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Show Me The Math: The importance of cost estimates when engaging a law firm (eBook)


ISBN13: 9781787426214
Published: June 2020
Publisher: Ark Group
Country of Publication: UK
Format: eBook (ePub)
Price: £149.00
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Show me the math is the first book of its kind entirely dedicated to understanding all of the strategic benefits, importance, and the value of cost estimates for corporate clients as well as law firms. Leveraging a 20-year career in corporate legal operations, Richard Brzakala reviews a plethora of topics on cost estimates and presents an in-depth analysis of the cost estimate framework and what clients (and firms) see as the most valuable components of a cost estimate strategy. The book also tackles operational and implementation topics, the dos and don'ts of successful implementation, and a special focus on overcoming challenges and meeting client expectations. This is a comprehensive insider's view of what corporate clients expect from their panel firms and a playbook on how cost estimates can improve a firm’s market competitiveness in an increasingly homogenized and challenging legal marketplace.

Drawing on nearly two decades of legal operations experience, servicing multiple clients and hundreds of law firms in dozens of countries, Richard has compiled his observations on how cost estimates can benefit corporate clients, legal professionals, finance and marketing experts, law students, alternative legal providers, and procurement and pricing specialists, and assist them in managing their matters, costs, and overall relationships.

Subjects:
Legal Practice Management, eBooks
Contents:
Chapter one: The benefits of cost estimates
Background
The increased popularity of cost estimates
What do clients look for in a cost estimate?
What don’t clients want to see in a cost estimate?
How clients are empowered by cost estimates
The benefits of cost estimates to a law firm
Chapter two: The mechanics of cost estimates
The continued utilization of the hourly rate billing model
Cost estimates based on task-based billing models
Utilizing dollar ranges in cost estimate proposals
Buyer beware – stay away from commercial (street) rates in cost estimates
Leveraging historical data and work
Highlighting cost savings and efficiency in a cost estimate
The importance of understanding variances and assumptions
Calculating the variance cushion
Leveraging law firm resources to develop cost estimates
Calculating the staffing utilization ratio
Challenging the traditional legal model
Monitoring staff utilization ratio in cost estimates
Measuring and monitoring work in progress (WIP) ratio
The impact of changing resources on a cost estimate
The benefits of using Alternative Fee Arrangements in a cost estimate
Third party vendor costs
How to treat disbursements in a cost estimate
The importance of a communication strategy
The criticality of properly defining and understanding scope
The importance of communication during the cost estimate process
Defining scope
The law firm’s responsibility in defining scope
The unpredictability of “scope creep” and accounting for variances
Dealing with cost estimate overages
The blame game – dealing with law firm fault bias
Avoiding cost overages that impact a cost estimate
How law firms should communicate overages to clients
Dealing with multiple clients and instruction points on a cost
estimate
Chapter three: Operational challenges
Operationalizing a successful cost estimate strategy
Case study – US insurance company
Working through differences on a cost estimate
Educating lawyers on the business of law
Leveraging Legal Operation (Legal Ops) specialists
Why do in-house counsel fail at cost estimates?
Top ten list – what law firms dislike most about cost estimates
The resistance to utilize cost estimates
Beware of law firm caveats and disclaimers
Chapter four: Value and cost estimates
How does value factor into a cost estimate?
Measuring value using Value Indicators
Value Indicators
Law firm Value Indicator calculator
What happens in the absence of value?
Law firms need to stand their ground – clients are not always right
Unlocking the value of cost estimates
What type of insight or strategic advantage can cost estimate data give clients?
How clients track the success of a cost estimate
Tracking the success of cost estimates
How firms should leverage cost estimate data for the benefit of their clients
How can a firm win work on the basis of a cost estimate?
When are cost estimates a waste of time and not necessary?
Who cares about the math, show me the value!
Is there any room for an “instinctive approach” on a cost estimate?
Chapter five: Other considerations
How third party pass through hourly rates impact a cost estimate
Treating cost estimates like a request for proposal (RFP) bid
The importance of trust in cost estimates
Challenging a law firm’s cost estimate
How to get a firm to reduce its cost estimate
What to do when a cost estimate fails
Billing for a cost estimate
What is the future for cost estimates?