Smarter Decisions with Law Firm Data

Jack Zinda: Welcome to The Effective Lawyer, a podcast for ambitious attorneys who want to improve their practice. My name is Jack Zinda and I'll be your host. Kevin Tully: Hey everyone. I'm Kevin Tully the chief marketing officer of Zinda Law Group. And today we're going to be talking about how law firms use data. Joining with me to discuss this topic is Zinda Law Group's CEO and founding partner, Jack Zinda. Jack is the founder and lead trial lawyer of Zinda Law Group. Jack, how are you doing today? Jack Zinda: Great, man. Good to see you. Kevin Tully: Likewise. Jack Zinda: I'm excited to talk about data. Talk about some baseball card stats we had the most home runs, top batting average, 2015. Kevin Tully: We're literally going to nerd out on this podcast. Jack Zinda: I can't wait. Kevin Tully: Jack, obviously data is super important to our firm. We've even got a core value around making data driven decisions. Tell me just kind of high level, why you think data is so important for not only law firms, but any businesses to be keeping track of. Jack Zinda: Yeah, that's a great question, Kevin and to zoom out a little bit about how I started using data to help our firm, it really started with the practice of law and not so much how we ran the business and it started with trying to figure out what were other lawyers doing that were successful on a case, which then led me to look at what are they doing in their business to get that case and taking the trail back to the initial effort. And that got me thinking about, okay, how can you track this information? And then I started reading a lot about how other businesses use information, which is all data is to help drive decisions. And as lawyers, we wouldn't go to trial without doing our homework, without researching, without seeing where the evidence led us. And it's really important that when you're looking at your business, you make similar decisions based on evidence and information, or in other words, data. But how you do that can be tricky and really important on the implementation side. Kevin Tully: Do you have a sense is something that most firms do well or is this something that most firms struggle with? Jack Zinda: I think this is something that not just law firms, that a lot of businesses struggle with. I think it's more endemic in law firms that you see not as much attention paid to it. And frankly it's because we went to law school to be attorneys. Be litigators for a lot of us or do transactional law or help with negotiations. We didn't go to law school a lot of times to look at spreadsheets or look at graphs or look at percentages. And therefore, there's almost pride with a lot of firms in not looking at this information. And even firms that are somewhat successful could be much more successful if they paid attention to this information, it would also frankly make their lives a lot easier. So I think it's a major issue that holds firms back and individual attorneys back from each and their full potential. Kevin Tully: It's really interesting the way you compare looking at data to looking at evidence and trying to see what is the story that this data or evidence tells. And through that lens, you'd think, oh, this is something that lawyers must be naturally good at, because it's very in line with what they do. As you mentioned maybe that's not always the case. So for those that are kind new to this topic, maybe we can start by defining a few of the terms that we're going to use throughout the podcast here. We have KPIs, metrics, data analytics, all these different ways to talk about these numbers. Can you describe the differences a little bit for us? Jack Zinda: Yeah. And I think the first thing to know is if you're not familiar with these terms, don't beat yourself up. I wasn't familiar with the terms when I first started my business and my law practice. And over time it becomes second nature. Just like an objection, hearsay. You just learn what it means. And it becomes very easy to handle. The first term that we're going to run reference are KPIs. This stands for key performance indicator. And this is the end of the funnel, the goal line, the touchdown, what you're aiming for. So whatever your target is, it would be your KPI. It could be attorneys' fees. It could be clients acquired, it could be jury verdicts. That's your goal. Jack Zinda: The second thing we're going to talk about is a term called metrics, which people will use the term lag indicator and lead indicator. We're just going to use the term metric for now just to keep it simple. This is the step right before the key performance indicator. So if you were thinking about it in the terms of clients, you might say the step before a client is a potential client. The step before that we're going to reference are activity numbers. So these are things that you do that lead to a metric, which then that leads to a KPI. Jack Zinda: And then when we reference analytics, we talking about how you display the information in a way that's usable. That's the really important piece. I'm sure we've all gotten