BigHand case study: Foot Anstey leverages intelligent decision making to drive a performance and profit-led culture
Culture transformation: Foot Anstey drives pricing, profit and productivity.
Overview
Foot Anstey is one of the UK’s top 100 law firms, with over 50 partners and 500 staff – and one of the largest firms outside London. The firm, which has been in existence for over 100 years, is firmly rooted in the South West of England, with offices in Bristol, Exeter, Taunton and Southampton.
The law firm prides itself on offering high-quality services at a fraction of the cost of London based firms, however, with pressure on fees becoming even greater, and growing numbers of clients pushing for a fixed fee model, it has become imperative for all fee earners to have accurate and up to date performance, efficiency and financial insight.
Legal Knowledge
For Foot Anstey, a strategic overhaul of the Practice Management system in 2015 prompted a review of the way in which key strategic performance and finance information was provided to the business. As Neil Demuth, Executive Director Finance Operations, explains, “We recognised the need to improve our reporting structure to provide partners and lawyers with readily available information to help them better understand how they are performing, reinforcing a corporate culture of financial control to meet both our own and our clients’ business needs.”
The new Practice Management system included a reporting solution, but the firm decided it was not fit for purpose: “It didn’t feel intuitive for the end user,” he says. Having assessed the market, the firm opted for BigHand’s Quantum Financial Data Warehouse, not only for the intuitive user experience and self-service information access it provides but also the company’s deep understanding and experience of the legal marketplace.
As Demuth confirms, “While the majority of software companies can offer good technical expertise, the guys at BigHand also have legal expertise and experience; they have worked for law firms, they have been legal management accountants; they understand the market, culture and terminology. We felt a great rapport.”
Tailored Dashboards
BigHand also took time to understand the specifics of the Foot Anstey business, and worked with Foot Anstey to ensure the highly adaptable, and data source agnostic BigHand Quantum data warehouse would deliver the precise dashboards required to meet the firm’s specific Key Performance Indicators (KPI).
Leveraging the data from the Practice Management system, Foot Anstey has two dashboards – one customised for the firm’s 56 partners, providing an overview of all work under their remit, and one for the remaining 200 lawyers, providing each lawyer with granular performance insight. The dashboard is available online, via the company’s intranet, and is customised in the corporate colours.
The dashboards address the three primary KPIs identified by the business, namely: Time recording, by day, week and month; Recovery rate – the hours converted into fees; and Efficiency.
While Foot Anstey had provided some limited performance and financial information to fee earners in the past, with BigHand Quantum the information is now refreshed routinely throughout the day, ensuring all fee earners have complete confidence in the performance information through its intuitive, drill down dashboard model.
Profit Insight
Foot Anstey was rapidly able to start leveraging this information to drive business benefits – not least in gaining a far better understanding of profitability by client, matter, sector and work type. “Our business leaders now have a powerful tool to help understand in detail the profitability of the work we are delivering,” Demuth confirms.
The ability to confidently look beyond the headline turnover by client, for example, into the overall cost of managing that relationship to understand profitability has enabled Foot Anstey to refine its business model and pricing. Demuth works closely with the partners to delve down through the figures, using identified areas of particularly strong or weak profit, to understand underlying business practices, determine how good performance could be replicated elsewhere, and less good avoided in the future.
He confirms, “The BigHand Quantum dashboard is a really good tool that helps partners step back and think about how Foot Anstey could be best placed for future work.”
Assessing Opportunities
The following year, in September 2016, Foot Anstey also deployed BigHand Evaluate, a matter budgeting and pricing tool. BigHand Evaluate enables the firm to build on its profitability insight and new thinking regarding pricing by providing a very clear view of potential profit on each piece of work before an instruction is even accepted. For example, if a client is looking for a fixed fee of £10,000, the firm can determine the likely break down of work required – by partner, senior associate, junior and trainee – and BigHand Evaluate will automatically calculate the likely profit contribution based on the cost rate of each individual.
“This insight has ensured that Foot Anstey has avoided engagements that would have been loss leaders while also enabling the firm to sharpen prices to ensure we are generating the correct contribution from each piece of work.” Demuth continues, “The firm’s client development team is heavily involved, especially when being asked to pitch for work at discounted or blended partner rates, in evaluating the impact on profitability of various pricing models.” He confirms “It effectively enables us to undertake ‘What If’ scenarios to determine whether or not a piece of work would be commercially right for the firm at a set fee or rate.”
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