BigHand, a legal tech software provider, recently released a Survey and Report entitled Navigating the Million Dollar Problem, Resource management for Profitability, Client and Talent Retention. The report is based on responses from over 800 law firm leaders and professionals across firms with 50 or more lawyers.
The report confirms what I have heard over and over again from lawyers, particularly at smaller and midsize law firms: they simply can’t find good quality associates, and when they do, they frequently leave for perceived greener pastures. BigHand believes, and I agree, that one solution is to better utilize the associates that you have. And that comes down, in part, to better resource allocation. As BigHand puts it, it’s a $1 million problem.
BigHand is selling a resource management tool that purportedly solves that problem.
Some Numbers
But first, some numbers from the report that reflect the resource allocation problem and paint a stark picture:
- 43% of assignment decisions are made by lawyers, and 37% are based on personal preference over merit.
- 45% of the firms surveyed report they only have partial data on the capacity and utilization of their associates.
- Only 40% have partial data on the work allocated from partners to associates.
Many firms are essentially resourcing in the dark.
The Clients
Eighty-six percent of the firms surveyed reported that client demand had increased over the last year. At the same time, despite the increased demand, 40% said clients are reducing their spend, 38% are reducing the number of firms that they use, and 30% of the firms believed clients had found cheaper alternatives. Most law firms surveyed reported client attrition in the last 12 months.
In short, there are tremendous opportunities for firms that can meet client demand. And one way to help do that is to retain and appropriately utilize associates.
The Associates
So, what about the associates? It’s not pretty. The number of associates leaving the profession has almost doubled in the last 12 months from 9% in 2024 to 17% in 2025.
The main reason for associates’ departure is the desire for hybrid working and better work-life balance. Other factors include a lack of professional development as well as concerns over salary. According to the report, more associates are moving in-house than ever.
And clearly, when an associate leaves, it disrupts the quality of service. It increases the workload for the remaining staff. It increases recruiting and training costs, not to mention the loss of institutional and cultural knowledge.
BigHand estimates that the cost of losing a third-year associate exceeds $1,000,000, even before considering the impact on other lawyers and client relationships. Thus, trying to reduce attrition is crucial for these reasons alone.
And 33% of the firms surveyed are planning to reduce equity partners.
So, not surprisingly, 40% of the firms surveyed want to increase senior associate levels in the next year.
A Perfect Storm
It sounds like a perfect storm: more work available from clients, increased competition with emphasis on efficiency, fewer partners, and unhappy associates leaving in droves. No wonder law firm leaders keep wailing about not having quality associates to do the work.
So, what are law firms doing? Based on the Survey, not much. Instead, they’re relying on lawyers’ gut instincts about associate quality, instincts that are often wrong.
Why Use Data to Allocate Resources?
I know from experience that many resource allocation decisions in law firms are made based on a partner’s perceived abilities and qualities of associates, which are often not entirely correct.
This inevitably results in underutilized associates on one hand and overutilized associates on the other. The overutilized associates quickly become burned out and chafe at the unfairness of the system. The underutilized associate, on the other hand, worries constantly about their development and future at the firm. And perhaps they should.
A more data-driven allocation method might result in utilization on a more accurate and fairer basis and alleviate the stress of too much or too little work, stress that drives associates to leave and costs firms dearly.
Dave Cook, BigHand’s Global Director – Resource Management, agrees: “Partner-led resourcing with no data visibility leads to some associates being overloaded with work while others are underutilized, slowing their development and limiting growth opportunities.”
And There’s More
In addition to relieving associate utilization stress, there are other reasons for better allocation. For example, much of what is perceived associate quality is based on little more than reputation.
I remember a situation when I was a partner with an associate who had the reputation of being underperforming. The firm was this close to firing the associate when another partner took the associate under their wing and moved them from the section in which they were working to another completely different section where that partner could mentor the associate. That associate later became an equity partner and had some of the highest origination of any lawyer in the firm.
That, of course, occurred by pure happenstance. But if there were data-driven resources that could help determine where the needs were and match those needs with the skill set of associates, keeping in mind that, as the associate I referred to, many have different skill sets that are suited to different types of practice.
A closer look at utilization could help solve both problems and decrease attrition. It might also detect quality issues that need to be addressed with an associate before it becomes such a significant problem as in the example that I provided.
And let’s face facts. Not using data to drive work assignments and instead letting the lawyer do it themselves often mean lawyers assigning work to people that look like them and come from similar backgrounds. Since most assigning lawyers are white male partners, you get an inevitably unfair result. In turn, the firm loses what could be an excellent lawyer.