reports from a financial planner or a CPA that's just pages and pages and pages of spreadsheets that no one can make heads or tails of. That's not what analytics is designed to do. Analytics is designed to take a whole bunch of data and display it in a way that you can make it useful. And a lot of times the simpler the display, the better use you can make of the data. So the three main topics, key performance indicators, metrics, activity, and then analytics. Kevin Tully: Great. That's really helpful. So to draw an analogy to the sports reference you made a minute ago, maybe your KPIs are how many points you put up on the board. Maybe your lead indicators or your metrics are how many first downs you got or passes, completed. The things that get you to the goal line, is that right? Jack Zinda: That's a hundred percent right. And if you're a Cowboys fan like I am, and I know you are Kevin, we didn't get enough of those this season. And I love the sports analogies, frankly, because if you put it in a sports context, it doesn't seem as intimidating. All of us go to... Or a lot of us go to espn.com and see the free throw percentage. And if you put that in the business context, all of a sudden we're intimidated. But if you think about sports like, oh yeah, it's a three point percentage. That's how many shots they took. That's how many turnovers they had. And then it becomes like a game and it becomes a lot easier to understand. And you want to think of your law practice like a game. Jack Zinda: One, it makes it more fun. And two, it helps you think about how I can be more successful at this game as of either as an attorney or the practice of law. And one thing I want to point out this, isn't just for how you run your practice. You can use this on cases. And we actually have a really detailed scoreboard system that we use for individual cases. All the way to how we do focus groups or how we're going to take a deposition or how we're going to pick a jury. So this doesn't just have to apply in the business sense. If you're not running your own practice, it can also apply to you as a lead trial lawyer on how you can become a better attorney. Kevin Tully: So, that's a great point with all of the things that you can measure, where do you start? How do you pick the most important ones? Jack Zinda: I think one thing that you want to keep in mind is what am I trying to achieve and what is my objective? So let's take some business aspects, I'm going to use those as examples. So if I'm going to run a successful law firm, there's probably at least two KPIs that I really need to be concerned about. One is how many clients I sign up and the second would be how much in attorney fees do I make? You may also consider how many clients do I have? How many clients do I lose every month. If I'm an hourly practice I might consider how much do I have in retainers. Jack Zinda: But you want to try to keep it to three to five numbers, preferably closer to three with whichever category you're looking at a KPI for. So you could either look at it for your whole practice or you could hone and say, okay, I'm just going to look at it for marketing. So if I was going to look it for my whole practice, I might look at the things we talked about before. If I was going to look at it just for marketing, I might say clients cost per client.,Number of potential clients might be three things that I would target there. But you want to keep it to three to five max when you're trying to analyze data, otherwise it gets overwhelming. And also it doesn't give you a good indication of which direction to turn or where to point to. Kevin Tully: This podcast is presented by by Zinda Law Group, a nationwide personal injury firm. For over 10 years, the experienced lawyers at ZLG have been partnering with outside counsel across the United States on all types of personal injury and wrongful death cases. With over 30 attorneys, Zinda Law Group has paid out millions in referral and joint venture fees since 2015. Learn more about partnering with Zinda Law Group, please email us at referrals@zindalaw.com. We'll schedule a time for you to meet with Jack Zinda or one of our trial lawyers to discuss your case. Kevin Tully: So you've got your three to five for your firm as a whole. You've got your three to five for your individual departments. Now that you've defined these metrics, how are you compiling these or how does the firm think about compiling these? Is there one person who kind of owns the data role or do you ask each of your teams to be in charge of their own metrics? Jack Zinda: Well, it's a little bit of A little bit of B and to back up a little bit on the metrics itself, because this part can be really intimidating and I want to make sure that we make it as simple as possible to create these on your own. So if you are taking something like attorney fees, you want to just go back to the very beginning of what led to that category you're looking at. So if, for example, saying, I want to hit a hundred thousand dollars in attorney's fees this month. And on average, I settle a case for, let's say a $25,000 attorney