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Big Data may mean Big Insights.

At least, that’s one major takeaway I got from the Legal Trends Report released by Clio late last year.

Yesterday, I shared my December editor’s column from Arizona Attorney Magazine in which I discussed the report and a few of its findings. But I also had promised to write about the part of the report that wasn’t so much about law practice, but about the power of data to make positive change.

Today, let me get back to that.

Here is the pertinent part of my column I’ll extrapolate on today:

“First—and maybe less interesting to you—is the newfound power of data to provide insight. I’ll write more about this in the future (probably in my blog https://azatty.wordpress.com/), but it’s incredible that via our own real-time software choices, companies like Clio can assess the state of law practice—all within the agreed-upon terms of use. They can see, moment by moment, how many new matters are opened, how many invoices are generated, how many remain unpaid. Does this spell the end of surveys based on self-reported data? We’ll see.”

Before I dive in, here again is a link to the complete report. Read it yourself and let me know what you think.

Clio logo

Data + lawyering? Yes, please, say Clio.

Besides the bullet points I mentioned in my column, here are a few more macro-level insights by Clio:

  • The total 2015 realization rate (actual hours billed as a proportion of actual billable hours worked) came in at 81 percent, but this differed noticeably by practice area and by state.
  • The total 2015 collection rate (actual revenue proportional to hours billed) was 86 percent.

So let’s jump in, shall we, and start with Clio’s premise, regarding the dearth of practice decisions driven by data.

Essentially, they’re saying, in the 4,000-year history of the legal profession, lawyers, firm owners, and decision makers have suffered from a scarcity of industry data. Law firms have had only sparse resources to find the business insights required to run a viable practice.

I know, dramatic, right? In the very first line of their executive summary, they’ve got me with a compelling narrative. Plus, they have subtly conjoined me with every great lawyer, from Hammurabi, to Abe Lincoln, to Sandra Day O’Connor. Those folks—and me. We’ve all suffered the same law practice pains that arise from insufficient reliable evidence. But we’ll solve it together.

OK, I joke, but there’s something to their point. The mass of data that we rely on do come from (as Clio says) self-reported data and often small sample sizes. And is there a way to know if the data we rely on REALLY came from firms of a size like our own firm? Unlikely.

hammurabi

Hammurabi had a great Code, the best, really. But who knows what he could have achieved with better data?!

But the advent of Big Data and data aggregators has changed all that. Now companies like Clio—and others you interact with every day—have access to your actual choices and interactions with their products. They can see, moment by moment, how many new matters are opened, and how many invoices are generated, and how many remain unpaid.

Here is where I must note that Clio (like all reputable companies) is using all of our online decision-making anonymously, stripped of identifying data. But when they take this massive batch of anonymous data, and analyze it, a remarkable picture of us as a profession emerges. The world is changed—for the better.

So that was a bit of a wake-up call.

But I leave you today again, once again, with their visceral image of your practice as a funnel.

Any of us who practice or have practiced law understand that there is a flow to the work, and that we need matters to begin, end, and get paid for—and hopefully all those things overlap in multiple matters so there is actual cash flow. But picturing it like a funnel invites a disturbingly accurate assessment of where we all stand.

Because we are all busy, I invite you to turn to the report’s page 35. Or, if you’re really busy, I’ll type it for you:

Funnel Cloud? The Devastating Conclusion

Out of an eight-hour workday, the average firm collects payment on only 1.4 hours of billable time. These unit economics would be devastating to almost any industry, and they help explain why, despite charging an average $232 per billable hour, the average small-to-mid-sized firm struggles to make ends meet.

I hope you weren’t standing up when you read that.

Once again, here is a link to the complete report.

Enjoy.

Clio logo

Data + lawyering? Yes, say Clio.

Was it way back in December that I wrote about the new Clio law practice report? And promised you more?

Sorry about that.

Yes, it was in the December issue of Arizona Attorney Magazine that I chatted about the Clio Legal Trends Report. You can read the column here.

Because I’m super-helpful, I’ve pasted in below what I wrote, so you don’t even have to click.

And tomorrow, I’ll offer some more thoughts on what we can learn from the Clio report—and reports like it. Here’s my column (plus an image):

We thought we understood the way the world worked—and then the Cubs won the World Series.

I suppose it’s good we’re still capable of being surprised. It probably says something nice about our capacity for joy. Or something.

Of course, surprises are not always happy, which occurred to me as I read a new report on law practice trends.

Via their “Legal Trends Report,” the people at Clio—the cloud-based practice management people—want you to know two things about your law practice.

First, your practice is a funnel—one that may be malfunctioning.

And second, consider using data—actual facts based in reality—to drive your practice decisions.

Clio will likely say I’m oversimplifying a vast array of takeaways from the report released in late October. But those takeaways—and the underlying facts—are pretty stunning.

dec-2016-editors-column-on-clio-report

Here is a link to the complete report. Read it yourself and let me know what you think.

And here are two insights compiled by Clio:

  • The average rate billed by lawyers across the United States is $232 per hour.
  • The total utilization rate (billable hours as a proportion of hours available in a working day) for lawyers in 2015 was just 28 percent. For solo lawyers, that number drops to just 22 percent.

What makes this noteworthy?

First—and maybe less interesting to you—is the newfound power of data to provide insight. I’ll write more about this in the future (probably in my blog https://azatty.wordpress.com/), but it’s incredible that via our own real-time software choices, companies like Clio can assess the state of law practice—all within the agreed-upon terms of use.

