Old paradigms about how to measure performance might be preventing, rather than motivating, your law firm's success.
This is the twelfth in a series of sixteen articles that explore the relevance and, for some law firms the existential importance, of W. Edwards Deming's Fourteen Points, especially for small and midsize law firms.
W. Edwards Deming's eleventh point for quality management, eliminate numerical quotas, challenges the notion that numerical targets are the most effective way to measure and drive productivity.
As Deming used the term, quotas refer to fixed numerical goals set for production or performance. They are used to define success: meet or exceed the "magic number" and you are a success; failing to meet it means that you are a failure. In law firms, this can translate to billable hour targets, number of cases won, or number of new clients acquired within a specific period. While these metrics can help measure progress toward goals, they also can inadvertently encourage a quantity-over-quality mindset.
Why Qualitative Goals Matter More in Law Firms
Law firms thrive on the quality of their legal services and client relationships. In this context, qualitative goals -- not just rigid numbers -- are more indicative of progress and can have greater diagnostic value in detecting and addressing problems before they become crises. For example:
Client Satisfaction: The level of client satisfaction is a crucial -- and ultimately the most reliable -- indicator of a firm’s service quality. Happy clients lead to repeat business and referrals, both vital for long-term profitability.
Reputation and Brand Strength: A law firm's reputation for thoroughness, ethical standards, and legal acumen cannot be quantified, but it significantly impacts its competitive success.
Employee Development and Satisfaction: Fostering a skilled and satisfied workforce contributes to the overall health and sustainability of the firm.
Finding the Right Balance
Balancing quantitative goals with qualitative outcomes is the key. This is a management skill that, unfortunately, few law firms attempt to master. While billable hours or case numbers are important, they should not overshadow the importance of delivering high-quality legal advice, maintaining ethical standards, and building strong client relationships -- in short, meeting the client's needs and expectations the first time and every time.
Law firms can achieve this balance by:
- Setting realistic and relevant performance goals that do not compromise the quality of work or the well-being of lawyers.
- Emphasizing that the primary value of performance goals is diagnostic -- to assess progress and identify problems in the way the work is performed -- not punitive.
- Encouraging lawyers to spend time on professional development, community engagement, and building client relationships, even though these activities may not immediately contribute to direct revenue.
- Implementing a comprehensive performance review system that values quality of work, client feedback, and contribution to the firm’s professional culture and long-term business and professional sustainability, alongside quantitative measures.
In essence, Deming’s eleventh point urges law firms to look beyond the numbers and focus on the broader aspects of their practice that contribute to sustained success. Quantitative goals are undeniably important but must be balanced with qualitative objectives that uphold the firm's integrity, reputation, and commitment to excellent service. This holistic approach not only aligns with Deming’s principles of quality management but also ensures the long-term health and competitiveness of the firm in a dynamic legal landscape.
Our next post: Remove Barriers to Pride and Professionalism
W. Edwards Deming's Fourteen Points provide a framework for sustained growth, improved quality, and better client service. Their successful implementation will require commitment, leadership, and an ongoing dedication to improvement. The law firms that integrate these principles into their daily operations will be well-positioned for future success in the ever-evolving legal landscape.
To learn more about the Fourteen Points, consult W. Edwards Deming, Out of the Crisis, (Massachussets Institute of Technology, 1982). Future posts in the Walker Clark World View blog, will examine the strategic relevance and practical application of each of the Fourteen Points to law firm operations and management.