fee. So I need to resolve four cases. So that's the metric that leads to the attorney fee. And then let's say that I know to resolve four cases, I have to file six lawsuits. Jack Zinda: So six lawsuits is something I'm going to pay attention to. And I know I need to take four depositions in a month. And back to how many potential clients do I need. I need eight potential clients that lead to four cases. And so all of these, this breadcrumb, I think of it as a domino or breadcrumbs that lead to the attorney fee, you would take that initial pieces of information that you have from your experience, line it up and see how many of those you need to reach your goal. Jack Zinda: One thing that just blows my mind is how many lawyers don't have goals for either their cases or their practice. Now, if I'm looking at an individual case, I might say, okay, I want to get this case resolved for at least a million dollars in less than 14 months. And there's a list of things that I'm going to need to do in track to achieve that objective. So it's always starting with the end and lining it up to get to the things you are in control of that will lead to that indicator of that result. Jack Zinda: And then if things are going in the wrong direction, you figure out which one of those levers do I need to change to adjust results. Now, if I'm... One thing that's really important that you mentioned a second ago, Kevin, is who's going to track and store the information. In the perfect world, it would be stored in a software platform that's going to automatically capture a lot of this stuff. And there's relatively inexpensive platforms now in just about anything you want to track. If you're talking about marketing, it might be something like Zoho, that's a relatively free CRM. Or you could go more complex into something like Salesforce. If you're talking about financials, it might be something called QuickBooks or some other financial platform. But you want to assign one person on your team to be in charge of compiling and tracking the reports that you're going to use to make these decisions. Jack Zinda: Now, everybody on the team is responsible for making sure accurate data is into whatever system you use. For example, if you're tracking the number of cases you receive, but the person that signed up the case, doesn't put it in your system. Well, whoever's doing the reporting is not going to be able to get an accurate report out of it. So you want to assign one person to be in charge of the reporting, but then make sure everybody has a fidelity to accurate information. Because garbage in garbage out, you'll start making bad decisions based on bad data. Jack Zinda: The second piece of that is you want to pick a timeframe that you're going to look at this data on a regular basis. I think anything more than weekly is too much. Monthly is probably ideal. For some things you could look at it quarterly. And a few examples of that, we look at average time to resolve, how long it takes to resolve a case and the average result once a quarter. Jack Zinda: If I look at that information once a month, it's not going to have a big change. We look at how many cases we've signed up once a week. Because that does change greatly once week to week. And I can affect that in the short term. So you want to figure out how often you want to look at it often, do you need that accurate data? Data can either be precise or timely, but it can't necessarily be both at the same time. So if I want to have the data for the month end, it's going to be off by the time I look at it because it's not real time if I'm closing the books. Or I could say, I want it up to date to the last minute. Well, you may not be able to see it as quickly as you want to. Kevin Tully: Right. Right. So not all data as created equally. Jack Zinda: Exactly. Kevin Tully: Yeah. Okay. So let's talk a little bit about how you use the data once you have it. And I'm going to put you on the spot a little bit here. Are there any aha moments that you've had either recently or ones that just stand out from the past where you gained some insight about the firm that was surprising based on the data Jack Zinda: I love being put on the spot. I love to tap dance. Kevin. Here's a couple things that I will say. One is you want to make the data very, very simple to read and easy to use. So I like to use colors that symbolize if the is going the right direction or wrong direction. Red is bad. Yellow is caution. Green is good. That's so I can see the data quickly and really see, okay, are we on track or off track. An example of one that we spotted at the end of the year, and there's a couple examples. One was the number of cases that were settled, but not closed out. We saw that number was significantly higher than we like to see. And that was shown just by a percentage of cases that had been closed or resolved, but not closed out within 60 days of them closing. Jack Zinda: Now that's important because we want to make sure we're dotting our I's, crossing our T's and we're not committing any sort of issues to make sure we're getting the clients all their