For Law Firms

Always Be Closing: The ABCs of Continuous Improvement

A law firm client whose practice primarily focused on high-end transactional work did an analysis of the number of timekeepers and hours billed over the life cycle of a transaction. Interestingly, the data showed that both metrics dramatically increased within the last two to three weeks of a transaction. This held true across numerous transaction types, from M&A to financing to securities. The law firm client endeavored to understand what was happening and whether this process could be improved.

The project started with a process map of how transactions were closed and examined all aspects of the closing process – from finalizing documents to gathering signatures to assembling both electronic and printed copies of the closing books. We applied the principles of Lean (doing only the right things) and 6-Sigma (doing those things extremely well) to identify numerous points of inefficiency. For example, across the different practice areas, certain areas for improvement were consistently identified such as late initiation and hand-off, or duplicative printing, or duplicative tasks.

The law firm decided to redefine the process for closing transactions and to retrain its lawyers and staff in the new process. Additionally, the firm invested in new technology that streamlined the production of final documents and hand-offs among team members. Through these improvements, closing costs were reduced by 60% and turn-around time for producing closing books was improved by 80%.