They can see, moment by moment, how many new matters are opened, how many invoices are generated, how many remain unpaid.

Does this spell the end of surveys based on self-reported data? We’ll see.

The second takeaway is related to the unprofitability of many attorneys’ law practices. When we look at just two of Clio’s many charts—Arizona’s average hourly rate, and its (gulp) average collection rate, the situation appears dire.

There’s definitely more to the picture. But as we head into 2017, we will seek ways to tell the true story of law practice challenges.

Until then: Go Cubs.

A week and a half. That’s all that’s left before our drop-dead deadline for the Arizona Attorney Magazine Creative Arts Competition. That’s our annual endeavor we’ve been doing for almost 15 years now. And we need your submissions sent to the contest email by the end of Friday, January 13, 2017. You can see one of our great call-for-submissions ads below.

arts-competition-ad-2017

We welcome entries in the following categories:

  • Fiction
  • Nonfiction
  • Poetry
  • Humor
  • Music
  • Visual Arts: Painting, Photography, Drawing, Sculpture

We will publish the winners in Spring 2017.

Send submissions to ArtsContest@azbar.org and queries to the editor at arizona.attorney@azbar.org.

And do you like reading rules? We’ve got ’em; click here.

For inspiration, here is last year’s issue with the 2016 winners.

Remember: The submission deadline is January 13, 2017.

The Creative Arts Competition deadline approaches!

Read this most excellent piece on professionalism, reading, and the ethical challenges we face when we see our homeless neighbors.

Bar View

Flowers in My Hair
By Kevin Ryan, Esq.

Scott McKenzie once advised us (OMG, I’m dating myself now!): “If you go to San Francisco, be sure to wear flowers in your hair.” OK, so I ignored McKenzie’s sage advice this trip – it is not, after all, the summer of love. And besides, I wasn’t going to the City by the Bay in order to wander the streets of the Haight, smoke a little weed, and sit in Golden Gate Park (or Fillmore West) to listen to the Airplane, the Dead, and Quicksilver. I didn’t even plan to leave my heart there. Times have changed.

I went to San Francisco to attend the annual meeting of the National Association of Bar Executives. I find these conferences to be exceptionally valuable: they keep me fresh, they inspire me, and they provide me a chance to mingle and…

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Some timely questions are posed here by a colleague in New York State, Kevin Ryan. What are your thoughts on the recent candid comments by Justice Ruth Bader Ginsburg? Appropriate? Something less than that?

Bar View

By Kevin Ryan, Esq.

Three times in the past week Justice Ruth Bader Ginsburg has offered strong opinions on the presidential race and her views of Donald Trump as a presidential hopeful. “I can’t imagine what the country would be with Donald Trump as our president,” she told an interviewer from The New York Times. Previously, in an interview with The Associated Press, she said she didn’t “want to think about the possibility [of a Trump victory],” because then “everything would be up for grabs.” She has labeled Mr. Trump as an inconsistent “faker” who “says whatever comes into his head,” noting “he really has an ego.”

Now, no matter what one thinks about Mr. Trump or his candidacy, such comments from a sitting Supreme Court justice seem to cross the line. Historically, justices on the Court have shied away from making political statements – and they certainly have…

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Before National #TypewriterDay ends, I share an item from last year …

AZ Attorney

A Contessa never looked so sweet (or clacked so loudly). typewriter A Contessa never looked so sweet (or clacked so loudly).

Who doesn’t love a typewriter?

Well, the world, apparently. As a whole, things may look bad for this most useful of tools.

But as individuals, many of us maintain a soft spot in our hearts for the clatter of the lettered keys. For in a digital world, it’s a blast to recall how much we once actually used our digits in a tactile way.

I got to thinking about that in February when I read a terrific essay titled “The Last of the Typewriter Men.” It tells the tale of New Yorker Paul Schweitzer and his everyday battle to help ever-older typewriters to function well.

On this Change of Venue Friday, I wonder if you, like me, still have a typewriter around the home or office.

I still hear from folks that an IBM Selectric is kept…

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Craig Morris, U.S. Patent & Trademark Office

Craig Morris, U.S. Patent & Trademark Office

Learning how the U.S. trademark application system works will be made easier this Wednesday, October 21, when U.S. Patent Trademark Office Managing Attorney Craig Morris appears at the State Library of Arizona in the historic state capitol.

As the state’s division of Library, Archives and Public Records describes it, Morris’s talk will include:

  • Live demonstration of the USPTO’s online application system
  • Help resources within the application
  • How to avoid common mistakes

There is no cost to attend the presentation, but seats are limited. Reserve your seat here.

The event will be held at the State Library of Arizona, Con Cronin Commons Meeting Room, 1700 W. Washington St., Phoenix, at 3:00 pm, Oct. 21.

For more information, contact the State Library of Arizona at research@azlibrary.gov or 602-926-3870.

And here is more information about speaker Craig Morris:

“Craig Morris works within the Office of the Commissioner for Trademarks in the United States Patent and Trademark Office (USPTO), Alexandria, Va. Currently, he is the Managing Attorney for Trademark Educational Outreach, spearheading the effort for increased USPTO educational activities in the area of trademark fundamentals. For 14 years prior, he was the Managing Attorney for the Trademark Electronic Application System, focusing on making the Trademark Operation a total e-government environment. Mr. Morris has been with the USPTO since 1983, previously serving as a Law Office Examining Attorney, Senior Attorney, and Managing Attorney.”

uspto_seal US Patent and Trademark Office

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