funds quickly enough, making sure that all the documentations occurring fast. And so that helped us identify that. Jack Zinda: Another area where it was extremely helpful was the average time to resolve a case. So the window from when we sign up a case to when it either goes to trial or settles ahead of time. We noticed that it was ticking up from 10 months to a little over 12 months recently. And we dug into the data and we saw, hey, we have about a 30 day delay from when we're deciding to file a lawsuit to when we're actually filing the lawsuit. And that came down to why is that happening? Oh, we don't have enough resources to draft the number of lawsuits that we need to get done at times because it kind of comes in waves. So we're able to bring on some part-time help to help get the drafting backlog caught up and get that number back down to closer to the 10 number that we like to see. Jack Zinda: That's a great example of where we took something that was easy to identify, because it was kind of flashing red, then dig down to what can I do to affect this today instead of just waiting for the end results. And there's a ton of other examples like that I've used successfully in my practice over the years. Another great one is cashflow. We do a cashflow analysis based on future revenue every week, looking out six months. And so I can see if it's red five months from now, okay. Why is it red? Is it because of an expense or a revenue? Okay. If it's because of revenues, is it because of a case issue, is it because of a data issue and I can dig into help solve the problem before it comes a crisis. Jack Zinda: One of the really cool things about if you're looking at the right numbers, you should end having emergencies that create a lot of fires. Another way that it can really to help you on the case level. So whenever we sign up a case, we look at how long it's been in the investigation stage. And so we give ourselves two weeks once a case has been signed up to see, is it a case we want to keep based on liability, damages, source, recovery. And I can look at the firm as a whole, what number of cases have we had for more than 14 days that are not on the investigation stage? Now there's a certain percentage, well, that's just going to be the case. There's nothing we can do. It's taking longer to evaluate. Maybe it's a products liability case or a medical malpractice case that it's more difficult to figure that out. Jack Zinda: But on average it should would be at a certain percentage. And if I see that percentage is getting higher, then all of a sudden I know that we have a problem and I can dig into, is it a certain lawyer? Okay. Yes. It's attorney A, it's not attorney B, C, or D. Okay. What's attorney A doing wrong. Oh, they're not going out to the scene as much or getting the photographs they should as quickly as they should, or maybe they're overloaded on cases. And now I can make decisions based on that. So those are a few examples we've had that have popped up. Happy to talk about more if you think of any that you think people would want to hear about. Kevin Tully: No, I think that's great. It perfectly illustrates how if you start with a goal and you measure against that goal, you can identify when you're off track. And then as you said, in the beginning, you can follow the trail back to see where along the line you've kind of gone awry and what you need to do to correct it. Talk to me a little bit about getting your team to buy into the notion of collecting and analyzing data. You mentioned that lawyers, it's maybe not their default nature to want to do this. What tactics and techniques have you used to get the team aligned on this mission? Jack Zinda: I would say this is one of the hardest things. And it took years to get me to figure out how to get people to buy into this. Because when you first explain this to people, they look at it like busy work and that it's not going to help them. So the first thing I would say is you got to show them how this is actually going to help them. And so instead of just telling them to do something, walk them through the process we just did on every metric that you're measuring. And what we've had to show the lawyers in particular is how this data actually is showing something is wrong on a case level. And it's not just a data point that I've randomly picked out of the air. Jack Zinda: So we were talking about like that investigation stage. Another data point we look at is how long does it take us to draft a demand from the date that we decide to send a demand. Another metric we look at is how long does it take us to receive a medical record once we've requested from a doctor. Or how long it's taken us to get a depo set when we file a lawsuit. And so what I'll do for the attorneys is I'll break all of these areas down and I'll show them how, if this one is 30 days behind and this one is 30 days behind, and this one is two weeks behind, all of a sudden a case that could have gotten and resolve for a client in 11 months took 19 months. And then I show them how that affects their bonuses, how that affects the client, how