Integrating Tech into Pricing - How are we doing?
Welcome to this month's article of Let’s Be Frank, a monthly newsletter series hosted on LinkedIn and authored by our founder Digby. If you are interested in following along pop over to the Let’s Be Frank LinkedIn page here and hit the subscribe button to have these articles sent straight to your inbox.
Digby Leigh & Co. eliminated hourly billing in September, 2020. In late October, 2021, we decided to streamline our new approach to pricing with technology. We did this through AltFee.
Going back to the start, in September, 2020, we introduced our new system to manage pricing, which we called Frank Fee. This was a manual system, and was created by breaking our work into about 40 different project types. We then created relevant factors/considerations for each project type. When we priced a new matter, we would go into our manual, find the correct project type, create a list of the applicable factors and then add up the total of the base fee and the factors. This worked fairly well during the first year, as we spent a lot of time getting used to agreed upon pricing upfront.
As soon as we launched our manual system, my two sons and I started to build a tech-based system to replace it. It took a full year to get AltFee to a stage where it could be piloted at our firm.
In our first month of AltFee, we only priced a handful of projects using the technology. Adoption of any new system always takes some time, but it wasn’t long before we transitioned to where we are now, pricing 60+ new matters every month.
Here are our key learnings:
Using AltFee has made our law firm more profitable. Our billing realization rates have increased significantly since October 2021.
Team members have increased confidence when it comes to pricing - less experienced team members are better equipped to take the lead on pricing client projects.
Everyone working on a file is able to collaborate asynchronously, which in today’s world of remote working, is imperative.
Using technology results in more consistent pricing for clients.
As our COO puts it, “systems and efficiencies are priorities for the firm and AltFee’s software achieves both.”
Technology helps us to “work on [our] business, not in it” as Michael Gerber would say. Since integrating tech into pricing, our place is now a better place to work.
It would be great to hear from any of you on your pricing experiences.
Until next time,
