Lock-up

For a professional firm, work-in-progress days plus debtor days per client: the time between work done and cash received. The split says whether the delay is billing cadence, the partner's lever, or collection, the client's. In cash, unbilled WIP plus outstanding debtors.

DefinitionFor a professional firm, work-in-progress days plus debtor days per client: the time between work done and cash received. The split says whether the delay is billing cadence, the partner's lever, or collection, the client's. In cash, unbilled WIP plus outstanding debtors.

Per client, not per firm

The firm's 110 days is a few clients at 200. Each has a cause and a lever.

The cash figure

Days do not persuade a partner. Dollars tied up in their book do.

How it is computed

Unbilled work in progress plus unpaid bills, divided by average daily fees, per client, giving days.

Example

A client has $120,000 of unbilled time and $95,000 of unpaid invoices against fees of $1,310 a day: 164 days. The firm's average is 95.

Where it goes wrong

Reported firm-wide. A few clients, usually the ones partners are reluctant to bill, hold most of it.

Articles that use this term

Board and management reporting

Level and trend: why the direction outranks the number on almost every desk

Why the level of a measure, 52 percent concentration, 74 percent OTIF, 88 percent lock-up, is the least informative thing about it and the trend against the measure's own history is the finding, the four exceptions where a level is a hard threshold, the window a trend needs, the consecutive-period rule that separates a bad month from a deterioration, the trend of the reference itself, and the rule that every level on a report carries its trend beside it.

16 Sept 20263 min read Board and management reporting · Law firms

Lock-up by client: the cash a matter ties up, and the clients that tie up most

How a law firm measures lock-up per client from time entries, bills and receipts: work in progress days and debtor days, the total days between work done and cash received, the norm per practice from the firm's own book, the clients whose lock-up is well above it, the partners whose books carry the most, and the two levers, billing cadence and collection, that the split points to.

16 Sept 20262 min read Board and management reporting · Law firms

Ten questions a managing partner asks about the firm's clients, and the table that answers each

The ten questions a managing partner of a law or accounting firm puts to the partners about the book, which clients use one practice, whose book depends on one client, which clients drifted in price, which have not started this season, where is the cash locked up, which partners send work across the firm, which proposals cost more than they win, what triggers sit in the compliance data, which matters were staffed above their price, and what changed, each with the table from the practice management system, the identity behind it, and the answer a managing partner should send back.

16 Sept 20262 min read Alternatives and comparisons · Law firms

How to choose analytics software for law firms: questions, data and traps

How law firms should choose analytics software: start from the questions, check the data you hold, ask vendors ten questions, avoid the traps.

24 Sept 20264 min read Alternatives and comparisons · Tax and accounting

How to choose analytics software for tax and accounting: questions, data and traps

How accounting firms should choose analytics software: start from the questions, check the data you hold, ask vendors ten questions, avoid the traps.

24 Sept 20264 min read Board and management reporting · Law firms

Client and business development KPIs for law firms: ten measures that matter, each with its formula and the export it comes from

The ten client KPIs a law firm should run on, each with its formula, the export it comes from and what it tells you: practice areas per client against the norm, dormant clients by prior fees, billing and collection realisation by client, lock-up by client, partner book concentration, cross-referral between partners, matter profitability by leverage, client fee concentration, share of client legal spend, and new matter origination. Also the three measures most firms miss, the figures to drop, the identities, and who owns what.

17 Sept 20264 min read