Cook puts it this way: lawyer-based assignment “also opens the door to all kinds of bias. Work is rarely ever equitably allocated, leading to frustration, and sometimes departures, from talent that would otherwise help the firm succeed.”
The associate in my example, by the way? A black female.
So, Why Not?
So, why aren’t firms using a data-driven approach to allocating work to associates? As the report points out, robust resource allocation is not something that lawyers without data are good at, and it takes away from billable time. Yet they keep insisting on doing it themselves.
That’s because most partners want the freedom to utilize their favorite associates. They perceive themselves as special snowflakes with the unique ability to spot and develop talent. They believe that, instead of data, their “gut instinct” is the most valid determining factor. They believe that their work is so important that only the best associates can work on it. And they aren’t going to give up that control.
Secondly, too many partners are unwilling to delegate the allocation of their work to a data-driven platform and personnel who are not lawyers. The idea is that this is my practice, this is my law firm, and you work for me – so butt out. I’ve seen this hubris repeatedly, especially from senior partners who’ve never had or wanted to justify their resource decisions with data.
Moreover, rather than looking hard at career development and addressing problems before they get too large, too many partners are too focused on billable hours and client origination to worry about the development of associates, the lifeblood for the future of the law firm.
Conclusion
So even though data-driven resource allocation reduces associate attrition at a time when more not fewer are needed, reduces cost and disruption, and may indirectly lead to better partners, firms are slow to embrace it.
But BigHand is right; to compete effectively for new work and keep the clients and associates you have, resources need to be appropriately allocated to the right levels based upon profitability, hourly rates, and efficiencies. The best way to do that is not by gut instinct but by data and analytics.
While I can’t verify all of BigHand’s findings, the core problems they identify align with what I’ve observed repeatedly.
Does BigHand’s resource management tool better allocate work? I couldn’t tell you that either. But data-driven resource allocation is the right idea at the right time.
Stephen Embry is a lawyer, speaker, blogger, and writer. He publishes TechLaw Crossroads, a blog devoted to the examination of the tension between technology, the law, and the practice of law.
The post Data-Driven Law Firm Resource Allocation: An Idea Whose Time Has Come appeared first on Above the Law.
BigHand, a legal tech software provider, recently released a Survey and Report entitled Navigating the Million Dollar Problem, Resource management for Profitability, Client and Talent Retention. The report is based on responses from over 800 law firm leaders and professionals across firms with 50 or more lawyers.
The report confirms what I have heard over and over again from lawyers, particularly at smaller and midsize law firms: they simply can’t find good quality associates, and when they do, they frequently leave for perceived greener pastures. BigHand believes, and I agree, that one solution is to better utilize the associates that you have. And that comes down, in part, to better resource allocation. As BigHand puts it, it’s a $1 million problem.
BigHand is selling a resource management tool that purportedly solves that problem.
Some Numbers
But first, some numbers from the report that reflect the resource allocation problem and paint a stark picture:
- 43% of assignment decisions are made by lawyers, and 37% are based on personal preference over merit.
- 45% of the firms surveyed report they only have partial data on the capacity and utilization of their associates.
- Only 40% have partial data on the work allocated from partners to associates.
Many firms are essentially resourcing in the dark.
The Clients
Eighty-six percent of the firms surveyed reported that client demand had increased over the last year. At the same time, despite the increased demand, 40% said clients are reducing their spend, 38% are reducing the number of firms that they use, and 30% of the firms believed clients had found cheaper alternatives. Most law firms surveyed reported client attrition in the last 12 months.
In short, there are tremendous opportunities for firms that can meet client demand. And one way to help do that is to retain and appropriately utilize associates.
The Associates
So, what about the associates? It’s not pretty. The number of associates leaving the profession has almost doubled in the last 12 months from 9% in 2024 to 17% in 2025.
The main reason for associates’ departure is the desire for hybrid working and better work-life balance. Other factors include a lack of professional development as well as concerns over salary. According to the report, more associates are moving in-house than ever.
And clearly, when an associate leaves, it disrupts the quality of service. It increases the workload for the remaining staff. It increases recruiting and training costs, not to mention the loss of institutional and cultural knowledge.
BigHand estimates that the cost of losing a third-year associate exceeds $1,000,000, even before considering the impact on other lawyers and client relationships. Thus, trying to reduce attrition is crucial for these reasons alone.
And 33% of the firms surveyed are planning to reduce equity partners.
