When the unstoppable force of AI meets the immovable object of the billable hour... The OpenAIs and Anthropics of this world are moving away from all you can eat subscription pricing to subscription + token usage, or just straight up token pricing - and this emerging pricing model is now far more compatible with traditional hourly rate billing Yes - fixed fees and value based pricing better etc etc. My observation here is a practical, rather than ideological, one But the path

Something I'm finding increasingly baffling with AI - why are all the law firms parroting 'efficiency' as the primary benefit? [law firm] announces major partnership and rollout of [product] following successful pilot with [x] hours saved per week Where are the improvements to quality or scope? Where are the improvements to speed or turnaround times? To only publicly talk about efficiency is to immediately beg the question on fees - and increasingly I see clients asking for d

Today, on "this time it might just be different"... Increasingly it seems to me that there is a particular type of practice that is particularly exposed to AI in the short to medium term It's not the consumer, or the SME business owner having a go with ChatGPT - I don't think many of those folks were paying clients in the first place (and I suspect they're creating more legal work in the long run!) Rather it is the larger corporate buyer that has historically bought in modera

Not only do I expect both KPMG and Grant Thornton's own clients to be pressing for a 14% discount on audit fees, in light of this article I also expect every audit partner in every firm across the country to be starting next year's fee negotiation from a much weaker - 'where's the 14% AI saving' rather than the more traditional 'well it's been another tough year for inflation and we need to pass that through' This highlights an important issue when it comes to pricing, partic

Conversations around Value Based Pricing are often framed in a comic book casting of good (VBP) vs evil (Cost Based Pricing / CBP) But it's not an either/or, and it's an incomplete picture Cost and perceived value set the parameters of what a price can be, but they don't define what the price ultimately is Unless you're a VC backed SaaS company burning other people's money, the price a client pays does generally need to be higher than your cost to deliver the service In profe

Value Based Pricing (VBP) is being sold to law firms as a silver bullet to increase prices, whereas it is being sold to clients as a silver bullet to reduce spend Contrast the following real, but non-attributed, quotes: "Adopt and implement value-based pricing models for your in-house legal counsel. Reduce costs based on outcomes and not hours" With "Increased profitability. Firms can capture genuine value for the results they deliver" Both can be correct, but this is... a di

Pricing is our penultimate session in The Legal Mini-MBA, partly because of the alliteration, but mainly because there's some hard yards to cover before we get to it What are you trying to achieve, what sort of clients are you targeting and what services are you offering all need considering before working out how to price those services, for those clients, and to meet those aims Reflecting on the conversations in the pricing sessions over the past couple of weeks, most group

BigHand 's 2025 Pricing and Budgeting Survey is a worthwhile read, and timely for our current Legal Mini-MBA delegates who are wrapping up our lesson on Pricing this week! I normally expect the march of progress to head in one direction in these sorts of surveys, but there's one area in particular that stands out... Clients want greater visibility over fees (p8), but firms are offering less of it (p16) I can't help but (perhaps unfairly) draw a link between less visibility he

We cover Service Propositions (i.e. what do you offer your clients) in the fourth live session of the Legal Mini-MBA We spend some time discussing the trade-offs between offering bespoke vs standardised services drawing from Corporate M&A, FinReg and checks notes fast food… Rather than pit bespoke vs standardised as a binary either/or choice, we introduce some nuance – illustrating tailored, modular and segmented approaches in between the two extremes This is a model based u

When it comes to structural shifts, law firms tend exhibit herd-like behaviours which, rather than be a criticism, I attribute to...

Garfield AI has captured the attention of many, including me, for offering businesses the ability to pursue unpaid invoices of up to...

Interesting report coming out of Bucerius Law School and Simon-Kucher looking at the impact of GenAI on law firm business models last...

One of the questions left open in The Law Society 's Financial Management Survey is that of effective rates, or price achieved by...

Supply and demand curves are a cornerstone of Economics 101 classes and they're typically introduced as a simple straight line (as shown...

Betteridge suggests no... To take a worked example - if a lawyer works 20 hours on a matter and charges £500 an hour, then they bill the...

Elsewhere I've advocated for pricing a given piece of legal work in three distinct ways, with reference to: The cost of delivering said...

Earlier this week I posted about the billable hour maybe not being all that bad, when viewed in the context of the other factors that...

Couple of posts this week testing the "billable hour = bad / value based pricing = good" narrative I'll say up front that my view is...

Within my earlier post this week on the latest data release from the ONS on Legal Services prices I referenced BigHand 's 2025 Law Firm...

Background The UK Office for National Statistics (ONS) produces a quarterly Services Producer Price Index (SPPI). This contains useful...