that affects their long term success, how they can go from being able to handle 50 cases to only 35, because the cases are backlogged now and trying to show practically how it works. That's the kind of thoughtful way to explain it. Jack Zinda: The other thing that, and this may sound a little harsh. You have to hold people accountable and hold the teams accountable for putting in correct data. We as lawyers, we would never sign up pleading with the wrong client's name. So it's important that you explain to the team it's just as important that this piece of information is in the system at the same level of quality. Because if you don't, it can become a culture where the data is consistently about 80, 70%, which almost makes it worthless. And then when you try to coach people using the data, they say, "Well, hey, the data's not even right. Why should I listen to you if this isn't even accurate?" And it becomes this terrible cycle where the data's wrong. So people aren't bought into the data. So then for they don't see the usefulness of it and now it does become just busy work. And so it's better to not do any of it than to do it about 60%, 70%. Kevin Tully: Right. Makes sense. What else? What else comes to mind when thinking about data for law firms? Jack Zinda: Yeah. Well, and just on that topic we were talking about before, I mean, I think it goes to the people you want to hire as well. I don't think you have to make this a die this hill, you must enter things into a system to work here, but you want to make sure you hire people that it's not going to be really difficult to get them to buy into some of these aspects. Some really amazing trial lawyers that I know that work on, say, one case at a time that don't have many areas to look at, would hate dealing with the data that we have to deal with. So you want to make sure, can you get people bought in. That's why it's one of our core principles. And the core principle is we make data driven decisions. Jack Zinda: The other thing I wanted to make sure I hit was ways that you can use this in litigation and other ways you can use it in your business. So one cool way we use it is in focus groups is we will track the demographics and different ways that people look at issues in focus groups. And then we'll combine that to see if there's trend lines with how certain age groups, income brackets, geographic areas might identify or not identify with an issue. For example, we practice in Colorado and Texas. Colorado has legalized marijuana, Texas did not. And occasionally we'll get a case where one of our clients were injured and this has nothing to do with the injury, but they may have had marijuana in their system. Jack Zinda: Someone in Colorado made the look at that very differently than Texas, or maybe they don't and we actually did a few focus groups recently, and we're very surprised that five years ago that would've been a death knell in a Texas case, all of a sudden that's not as big of a deal. So we use that data to actually drive our advocacy and decision making in our actual cases, which I think that's where it gets really fun. Especially if you like to litigate and try cases, like then you start getting into some really cool stuff about how you look at it, what witnesses you want to call. Jack Zinda: And one cool idea that we've really been talking about is for all the cases we try and people we take depositions of, is there a way to combine all that information, to try to look at a big data set, to help us make decisions on what cases is to bring to trial, how do you value a case. And that's another area that we've had a lot of success is using the data we've compiled to deciding what's a case worth, what's it valued at? And we'll look at verdicts that other firms have gotten and that we have gotten, we'll look at the average settlements that we've gotten of these types of cases. And we've even combined data with other law firms to share that so we can pull it all together and see, okay, if we are dealing with a trucking case in West Texas with these set of facts, what do we think the case should be valued at versus East Texas. And as anybody that tries cases knows, you've got to decide what the value the case is so you can decide if I'm going to take it to trial or not. Kevin Tully: Now, just out of curiosity. Is this something that you had in your arsenal when you first started as a lawyer? Or did you learn a lot of this along the way? Jack Zinda: Oh man, I had none of this when I started as a turn me, I knew nothing. I honestly got a lot of these ideas from thinking about how insurance companies work and how they evaluate cases. Because it bugged me when I first started practicing, I was like, how the heck are they coming up with these numbers? They just seem to be at random. Allstate offers me 10 cents on the dollar. Another insurance company offers me 300%. And I said, they must be doing this based on something. And I started thinking, well, they they've got a lot of clients, customers, and they have a big geographic region. So they must be based it in on information. And I thought, gosh, what