Law firms are famous for the high volume of paperwork they must manage. Additionally, attorneys must keep track of their time for billing purposes, which is challenging when they have multiple clients or are working on contingency.
Legal practice management software streamlines the lawyer’s workflow with a centralized database, fast and flexible searching, calendaring, task tracking, phone messaging, mobile access and app integration and more. It helps enhance firm efficiency and prevents attorneys from being buried under physical files. Moreover, it helps prevent calendar and deadline-related errors, which are responsible for most legal malpractice claims (according to The American Bar Association).
Most practice management systems offer the same applications for all practice areas, but provide some degree of customization. And while many providers only offer their applications as a package, some are sold on a best-of-breed or “stand-alone” basis (e.g., time and billing systems). This guide provides an overview of legal practice management software to help you research and narrow down the best option for your firm.
Here’s what we’ll cover:
Common Features of Legal Practice Management Software
What Type of Buyer Are You?
How Is It Priced?
Benefits and Potential Issues
The Best Tactics for Evaluating Software
Market Trends to Understand
Recent Events You Should Know About
|Case management||Offers a centralized database, fast and flexible searching, task tracking and management, phone messaging and checks for conflicts of interest and statute of limitations. Organizes the process of case handling and management from beginning to end, thus saving time and money.|
|Contact management/legal CRM||Tracks, logs and stores details about phone calls and emails, and gives callback reminders. Provides you the tools needed to keep in touch through scheduled phone calls, correspondence and meetings. Adds automation to schedule meetings, write letters and emails, and make phone calls—all designed to cultivate your role as a trusted advisor.|
|Document management||Drafts documents and links to word processing programs. Streamlines your document management process and decreases the time and energy required to find essential documents.|
|Document assembly||Efficiently creates legal documents from automated templates that encompass simple forms and letters to complex legal documents. Integrates with programs such as Dropbox and Evernote, and provides case and matter tagging. Reduces the time it takes to create drafts of document.|
|Calendaring and docketing||Allows you to view tasks, deadlines, appointments and meetings by day, week, month or year. Calculates calendar dates, schedules appointments and meetings. Enables you to automatically schedule dates in accordance with court rules relevant to the case, and submit calendar requests to the docketing department who can quickly calendar these requests without many manual steps.|
|Time tracking & billing||Records billable time on an hourly, contingent or transactional basis. Links to time, billing and accounting programs, and generates client invoices. Improves workflows to increase your billing speed and improve cash flow, potentially leading to better client communication, faster billing and decreased administration costs.|
|Accounting||Manages billing, receivables, trust accounts and payroll, and creates financial reports. Helps you organize, track and accurately report your financial transactions.|
Prior to purchasing software for your legal practice, it’s important to understand your organizational needs and how a practice management solution can help meet those requirements.
Solo or small practice with 2-5 employees. The majority of U.S. law firms have fewer than five employees, yet they’re often in need of the same suite of applications that benefit larger firms. Small practices we’ve spoken with have cited the following as reasons they are evaluating practice management software for the first time, or for replacing an existing system:
Best-of-breed buyers. As mentioned, most firms will need an integrated suite of applications. However, some providers do sell stand-alone options, which is especially true for time tracking, billing and accounting systems. Many buyers we’ve spoken with who seek these applications had been using pen and paper or off-the-shelf options such as Outlook to manage their needs. Reasons they decided to switch to practice management software include:
Cloud-based legal practice management software is typically priced on a per-lawyer, per-month basis, with systems starting at about $50-$70 per user, per month. Some vendors will provide discounts if you pay annually instead of monthly.
On-premise software, on the other hand, is most often priced according to the number of perpetual licenses required. These fees are typically paid upfront for the right to use the software in perpetuity (as opposed to paying a monthly or annual subscription). Some vendors, such as HoudiniEsq, offer their software for free to solo attorneys.
Regardless of whether the software uses a perpetual license or subscription pricing model, many vendors will offer packages with varying levels of functionality. In these cases, the price of the system typically increases with the breadth and depth of features offered.
