Running a successful law firm is about more than winning cases or driving the best legal outcomes. It’s also about keeping your business operating smoothly. You need to know how your firm is performing at all levels, from the number of cases closed each month to the happiness of your clients.

Key performance indicators (KPIs) help you measure successes, highlight areas that need attention, and make informed decisions to boost your firm's performance and profitability. But with so many metrics available now, how do you know which are most important?

At Litify, we recommend prioritizing four main areas: operations, business development and intakes, business efficiency and profitability, and client satisfaction. These KPIs can guide your firm toward even greater success.

Plus, our robust reports and dynamic dashboards give you real-time access to this kind of performance data all in one place. From tracking hours and expenses to monitoring client satisfaction, our platform provides the tools to visualize your KPIs and make decisions that align with your firm's goals.

1. Law Firm Operations

Let’s start with the nuts and bolts of your law firm: the day-to-day operations. To get a clear picture of how well your firm functions, you can focus on the following:

Monitoring staff productivity

Are your attorneys meeting their deadlines? Are cases progressing through the pipeline, or are they getting stuck at certain stages? Understanding these patterns can help you spot where your operations might be going off track.

Our dashboards make it simple to monitor productivity by tracking task completion and case progress in real-time. Whether staff needs additional training or a repetitive task could be further automated, this data lets you keep your operations humming.

Tracking billable hours

Billable hours are the time your staff spends on tasks that directly generate revenue. If non-billable tasks, such as administrative work, are taking up more and more of your time, it will be more difficult to log the hours your firm needs to be financially successful.

Litify helps you track and analyze billable hours across your team, helping you identify where time gets wasted. Then, you can make changes, like reassigning tasks to support staff or automating these non-billable activities, that help your team spend more time on revenue-generating activities.

Keeping an eye on operating costs

Last but certainly not least, pay attention to your operating costs. Every firm has expenses — rent, utilities, office supplies, and so on — but not all expenses are created equal. Some are required, while others can be reduced or even eliminated. Even small adjustments in these areas can have a big impact on your bottom line.

The Litify platform can also play a key role in your annual business planning. By forecasting your firm’s caseload and revenue against historical performance, you can accurately plan against your business expenses to ensure you’re trending toward profitability.

2. Business Development and Intakes

Next up is business development and intakes, which measure how you're bringing new clients into the fold and growing your firm. These KPIs are all about your client acquisition strategies.

Understanding marketing ROI

Start by understanding how prospective clients are coming to your firm — this is a strong indicator of the effectiveness of your marketing efforts. You'll also want to check the number of inquiries your different campaigns and marketing efforts are bringing in and how people are responding to your ads.

To save you time, Litify's open platform and visual dashboards can centralize and visualize your marketing data from various sources to help you take control of your marketing outcomes — and ROI. In one place, you can see which campaigns are driving the best results and get real-time insight into performance, from lead to settlement.

Evaluating conversion rates

It’s one thing to have prospective clients reach out, but how many of them actually become clients? Your conversion rate will indicate how well your intake process is working. Our robust analytics engine automatically captures every action and piece of data in your intake workflows and makes it available for no-code reporting. You’ll be able to track how each staff member is performing and gain insight into where leads may be dropping off in the follow-up process.

If there are any barriers preventing people from signing on, you need to know about them so you can correct them. Every lead is an opportunity, and you want to take advantage of potential business.

Tracking client referrals

Client referrals are one of the most powerful ways to grow your firm. If your current clients are happy, they’ll tell others. That word-of-mouth can work better than any marketing campaign.

The number of referrals you receive reveals how satisfied your clients are and where you might need to improve.

3. Business Efficiency and Profitability

Similar to tracking your broader law firm operations, here are a few examples of how you can ensure your business is running efficiently — and profitability

Understanding the average case value

Are the types of cases you're handling bringing in enough revenue to justify the time and effort they require? If not, it might be time to reassess which cases you’re prioritizing or how you’re pricing your services. 

Use Litify to easily track and monitor the average value of each case type and compare those values to the industry standards or your firm’s historical data to see whether your cases are profitable or need adjustments.

Measuring legal service delivery

You should know how well your firm handles every case from start to finish. You might think you’re meeting deadlines and your clients are satisfied, but that’s not always the reality. Certain types of cases may take longer than expected, or maybe your team experiences frequent delays that you could avoid with better planning. 

