2024 Bright Insight

02

PROFIT MAXIMIZATION & COST MINIMIZATION In light of increased capital costs and cash flow uncertainty, law firms will consider a variety of strategies to maximize profit and minimize costs. Regardless of the size of the law firm, partners seem to have an accord surrounding the tactics they plan to deploy over the next 12 months to maintain or increase firm profit: recruiting laterals, increasing business with existing clients and expanding headcount. Differences between Global/Am Law 100 firms and all other firms show slight variance across each category, but responses indicate agreement that strategic lateral hiring to strengthen existing practice areas and increasing business from existing clients are the key to near-term success. Strategies that involve increasing human resources are more pertinent to profit growth than downsizing as more than 40% of survey respondents are considering headcount increases while less than 20% are planning layoffs. In fact, real estate costs and other non-personnel costs (e.g., operating expenses, technology costs, marketing spend, administrative expenses, etc.) are a larger target for cost minimization than attorney and staff layoffs.

18 | BRIGHT INSIGHT