Planning critical to law firm financial management

With law firms under more pressure every day and challenges such as money laundering, cyber fraud and increasing regulation, it is more important than ever to have an agile approach to financial management, delegates from regional law firms were told.

The regular meeting of Compliance Officers for Finance and Administration (COFA) at Crowe Clark Whitehill’s Midlands office heard that tools used in manufacturing could apply equally well to a law firm.

Ross Prince, professional practices partner, outlined tools in five areas that could help.

He advised simple, agile business planning through a One Page Plan and recommended a tool used in manufacturing as an effective weapon in risk management.

“Failure Mode and Effect Analysis – FMEA – can work just as well for you as it can in the production process,” he told delegates.

He extolled the benefits of time management using the Covey Matrix, and the “Must, Should, Could” process.

Other areas discussed including giving staff effective feedback, managing conflict, and ways of solving problems.

He said: “”Building a successful finance department goes well beyond having robust systems and controls. Investing time in your team’s development gives people a toolkit that enables them to solve problems, think strategically and implement change quickly.

“For me, these are the real factors that will bring success in this current volatile, unpredictable environment.

“These simple ideas can change the way law firms think about strategic planning, solving problems, managing risk and implementing change.”

Members of Crowe’s COFA group agreed that business planning now needed to be more agile than ever and that the One Page Plan approach gives clarity, focuses on a clear destination and defines actions and accountability to get there – all factors critical to success.

Ross Prince said: “Members commented on how easy it is to be distracted by trivia and interrupters and we pointed out how time management tools can help you reclaim your focus.

“We also discussed the need to prioritise risk and think about it in its simplest terms – its severity, likelihood of occurrence and, importantly, ease of detection. We then talked about the various types of controls that can be put in place to mitigate those risks.”

Crowe’s COFA network meetings are open to all law firms across the wider West Midlands and the next meeting is on Tuesday, 17 January.