What To Do About Falling Realization Rates

Are your firm's realization rates declining? If so, most firms are in the same boat. According to the 2016 Report on the State of the Legal Market from Georgetown University Law Center and Thomson Reuters Peer Monitor, the average firm's billing realization rate fell from 94% to 87% over the past ten years. Collected realization fell from 93% to 83% during the same period.

Setting a goal of 100% realization is not realistic. However, you should be able to keep your rate above 90% with a concerted effort.

Do Not Make Write-Offs Routine

Poor realization is a problem that begins long before you bill clients. While write-offs are sometimes necessary, such as promising a discount to a client, they should not be routine.