KPI bullseye

This post is part of "Metrics that Matter to Small Law Firms," a series of 5 posts. You can start at the beginning or see all posts in the series.

In the final post in this series about key performance indicators (KPIs) for small law firms, we again look outside the legal field to adopt net promoter score (NPS) as a client experience KPI. Satisfied customers that refer other clients ultimately generate more revenue in any business.  Lawyers tend to focus on their experience or what they offer clients, rather than asking the clients for feedback on how the services were received.

Anecdotally, attorneys fear that clients may give ratings based on the outcome rather than the service or experience. However, we are all asked for feedback on our hotel check-in, online shopping purchase, flight and more.

An NPS survey asks existing or former clients how likely they are to recommend your firm to their friends and family or colleagues on a scale of one to ten with ten being “extremely likely” to recommend and one “not at all likely.” A score of nine or ten means that person is a promoter. A score of seven or eight is neutral, which is ignored in the NPS calculation. Six and lower is a detractor.

The survey must not be done anonymously because it needs to allow for follow-up. Also, adding a question—“why would you recommend or not recommend this firm?”— allows you to receive additional feedback, which can be invaluable for changes. Survey Monkey or Google documents can be used to email the survey and follow-up can be done by administrative staff. An Excel spreadsheet can track the firms’ results.

The calculation is simple math. In the example below from my small law KPI book, in one month we reported 9 promoters, 8 neutrals, and 5 detractors. Just subtract the percentage of detractor responses from the percentage of promoter responses and ignore the neutrals.

The number above is a NPS of 18 which intuitively seems low. Please remember that the NPS calculation could be a negative number if detractors exceed promoters. In research done by Inavero, the NPS for the legal industry in 2016 was 23. Remembering that you are working with a possible result from negative 100% to positive 100% helps to put the 18% in perspective.

KPIs are trending now as a way for firms to address their challenges of finding additional clients who demand more for less while the administrative burden of running a firm eats into profits. Start with a few KPIs to measure your firm’s performance and build from there.

If you would like to track your firm’s net promoter score and learn about the other KPIs in this series, here is a free spreadsheet to get you started.

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