Punching Above Their Weight: “We’re hired to make a difference. We want to focus on the client and change their... Best Books for Solo Entrepreneurial Lawyers in 2018: Reading a great book is a real joy. Reading is also an effective way for solo lawyers to... What Makes Lawyers Happy? It’s Not What You Think!: Happy lawyer—sounds like an oxymoron, right? I can’t think of many of my colleagues... Make This the Year You Take Control Of Your Time!: A lot of lawyers are extremely challenged about operating in crisis mode and ending many... A Strategic Approach To Legal Business Development: Many of us treat legal business development the same way we do bathing suit season—we... 17 WAYS TO ADD VALUE TO YOUR CLIENT RELATIONSHIPS: Legal marketers talk a lot about value. We talk about providing value, being of value,... 4 Client Intake Best Practices For Law Firms: At many law firms, client intake is a disjointed process of back and forth calls and... Community News – April 2018: Mark P. Robinson, Jr., Shareholder and Founder of Robinson Calcagnie, Inc, has been named... There’s always a plan: For People, Businesses and Attorneys withClients Facing Hard-To-Resolve Debt, Gregory... How to Become a Motivational Leader at Your Firm: A leader should not only guide others to ensure great professional success, but also...
Executive Presentations-468x60-1

Death of the Billable Hour: A Eulogy

Last month, I participated on a panel at the 2016 Futures Conference. My assigned task was to discuss whether the billable hour would finally be dead by 2026. That got me thinking about the future event that would mark the passing of the billable hour as we know it. Would there be a final hourly invoice, billed and paid by a client, signifying the system's demise? Would there be a funeral for the billable hour? And if so, who would be there to eulogize it and what would that sound like?

The eulogy might sound something like this:

We are gathered here today to honor and pay our respects to William "Able" Hour, or "Bill" as many of us came to know him.
Bill Hour had a long career, providing many with joy and others with hand-wringing over the intended and unintended negative consequences he created. Bill would regularly and effortlessly put the client’s interests in conflict with those of lawyers.
He was very adept at hiding the true cost of a project and shunned providing clients with any level of predictability.
Bill Hour would take great pride in promoting redundancy and over-lawyering.
His knack for having clients pick up the tab for process inefficiencies, bill padding and training was unmatched.
I recall a time when Bill and I were returning from a client’s office. We had just landed a very important project, and I asked Bill if we should develop a budget, project plan or timeline that would identify key milestones. Bill assured me, with a wink and a smile, there was no need as he “had it covered.”

ALAS, THE DEATH OF THE BILLABLE HOUR IS NOT TO BE
I believe the billable hour will still be alive in 2026. How so? A few drivers are keeping the billable hour alive, including:

  • An unwillingness by some law firms (or partners within firms) to offer pricing alternatives.
  • A law firm dependence on billable hour targets.
  • Cost accounting that typically drives law firm profitability calculations.
  • Clients that are still more comfortable with billable hour arrangements.
  • Clients addicted to the billable hour data they mine internally or receive from their e-billing vendors, allowing for simple quantitative comparisons.
  • Sophisticated or complex legal work that warrants an hourly billing arrangement.

But there are some changes we should see over the next 10 years:

  • An increase in legal services and products as subscriptions.
  • Less emphasis on billable hour targets at firms.
  • Law firm business models that don't rely on the billable hour to calculate profitability.
  • A growing number of clients that favor outcome or valuebased metrics and rely less on some quantitative metrics like hourly billing rates.
Digg This
Reddit This
Stumble Now!
Buzz This
Vote on DZone
Share on Facebook
Bookmark this on Delicious
Kick It on DotNetKicks.com
Shout it
Share on LinkedIn
Bookmark this on Technorati
Post on Twitter
Google Buzz (aka. Google Reader)
PDF24 Tools    Send article as PDF   

Filed Under: Featured StoriesMarketing

About the Author:

RSSComments (0)

Trackback URL

Leave a Reply

  • Polls
    Sorry, there are no polls available at the moment.