Most often, basic software packages are best suited for solo practices, or very small groups, while “Pro” versions are better for larger organizations. This is because more expensive software might include features that are only relevant to larger practices (e.g., batch billing and team collaboration).
Legal practices that adopt the right types of software may realize many benefits, such as:
Law firms that fail to realize some of these core benefits might do so because they:
Reviewing legal management software can be overwhelming. There are literally dozens of options to choose from, each offering potentially very different features. The system you choose will depend on your practice’s unique needs. So, how do you make sure you choose the right system?
We recently surveyed hundreds of real software buyers to determine which tactics are most effective for evaluating software. From this analysis, we discovered that “checking vendor references” (meaning feedback from real customers) and having an attorney review your license or subscription agreement are the two best tactics for evaluating software. Additionally, any tactics listed in the green corner of the quadrant below were deemed highly effective.
Quadrant indicating where selection tactics fall on the “impact” and “satisfaction” spectrum
To determine which tactics were considered “most effective,” each was evaluated against two metrics:
Y-axis: How much the tactic impacted the outcome of the project, meaning whether people in the sample who applied it experienced a different outcome than those who didn’t.
X-axis: The likelihood of being highly satisfied with your software selection, based on the percent of people in our sample who applied the tactic and rated satisfaction a “9” or “10” on a 10-point scale.
Our hope is that adhering to the selection methods in the “most effective” quadrant (while avoiding those in the least effective quadrant) will help buyers save time and ensure they choose the right product for their needs.
Software-as-a-Service (SaaS). Cloud practice management software gives your staff and clients the ability to access sensitive data from any computer with an Internet connection. Based on our conversations with buyers and vendors, most purchasers feel confident with cloud security—this makes sense because cloud providers’ data centers are often more secure than those of individual practices.
Multiple state bar associations have issued formal ethics opinions on the security of cloud computing, saying it adheres to attorneys’ confidentiality-related obligations. However, it’s important that you ask what security measures are used by the cloud service providers you’re considering, as well as where and how frequently the information stored is backed-up. Also, how much bandwidth does your practice need to be comfortable? Will cloud options be able to handle your data load, or should you choose an on-premise solution instead?
Mobile computing. Attorneys are often on the go and accessing systems from other offices, home and mobile devices. Tablet (e.g., iPad) and smartphone application integration is increasingly common.
Mobile view of CosmoLex
A significant benefit of many legal practice management software options is the flexibility you have to securely access your client and case information while commuting or waiting in court, thus allowing you to maximize each moment. Therefore, when researching and evaluating legal practice management software, you should consider if mobile support is a requirement and ask vendors about what kind of options they have.
Do they have native applications for iPhone and Android devices (usually the preferred access method)? Or, do they simply provide access through a mobile Web browser?
And what kind of security do they have in place? Do their mobile apps allow you to control who at your office gets access to the system?
CosmoLex integrates with LawPay, adds credit card processing. CosmoLex announced in September of 2015 that it would be adding credit card processing to their platform through an integration with LawPay. CosmoLex customers will now be able to accept credit card and online payments for trust retainers, ongoing invoice payments and advance fee payments.
MyCase adds e-payment feature. In October 2015, MyCase announced a new payments feature, allowing firms to accept e-check payments directly from clients’ bank accounts as either an e-check or Automated Clearing House (ACH) credit transfer. This new feature rounds out MyCase’s robust billing and invoicing capabilities, which already included credit card processing.
LexisNexis acquires Lex Machina, Inc. In November 2015, LexisNexis announced the acquisition of legal analytics provider Lex Machina, Inc. Legal analytics software mines, tags and sorts Federal Court documents and dockets, enabling lawyers to better predict the outcomes for legal strategies. This merger further solidifies LexisNexis as a pivotal legal industry leader, not just as a provider of software solutions but also for the future of legal data analytics.
We're able to offer this service to buyers for free, because software vendors pay us on a "pay-per-lead" basis. Buyers get great advice. Sellers get great referrals.