if we, as plaintiffs' lawyers had similar pieces of information that we could drive decisions on. And so kind of the curiosity started there. Jack Zinda: And then just over time, observing what other law firms are doing, what other businesses are doing. Because frankly, a lot of times law firms and lawyers are late adopters and we're not the best at being innovative. So I don't always get the most use out of looking at what other law firms are doing. I'll look at what other industries are doing. and you can get some really good ideas that way. So Kevin, I mean, I know you've dealt with data a lot in your roles as CMOs at different companies. Are there any recent sources you can think of that maybe I don't know about or some of the listeners may not, that might be useful? Kevin Tully: Yeah. There's a great book called Measure What Matters by John Doerr. You could check that one out. It's a good place to start. I take a lot from the book Traction too, by Gino Wickman, which it's not completely about data, but there's some good chapters in there about collecting the right amount of data. Kind of sticking to that three to five principle that you mentioned earlier. And then I think finding the right balance in a tool that you're using, that's flex enough to collect the data that you want to have access to, but isn't too overwhelming for your team, I think is really important. So that everyone can get value out of it. But also can be flexible enough to meet the needs of your particular business. And that can often be kind of a tricky balance, but I think that's something to be aware of and try to find that happy medium on. Jack Zinda: Yeah, you don't always want to get the Cadillac software program. I mean, and frankly, there's been so many times I've bought some software platform that I thought's going to change everything. And I end up going back to Excel because it's just too many bells and whistles. You need a certification to figure it out. Kevin Tully: Yeah, for sure. Jack Zinda: And another thing I would just tell everyone is don't be intimidated by the word data. I mean, change it to scoreboard. Then all of a sudden it becomes a lot less intimidating than data and analytics and all these big words that people use to make something kind of simple, seem complicated. And as lawyers, one of our main is to take a complicated subject to make it simple. And this is just another tool in the toolbox to do that. Kevin Tully: Just out of curiosity, to jump to kind of the more advanced end of the spectrum for a second. Have you ever considered creating a data environment where you could use something like SQL to pull any piece of data out of a data warehouse and manipulate it however you want with code like that and sort of making that available for those that feel comfortable with that type of thing? Jack Zinda: Yeah. I mean, one thing that we've talked about as a firm and I've talked about a few other attorneys I know, is creating a platform where you could share data across different law firms. Somehow taking the data, keeping it real simple in, like you said, a SQL database and then allow it to share almost like a social media platform for plaintiffs firms to share data across locations and be able to visualize it real easy, real simply. Kevin Tully: That's really interesting. It might be a way to catch up on the insurance companies a little bit. Jack Zinda: Oh, I know it drives me crazy because I just know someone like Allstate has 10 million data points and no matter how good your firm is, you are very limited in your knowledge and knowledge is power. So... Kevin Tully: Yeah, for sure. Well, cool, Jack. Anything else you want to touch on, on this topic? Jack Zinda: No, I hope somebody got some use out of this. If you have any questions about what we do, like to see templates, I mean, we have data tracking for marketing. Of course, Kevin knows all about, for revenue, for litigation metrics, depositions, hearings. I mean, we have reports for just about every everything. And if you're interested in getting a version of it or a copy or a template, just email me or Kevin and happy to pass it along to you and help in any way we can. Or if you just want to chat about how to look at data for your own law firm, because every firm's different, happy to help out any way we able to. Kevin Tully: That's awesome. You know what? We'll put that in the show notes, we'll put a link to maybe just a checklist of some initial KPIs that law firms can think about and put some of those templates in there as well. So that's a great idea. Thanks Jack for your time. And if there's anything else that people have questions on, what's the best way they can get in touch with you? Jack Zinda: Just reach out to info@zindalawgroup.com or you can call me at the firm at (512) 246-2224. Thanks Kevin. Kevin Tully: Thanks Jack. Thanks for your time. Kevin Tully: Thanks for listening to today's episode of The Effective Lawyer. You can learn more about our team and find to other episodes of our podcast@zindalaw.com. As always, we'd appreciate that you subscribe, rate, and review the pod. Thanks.