Legal operations glossary
The terms of legal operations, each defined once, in plain words.
- AI governance
- The rules, roles and checks that decide how AI is used safely.Read the guideAI strategy and governance
- Alternative fee arrangement (AFA)
- Any price that is not hours times rate: fixed, capped, success or subscription fees.Capacity, data and KPIs
- Billing guidelines
- A client's written rules for what a firm may bill and how.Read the guideCapacity, data and KPIs
- Clause library
- Approved contract clauses with fallbacks and guidance, reused instead of redrafted.Knowledge management
- Client experience
- What working with a firm feels like to its clients, from first contact to invoice.Client experience and retention
- CLM (contract lifecycle management)
- The systems and process that take a contract from request to signature, storage, obligations and renewal.Knowledge management
- Debtor days
- The average number of days invoices stay unpaid: invoices sent but unpaid ÷ annual fees billed × 365. For example, a firm that bills €3,650,000 a year and has €400,000 of unpaid invoices has 40 debtor days. Debtor days are the second half of lockup; WIP days are the first.Read the guideCapacity, data and KPIs
- Intake and triage
- The single route by which requests reach a legal team, and the rules that size, prioritize and assign them.Matter management and intake
- Kanban
- A board that shows work in progress by stage, limiting how much runs at once.Process and workflow design
- Knowledge management
- Making the firm's best work findable and reusable.Knowledge management
- Legal design
- Applying design methods to legal documents and services so they are easier to understand and use.Client experience and retention
- Legal operations (legal ops)
- The design, measurement and improvement of how legal work is done: process, people, data and technology.Read the guideLegal Operations
- Legal project management (LPM)
- Planning, scoping, budgeting and running legal matters as projects, with a scope, a plan and a budget agreed at the start.Process and workflow design
- Lockup
- The days between doing the work and being paid: WIP days plus debtor days. For example, a firm that bills €3,650,000 a year, with €600,000 in WIP and €400,000 in unpaid invoices, has 60 WIP days and 40 debtor days: 100 days of lockup. Each of those days is fee income the firm has earned but not yet banked, so lockup shows how much cash the firm is financing for its clients.Read the guideCapacity, data and KPIs
- Matter management
- Keeping every matter's status, owner, deadlines, documents and costs in one system.Matter management and intake
- Outside counsel spend
- What an in-house legal team pays external law firms.Read the guideCapacity, data and KPIs
- Realization
- The share of the value of recorded time that is billed, and of that, the share that is collected. Billing realization is value billed ÷ value of time recorded at standard rates; collection realization is cash collected ÷ value billed; overall realization is cash collected ÷ value of time recorded. For example, time worth €100,000 at standard rates, billed at €85,000 and collected at €80,000, gives 85% billing, 94% collection and 80% overall realization. A firm can have high utilization and low realization at the same time.Read the guideCapacity, data and KPIs
- Utilization
- Billable hours recorded divided by the hours a fee earner is expected to bill. Agree the denominator first: an annual target, the hours left after leave, or a fixed standard. For example, a fee earner expected to bill 1,500 hours who records 1,200 is at 80%. Utilization counts time recorded, whether or not it is billed later; what survives billing is realization.Read the guideCapacity, data and KPIs
- WIP (work in progress)
- Time and expenses recorded but not yet billed, at standard value. WIP days state it as days of fee income: WIP ÷ annual fees billed × 365. For example, a firm that bills €3,650,000 a year and holds €600,000 of unbilled WIP has 60 WIP days. WIP that keeps growing on a matter usually means billing waits for the end of the matter.Read the guideCapacity, data and KPIs
- Write-off
- Recorded value that is never billed or never collected.Read the guideCapacity, data and KPIs
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