Timesheets on the defense Down Under

Thanks to John Chisholm, some of Australia’s legal firms are taking Value Pricing seriously and establishing value councils, while a few are placing the timesheet on the dust-bin of history.

One of those firms is the Perth firm Lavan Legal, with 20 partners and 200 team members. It has appointed a 10-person pricing committee. As this recent article in The West Australian makes clear, Lavan is planning to trash its timesheets.

John and I have had the pleasure of working with Lavan, and the managing partner, Greg Gaunt, and the deputy managing partner Dean Hely, are both visionaries in the legal profession.

Lavan does major litigation, and although they are still making their way towards pricing this work based upon value, early results are encouraging.

There’s another firm in Perth going down the same road, as well as other firms throughout Australia.

Another firm with an innovative business model is Marque Lawyers, founded by Michael Bradley. I’ve had the pleasure meeting Michael and he truly has a Zen perspective on the practice of law—a refreshing and optimistic point of view about the future.

Michael was recently interviewed by Lawyers Weekly, where he linked timesheets to depression in the legal profession.

Two other articles in Lawyers Weekly discussed the VeraSage Institute’s Quest to bury the billable hour and trash timesheets: Take timesheets to the gallows and The man on a timesheet-killing mission.

Earlier this year in May, The Honorable Wayne Martin, Chief Justice of Western Australia, delivered a speech on the perils of both the billable hour and the timesheet. You can read the Judge’s speech here.

Obviously, something is going on Down Under.

It’s not enough to advocate that firms move to Value Pricing. The timesheet must be attacked as well.

After all, it is the timesheet that is the ultimate cancer, because it is the wrong measuring device for intellectual capital.

Thinking that we are measuring the efficiency, let alone the value, of knowledge workers by denominating everything into hours is simply ludicrous.

It’s the equivalent of arguing that Jonas Salk’s polio vaccine is valuable to the extent of the time it took him to develop it. Or that we could make Einstein more efficient if he had only completed a timesheet. Otherwise, how would we know he was on budget?

With firms like Lavan and others in Australia, true business model innovation is taking place.

By ridding their firms from the hegemony of timesheets, these firms are showing real change is possible, not just lip service about “alternative fee arrangements.”

If you are still are tracking time to justify your firm’s pricing, or to measure the “efficiency of your team,” you are billing by the hour and not doing anything new since timesheets were introduced in 1919 to the legal profession.

You are simply “selling time” just as much as any union employee. The world has changed since 1919.

Real innovation will only come when timesheets are trashed. And Australia may just be ahead of the United States, at least in larger firms.

Congratulations to Lavan Legal, a Trailblazer Firm in the making.

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