Comments on: Hey Lawyers – What Ever Happened to Value Billing For Legal Services?

By: Ben Glass

Ben Glass — Wed, 29 Oct 2008 06:19:32 +0000

It’s amazing to me that so many lawyers are still working off of a billable hour model, trading hours for dollars. That’s a clear roadmap to average results (and must be terribly scary to a client)–not knowing what its going to cost.
I always be the voter for good, effective marketing that is not about the lawyer but enters the conversation going on in the potential clients mind. Its by having a steady stream of potential clients that you can choose to represent that
1. allows you to get full value for your expertise and
2. allows you to be the best lawyer you can for your “perfect client.”

By: Ben Glass

Ben Glass — Wed, 29 Oct 2008 06:19:00 +0000

By: Carolyn Elefant

Carolyn Elefant — Wed, 22 Oct 2008 00:39:38 +0000

Andrea,
I agree that lawyers should be paid for the value they provide. That is why I find it odd that lawyers are now cutting rates. You’d think that value would remain constant and not ebb and flow with the economy. I haven’t had to change my practices in this economy or lower my rates because they’ve been reasonable all along. And I often tell client that in ongoing relationships that if they cannot discern a benefit from using my services than they shouldn’t retain me.
Josh, you are correct that value billing is tricky. But it is most difficult, I think for someone who is providing contract attorney services because in most cases, you are not in control of the matter. YOu depend upon what the attorney delegates to you and that can make it even harder to figure out how much time the matter will take.

By: Carolyn Elefant

Carolyn Elefant — Wed, 22 Oct 2008 00:39:00 +0000

By: Andrea Riccio

Andrea Riccio — Wed, 22 Oct 2008 00:25:20 +0000

If we are going to really talk about “value billing” we need to look at value from the client’s point of view. Most times when lawyers talk about value billing they are really talked about fixed price billing – which is still billing based on the amount of time the lawyer puts into the file.
True value billing means determining what our services are worth to each individual client. The same activity may be worth not be worth the same amount of money to different clients. Similarly the same activity may be worth more or less at different times.
There are things that I do that don’t take up a lot of my time but are of tremendous value to the client. If the activity saves my client tens of thousands of dollars, why shouldn’t I ask to be paid say $2,000.00 even if I only spent one hour on the file.
$1,000 hourly rates are a joke because I’ve never met a lawyer in 20 years of practice that consistently produces work of that value day in, day out, but there are times when we do and when we do there is no reason we shouldn’t expect to be paid for it.

By: Andrea Riccio

Andrea Riccio — Wed, 22 Oct 2008 00:25:00 +0000

By: Joshua A. Andrews

Joshua A. Andrews — Tue, 21 Oct 2008 18:22:21 +0000

I think value billing is a wonderful alternative to the billable hour. The problem, however, with value billing for new lawyers is that setting a fair value for a service (i.e. a project or case) feels like a shot in the dark, whereas setting a fair value for your services (i.e. your billable rate) is easy to determine. I, personally, am not aware of a standard for new lawyers to measure value billing. It seems, just starting out, that a fair billable rate is the best way to provide top value with the client’s budget in mind.

By: Joshua A. Andrews

Joshua A. Andrews — Tue, 21 Oct 2008 18:22:00 +0000

By: David Giacalone

David Giacalone — Tue, 21 Oct 2008 09:12:57 +0000

Yes, Carolyn, how the lawyer uses any particular billing method is the key. Each method has its own potential pitfalls for the client. It’s good to see that market forces — lots of providers chasing fewer (or poorer) customers — is helping to bring down fees. To the extent that value billing attempts to protect the lawyer from competitive forces and deny the client the benefits of competition it increases the chance that resultant fees will be unreasonably high.

By: David Giacalone

David Giacalone — Tue, 21 Oct 2008 09:12:00 +0000