The ABCs of Maximizing Realization Using a Practice Management System

Realization is the single most critical measure of profitability for your firm.  Relying on a practice management system can help make the otherwise often cumbersome task of benchmarking and monitoring realization on various projects or the specific items that support those projects, much easier.  Here are some of the ways that a practice management system with realization capabilities built in can help you at every stage in your realization analysis.  

A. Planning: Setting the stage for strong realization should begin the moment you start planning for a new project.  Using a practice management system can aid you in your planning efforts by allowing you to establish specific tasks within the broader project you’ve added to the system, budget each task, and identify the staff responsible for completion within the planned timeframe.  This will help you as you move forward with the work associated by enabling you to use the data points to ensure you’re not running over the time you’ve allocated to the engagement.  

B. Tracking: Once you’ve input the project, its tasks, the associated budgets, and responsible staff into your practice management system, you can track the entire engagement by task level and access real time updates as each task either moves to completion or hits a roadblock.  The flexibility to track in this detailed manner helps your engagement stay on track so it gets completed on time and there are no surprises along the way.  Seeing how many billable hours are actually being charged versus the anticipated hours that were originally expected can help you fine-tune your scheduling to keep your staff in closer alignment with the engagement’s budget.  You can adjust timelines as soon as issues arise and pinpoint exactly where a project is bottlenecking (down to how long each task is taking to complete) so that you can fix the problems, identify additional out-of-scope billings, or adjust the staff assigned to keep the engagement moving fluidly.  A practice management system also allows you to set up automatic alerts that let your management know which professionals or practice areas are excelling, which are slowing down the progress of your engagements, and when engagements are nearing or have exceeded budget, so you can make the necessary adjustments.  

C. Key Insights: If you wish to delve into your practice management system’s reporting feature more deeply, you can gain valuable insights that point the way towards who your most and least profitable clients, engagements, service lines, and professionals, are.  The realization numbers encapsulated in the system show you the percentage of realization by partner, project manager, and staff, and how each is meeting or missing the mark when it comes to billing for the specific time periods you set.  A close look at the service lines and clients who are underperforming can help you refine your organizational structure and help you cull clients who are no longer proving profitable.  

If you’re interested in increasing your firm’s overall realization or are looking to determine which areas of your firm are impacting realization the most, a practice management system may be a good investment for you to consider.  Please contact us to request a PracticePro 365 live demo to see how realization can be monitored.