So, not surprisingly, 40% of the firms surveyed want to increase senior associate levels in the next year.
A Perfect Storm
It sounds like a perfect storm: more work available from clients, increased competition with emphasis on efficiency, fewer partners, and unhappy associates leaving in droves. No wonder law firm leaders keep wailing about not having quality associates to do the work.
So, what are law firms doing? Based on the Survey, not much. Instead, they’re relying on lawyers’ gut instincts about associate quality, instincts that are often wrong.
Why Use Data to Allocate Resources?
I know from experience that many resource allocation decisions in law firms are made based on a partner’s perceived abilities and qualities of associates, which are often not entirely correct.
This inevitably results in underutilized associates on one hand and overutilized associates on the other. The overutilized associates quickly become burned out and chafe at the unfairness of the system. The underutilized associate, on the other hand, worries constantly about their development and future at the firm. And perhaps they should.
A more data-driven allocation method might result in utilization on a more accurate and fairer basis and alleviate the stress of too much or too little work, stress that drives associates to leave and costs firms dearly.
Dave Cook, BigHand’s Global Director – Resource Management, agrees: “Partner-led resourcing with no data visibility leads to some associates being overloaded with work while others are underutilized, slowing their development and limiting growth opportunities.”
And There’s More
In addition to relieving associate utilization stress, there are other reasons for better allocation. For example, much of what is perceived associate quality is based on little more than reputation.
I remember a situation when I was a partner with an associate who had the reputation of being underperforming. The firm was this close to firing the associate when another partner took the associate under their wing and moved them from the section in which they were working to another completely different section where that partner could mentor the associate. That associate later became an equity partner and had some of the highest origination of any lawyer in the firm.
That, of course, occurred by pure happenstance. But if there were data-driven resources that could help determine where the needs were and match those needs with the skill set of associates, keeping in mind that, as the associate I referred to, many have different skill sets that are suited to different types of practice.
A closer look at utilization could help solve both problems and decrease attrition. It might also detect quality issues that need to be addressed with an associate before it becomes such a significant problem as in the example that I provided.
And let’s face facts. Not using data to drive work assignments and instead letting the lawyer do it themselves often mean lawyers assigning work to people that look like them and come from similar backgrounds. Since most assigning lawyers are white male partners, you get an inevitably unfair result. In turn, the firm loses what could be an excellent lawyer.
Cook puts it this way: lawyer-based assignment “also opens the door to all kinds of bias. Work is rarely ever equitably allocated, leading to frustration, and sometimes departures, from talent that would otherwise help the firm succeed.”
The associate in my example, by the way? A black female.
So, Why Not?
So, why aren’t firms using a data-driven approach to allocating work to associates? As the report points out, robust resource allocation is not something that lawyers without data are good at, and it takes away from billable time. Yet they keep insisting on doing it themselves.
That’s because most partners want the freedom to utilize their favorite associates. They perceive themselves as special snowflakes with the unique ability to spot and develop talent. They believe that, instead of data, their “gut instinct” is the most valid determining factor. They believe that their work is so important that only the best associates can work on it. And they aren’t going to give up that control.
Secondly, too many partners are unwilling to delegate the allocation of their work to a data-driven platform and personnel who are not lawyers. The idea is that this is my practice, this is my law firm, and you work for me – so butt out. I’ve seen this hubris repeatedly, especially from senior partners who’ve never had or wanted to justify their resource decisions with data.
Moreover, rather than looking hard at career development and addressing problems before they get too large, too many partners are too focused on billable hours and client origination to worry about the development of associates, the lifeblood for the future of the law firm.
Conclusion
So even though data-driven resource allocation reduces associate attrition at a time when more not fewer are needed, reduces cost and disruption, and may indirectly lead to better partners, firms are slow to embrace it.
But BigHand is right; to compete effectively for new work and keep the clients and associates you have, resources need to be appropriately allocated to the right levels based upon profitability, hourly rates, and efficiencies. The best way to do that is not by gut instinct but by data and analytics.
While I can’t verify all of BigHand’s findings, the core problems they identify align with what I’ve observed repeatedly.
Does BigHand’s resource management tool better allocate work? I couldn’t tell you that either. But data-driven resource allocation is the right idea at the right time.
Stephen Embry is a lawyer, speaker, blogger, and writer. He publishes TechLaw Crossroads, a blog devoted to the examination of the tension between technology, the law, and the practice of law.
The post Data-Driven Law Firm Resource Allocation: An Idea Whose Time Has Come appeared first on Above the Law.
