September 25, 2024

 Paula Forbes

best practices trends flexible resourcing

If, as the saying goes, ‘people are an organisation’s greatest resource,’ what is the best approach to managing that resource for maximum ROI, that is, to not merely alleviate short-term staffing challenges but also drive strategic and business value?

What does successful resource planning require?

Law organisations face numerous challenges in allocating and utilising resources to maximise efficiency and avoid under- or over-utilisation. These include balancing workloads, ensuring adequate staffing levels, forecasting demand for legal services, and controlling costs (or, in some cases, reducing them). They also face pressure to increase productivity and efficiency and comply with ethical and regulatory requirements. If this weren’t enough, changes in technology and client expectations would require law organisations to continuously evaluate and adjust their approach to and strategy for resource planning. In short, these organisations must find effective ways to balance these competing demands to provide high-calibre legal services to clients (internal or external). This requires finding the right balance between the work to be done, who will do what, and planning for the future.

Why Resource Allocation Matters 

Effective resource management involves:

• Determining the best distribution of work across individuals and teams to achieve key business and strategic objectives
• Being able to react to business requirements by improving the ability and accuracy of distributing resources where and when needed
• Making data-driven decisions based on identifying areas that are ‘over’ and ‘under’ worked
• Achieving high visibility into anticipated demand to assess and accurately forecast future resource needs and then plan accordingly
• Improving efficiency and productivity
• Increasing staff retention and expanding the organisation’s knowledge base through enhanced support for individual career and skill development and retention of corporate knowledge

When done well, resource management helps drive increased profitability through more intelligent resourcing, better budget vs. resource data, greater visibility into forecasted activity, identification and early mitigation of risks and resource pinch-points, and improved career development support for talent.

The Pitfalls of Partner-Led Resource Management

Some law firms continue to rely on partners to lead and execute staffing for their projects.  Usually, this rests on a belief that, as costs within a law firm receive greater scrutiny, firm partners (who are ultimately accountable for the profit and cost of their practice) are best positioned to own their practice’s resourcing.  The results of this approach remain very mixed.  Whilst it spares the firms of overhead (i.e., the costs of a Resource Manager (RM) or team of RMs), partners often have a limited view into whom in their firm has the availability, skills, or experience to support particular work, resulting in suitable colleagues being overlooked and under-utilised.  I have yet to meet a partner with enough time to develop a business, respond to RFPs, win and deliver work, and also have a clear grasp and passion for recruitment and resourcing good practice.

Nevertheless, at many law firms, resourcing and work allocation continue to depend on an individual partner’s network, which significantly limits the resource pool. This, in turn, creates real risks, both to revenue (i.e., from a partner having to turn work away due to perceived staffing constraints) and client relationships (which can also suffer through, e.g., a firm’s inability to deliver services, having to no-bid an RFP, or being unable to pursue a secondment opportunity).

The Importance of Visibility

As with any business, it’s essential to have complete visibility over your workforce. This includes the ability to look into the future to make informed staffing decisions at the right moment, or structure staffing to enable a law department or firm to respond quickly as needs arise. Another dimension of visibility is scrutinising how work is designed, structured, and organised. The resulting insights enable staffing models that deliver significant cost savings and improved business results.

As I will explore in Part II of this series, many tools are available to support the RM function. Especially useful are those that enable an organisation to see who is available quickly (and where) to staff engagements according to skill levels and when outside support may be required.  These tools save valuable time otherwise required to analyse the data in question.  The faster and deeper a law organisation can analyse data, the better informed many of its business decisions will be, such as whether to outsource the staffing on a non-strategic client secondment to an ALSP and thus retain a specific skill set for a higher value, strategically aligned engagement.

The visibility-centric and data-driven approach also encourages consideration of new ways of delivering and sourcing work to facilitate learning, professional development, and sharing institutional knowledge.

Follow-On Benefits: Recruiting and Retention

Effective resource planning can also reduce recruitment spend by increasing staff retention. By taking into account individuals’ career development, staffing decisions can increase engagement and retention by matching them with learning and development opportunities that build on their existing skills and experience. Another consideration is utilisation.  Over-utilisation can lead to burnout and attrition. Under-utilisation risks disengagement and attrition by those seeking greater challenges and development opportunities elsewhere. Both types of attrition drive recruitment spend. Of course, some level of turnover is inevitable. By using rigorous analysis and a data-driven staffing process, organisations can reduce staff replacement costs and inform a targeted approach to recruitment.

Innovative Approaches

Many large law organisations – law departments and law firms alike – are beginning to understand that resource management is a business-critical activity. My colleagues and I see this first-hand in our work advising and consulting organisations worldwide and applying our expertise in their work to model and plan for their resource needs. Some organisations choose to work with us to reallocate resourcing spend, augment their legal teams to align with strategy and succession planning goals, or explore outsourcing certain parts of the business using cost-conscious options, such as managed services or low-cost delivery centres to support repetitive high-volume work.

In Part II, I will explore various tools that enable insightful and impactful resource management and how they can ensure they are prepared to meet fluctuating demands. Stay tuned!