance with respect to planning and support digital marketing, networking & relationship building

Digital (Inbound) Marketing

This part of the analysis focuses on the firm's online profile. We review the website, Google rankings, blog quality, social media presence and capability to develop content, as well as the lead flow

  • Web Site and Web Presence Assessment
  • Blog
  • Search Engine Review
  • Social Media Effectiveness
  • Content Development Capability

Relationship Building

We distribute and collect survey from attorneys to assess their contact management activities with respect to prospects. clients and referral sources.

  • Organization Participation
  • Event Attendance
  • Client Visits
  • Leads Generated
  • Leads Converted

Marketing Metrics Calculation

Marketing Metrics in the form of cost- and effectiveness- related Key Performance Indicators. Comparing Cost and Payoff allows for us to determine the firm's quantified marketing performance level


Analysis of marketing-related costs

  • Client Acquisition & Retention Cost
  • Time To Payback
  • Marketing Return on Investment


Analysis of pay-off indicators

  • Marketing Originated Client
  • Average Revenue per Client
  • 3 Year - Average New Clients Trend
  • 3 Year Average New Files Trend
  • 3 Year Average Lost Clients Trend
  • 3 Year Referral Source Trend


Client service is an essential part of a healthy law firm. Sometimes, it is difficult to assess the quality of the services provided to clients until it is too late.

Early warning indicators allow for corrective action in near real time, while case handling processes are in progress. Providing law firm managers with easy to understand metrics and data points can mean the difference between keeping and losing a client, between profitability and losing money, and help a law firm make a case for better rates and increased business with a client.

For more information, the attached articles are a good place to start.

KPI: Average Days Files are Open

List of open files with date opened and date closed. Use a simple average and median. Sift out outliers.

KPI: Average Age of Open Files

List of all open files with open date, practice area, and billing attorney. Sift outliers. Might have to sort by practice area if the firm's client mix is diverse. May also need to sort by lawyer.

KPI: Number of Cases Resolved Monthly

A report indicating cases closed by month for the last 3 years.

KPI: Average Age of Closed Files

Need a report that indicates the file open and close date for 3 years of closed files. Create an aging of time to close. Create a relevant range for how cases are closed.

KPI: Caseloads by Attorney

List of assigned cases by responsible lawyer broken out by year for the prior 3 years. Deliverable is by responsible lawyers.

KPI: Average Number of Revenue Generators on a Client (top 10 clients)

List of top 10 clients and who is working the files. List average timekeepers by client. The purpose is to determine if the staffing mix is appropriate.

KPI: Average Revenue Amount By Case Type

Fees received by case type 3 years. The average revenue per year for each case type.


Work Life Timelines

Worklife timelines for all attorneys. Indicates who is nearing retirement and who are the likely replacement lawyers.

Operating Agreement Review

Retirement timing and approach

Mandatory retirement age
Transition plans and timing
Qualifying for a transition plan

inserting these types of policies into an operating agreement before actual retirements begin removes the difficulty of opening a dialogue with a senior partner at what may feel like an arbitrary time. For example, a firm may approach a senior partner about retiring when he is 65, which may offend him if he is planning to work several more years.

Return of Capital

Return of capital timing and amount
Payout of AR and WIP interests, if applicable

The capital a retiring partner may have invested in the law firm typically consists of fixed capital and undistributed earnings. As undistributed earnings have been previously taxed or subject to tax in the current period, most firms pay undistributed earnings on an expedited basis. Depending upon the amount of fixed capital, the payout period can extend for several months or even years.
When the return of capital also includes an amount for a retiring partner's interest in Accounts Receivable and Work in Progress, a valuation process and payment schedule are necessary.

Post Retirement Liability Obligations

Post-retirement liability obligations

Lease and debt guarantee policy upon retirement
Contingent liability agreement (if necessary)

Some obligations, especially those to third parties, may need special handling by the remaining partners. For example, a large bank loan that is personally guaranteed by all equity partners will require a release of guarantee for the retiring partner. Loan agreements that require a retiring partner's net worth as collateral are particularly challenging.

Post Retirement Compensation

Post-retirement compensation options
Retiring partner buy-out provisions
Contingent case policy
Post-retirement practice a law
Most law firm compensation systems are designed to pay partners contemporaneously, which results in little residual value accruing to retiring partners except for transitioned client relationships. While retired partner buyouts are difficult in any circumstance, it is particularly difficult to justify post-retirement payments to partners who were not able to transition clients to other partners in the firm.

Orderly transfer of equity and capital requirements

New partner equity policy
Lateral partner equity policy
Capital requirements tied to ownership

An orderly process for transferring equity interests among members is beneficial and supportive of firm longevity and growth. When ownership impacts compensation, transferring equity among members is more difficult. Concentrated ownership interests can make admitting new partners harder.

Supporting Policies

Compensation policies
Partnership admission policies

Many firms include their compensation system as an exhibit to their operating agreements. We recommend including definitions and examples of formula based systems. Thoroughly documenting subjective pay systems where possible is also recommended.

Documenting compensation policies and including them in the firm’s operating agreement can promote stability and maximum predictability.


Results Explanation

Deliverable: Financial Health of the Firm

Deliverable: Attorney and Other Revenue Generator Performance Analysis

Deliverable: Attorney Planning and Performance Management Assessment

Deliverable: Strategic Software Application Assessment

Deliverable: Marketing System Assessment

Tools: Marketing Support Apps.

Process: Is there evidence of a planning process? If so, is it adequate? Is there a budgeting process?

People: Support resources, activity measurement, the things people do - is the execution adequate - activity benchmarks

Deliverable: Operating Efficiency Overview

1-page presentation of client service metrics. Identify potential areas of improvement and the benefit economically to the firm and client of speeding up or slowing down the process.

Deliverable: Transition Readiness

Checklist presentation of the key transition areas with comments. Perhaps a graphical presentation

Priority Recommendation Outline

Top two or three issues from each area- ordered by most important - prepared to discuss how we would address the issues.

Next Steps Recommendation

How we would address the issues and what we recommend happens in succession after the report is issued.

Q&A Follow Up