[T]he firm has been tracking data on the numbers behind its matters since the mid-1980s. It can run reports on what matters were the most and least profitable in that month or that quarter, whether realization rates were a problem and whether the right people were staffed on the matter, he said. When that new matter comes in, Sheeran and his team go back to the history of that client's matters and look at the average time spent on a type of case. If it is a new client, he said, the firm needs a lot more information upfront and there are often more carveouts in the agreement to protect against unexpected issues.When a client chooses to go with an AFA, Sheeran will work with the lead attorney on the case to staff it appropriately and the firm's finance department will run financial analyses on the matter as it moves forward. While Sheeran stresses in the article that project management is critical to the success of AFAs, Duane Morris does not have a firm-wide project management system that its attorneys are expect to use (although it does use such a system for its litigation support department [4] ). For many of the firm's lawyers the "entire project management process is really left up to the finance side," but some "practice group leaders and individual partners whose clients typically ask for alternative fee arrangements" have begun creating spreadsheets on their own to track [these cases] and have even brought clients into the process."
The key to being able to track the profitability of matters, Sheeran said, is to continue to track work by the hour as well. "That's where the fallacy of 'the billable hour is about to die' really comes home to roost," he said. Project management is based on managerial or cost accounting and the hours have to be properly tracked to know whether an alternative arrangement was profitable, he said. The key in all of this is trust and open and honest communication between the attorney and client, Sheeran said.While I appreciate his point, part of me dies inside when I read this. Must legal project management be tied to billable hour? Or can project management help attorneys escape from recording everything we do in six-minute increments? Billable-hour pressure and the relentless time-keeping it requires is a (the?) primary source of attorney dissatisfaction, attrition, and unethical behavior.[5] If legal project management entrenches and depends upon the billable hour, I can't imagine attorneys embracing it and can see why they'd leave LPM to the finance department.
[1] Gina Passarella, Tracking Numbers Key to Duane Morris' Project Management, The Legal Intelligencer, Apr. 20, 2010, http://www.law.com/jsp/article.jsp?id=1202448304374&Tracking_Numbers_Key_to_Duane_Morris_Project_Management (last visited Apr. 21, 2010.
[2] Paul C. Easton, Legal Project Management is Key to Fixed-fee Billing, Legal Project Management, Aug. 31, 2009, http://legalprojectmanagement.info/2009/08/legal-project-management-is-key-to-fixed-fee-billing.html (last visited Apr. 21, 2010).
[3] Paul C. Easton, Duane Morris Implements iFramework for Litigation Support Project Management, Legal Project Management, Dec. 5, 2009, http://legalprojectmanagement.info/2009/12/duane-morris-implements-iframework-for-litigation-support-project-management.html (last visited Apr. 21, 2010).
[4] See id.
[5] See, e.g., Susan Saab Fortney, An Empirical Study of Associate Satisfaction, Law Firm Culture, and the Effects of Billable Hour Requirements (Part One*), 64 Texas Bar Journal 1060, Dec. 2001, available at http://www.texasbar.com/Template.cfm?Section=Home&Template=/ContentManagement/ContentDisplay.cfm&ContentID=7098 (last visited Apr. 21, 2010); Susan Saab Fortney, Soul for Sale: An Empirical Study of Associate Satisfaction, Law Firm Culture, and the Effects of Billable Hour Requirements, 69 U.M.K.C. L. Rev. 239 (2000); Niki Kuckes, The Hourse: The Short, Unhappy History of How Lawyers Bill Their Clients., Legal Affairs, Sep.-Oct. 2002, http://www.legalaffairs.org/issues/September-October-2002/review_kuckes_sepoct2002.msp (last visited Apr. 21, 2010).
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