Our case management capabilities enable you to view each closely review progress on specific cases or by case type, staff member, or practice area. You can then set and monitor realistic goals for improvement and benchmark progress over time.

Adhering to billing guidelines

Firms that work on a billable-hour basis need to adhere to each client’s billing guidelines. Failing to meet these guidelines can result in lower payments and even damage your client relationships. 

The compliance rate — the percentage of time your firm successfully follows each client’s specific billing requirements — is a key performance indicator to monitor. 

Integrating client-specific billing guidelines into your time-tracking system gives you greater control over the billing process. Litify will alert your team if an entry doesn’t meet a client’s requirements to help you avoid disputes before they even happen.

4. Client Satisfaction

Your clients are the heart of your business, and your main goal is probably to keep them happy with your service. It’s good practice and good for your firm’s long-term success. 

Part of that notion involves focusing on client development: understanding their needs, delivering value, and nurturing relationships to build loyalty and trust. To really make these efforts count, you need to be able to measure the right KPIs.

Tracking client retention rate

Try looking at your client retention rate to see if clients tend to come back to you for future legal needs or if you never see them again and they move on to other firms. 

A high retention rate likely means clients are satisfied with your services and trust your firm to handle their ongoing legal needs. You can monitor client retention by using Litify to centralize all your client relationships and data in one place. If your retention rate seems low, you can then dig deeper and find out why.

Gathering client feedback and satisfaction surveys

Don't just assume your clients are happy – ask them! Get their feedback through surveys or direct conversations to gain insight into what your clients love about your services and where you might be falling short. 

Litify's customer relationship management features and integration capabilities allow you to collect, organize, and analyze client feedback. Maybe they were thrilled with the outcome of their case, but they felt the communication could have been clearer. Or perhaps they loved your team’s professionalism but thought the process took too long.

No matter what you learn, you’ll have a clear picture of client sentiments and be able to make meaningful improvements.

Monitoring brand reputation

Monitoring your brand reputation on review sites like Google or Yelp can also help gauge client satisfaction and the strength of your reputation. A high rating is a great sign: it means your clients are happy and willing to publicly review you as a trusted source.

These sites may be especially valuable for personal injury firms. Unlike other practice areas, where client retention is a key metric, if you’re a plaintiff firm, you’re often handling one-off cases, so brand reputation is critical. 

Just like a feedback survey, you can also create automated workflows in Litify to ask satisfied clients to leave you a review! Litify also collects and centralizes these scores so you get a full picture of your firm’s performance and can find areas to make meaningful improvements. If your score is lower than expected, you may be able to boost client loyalty (and your reputation) by addressing negative feedback, improving communication, and delivering outstanding service.

Choosing KPIs Specific to Your Firm

The KPIs that are most important for you will look different depending on your firm’s unique needs. Every law firm has different goals and challenges, and your KPIs should reflect that. For example:

• For plaintiff firms, your priorities might be maximizing the number of cases you handle and their settlement values. That would mean looking at metrics like the average duration of cases, your success rate, or the average settlement amount. For more insights, explore our Plaintiff Masterclass.
• Insurance defense firms should aim to log more billable hours, follow client guidelines, and work smarter to boost profits. This starts with improving case management processes to assign tasks, save time with automation, and keep track of all billable work. With these streamlined practices, firms can show their value to clients and stay ahead of the competition.

Dashboards, Visualizations, and Benchmarking

Once you’ve established your target KPIs, you need tools that turn that data into clear insights. 

The Litify platform gives you a current snapshot of your firm's performance so you can tell what’s happening at a glance (without getting lost in spreadsheets). Spot trends, tackle issues early, and make smart decisions to keep your firm moving in the right direction.

Then, use benchmarking to compare your results against industry standards or your own past performance. Benchmarking will show you exactly where you’re excelling and where there’s room to grow. With Litify, setting and tracking these benchmarks is simple, so you always know where your firm stands and what to do next. 

Get started to see your firm’s data in action

Tracking KPIs is just the beginning. With Litify’s user-friendly dashboards, real-time analytics, and no-code reporting, you can turn your data into actionable insights that drive growth and efficiency. Request a demo today to see how Litify can help your firm thrive.