Book Review: Ditch The Billable Hour! Implementing Value-Based Pricing in a Law Firm

By Mitch Kowalski

Most legal books - like my favourite martinis - tend to be on the dry side; but what’s great for a martini is quite dreary for readers. Heavy on information, but light on readability may gain critical acclaim but it often results in reduced readership; and if, as F. Scott Fitzgerald is reported to have said, “You don’t write a book to say something. You write it because you have something to say,” what’s the point of writing a book that no one reads? So, I was delighted that Shaun Jardine has done the impossible: written an engaging and comprehensive resource on value-based pricing (VBP); a topic that had a high probability of being an incredibly dull read.

For readers seeking a dense, pedantic tome to sit prominently - and unread - on your bookshelf, Ditch The Billable Hour! Implementing Value-Based Pricing in a Law Firm is not for you; rather, this is a book designed to be tea-stained, dog-eared, highlighted, and folded, with a well-cracked spine and filled with handwritten notes. It’s a practical manual for those who are serious about change from an author who is no stranger to the world of legal pricing; Jardine practiced law for decades, including time as a law firm owner/CEO, and now focuses his time as a law firm management consultant (Big Yellow Penguin) where his clients span the globe; he is part of a very small group of management consultants who are seen by lawyers as truly, “one of us.”

Jardine’s own research is peppered throughout the book, some of which should startle readers; most firms don’t have a Pricing Strategy and Policy that is consistently applied. But, while less than half of the firms he surveyed expected a 10% or more increase in profits in the following year, 77% of those that did, had a clear and consistently applied Pricing Strategy and Vision - and only 21% charged by the hour. Perhaps most astoundingly, 40% of all firms surveyed didn’t even know what proportion of their clients were profitable. Jardine’s research shows that business concepts such as pricing and profitability are ones with which many law firms still require assistance.

Change is hard for lawyers; we’ve been trained to be skeptical and American studies have shown that lawyers consistently rank in the 90th percentile for pessimism. One of Ditch The Billable Hour’s many strengths is its recognition of the challenges and objections that will surface in transitioning to VBP. Jardine doesn’t merely identify these obstacles; he delves deep into them, offering insightful strategies for overcoming resistance and fostering acceptance.

Central to Jardine's message is his easy to understand, 8 P Point Plan (8PPP) framework to facilitate the transition from hourly billing to VBP. The 8 PPP framework was inspired by the methodology and change management teachings of Harvard Business School, Professor John Kotter, and the fable Our Iceberg Is Melting, with each P representing a critical step in this transformative journey:

PARADIGM: the urgency to shift mindsets and undertake a gap analysis for understanding the necessary changes.

PIONEERS: identifying champions to lead the change.

PLAN: A strategic vision for VBP implementation, with practical checklists.

PROMOTE: engaging stakeholders in understanding and supporting the VBP initiative.

PERMIT: empowering individuals and teams to drive change.

PRIZES: capitalizing on early successes to build momentum for the VBP shift.

PERSEVERE: strategies for maintaining enthusiasm and overcoming challenges in the VBP journey.

PASSION: Cultivating a long-lasting commitment to VBP within the firm.

This disciplined approach provides a clear,

logical, and understandable roadmap for all legal services entities transitioning to VBP.

As previously mentioned, accessibility and practicality are at the heart of Ditch The Billable Hour! It’s fun, conversational style is concise, engaging, and persuasive, weaving together cartoons, side bars, practical scenarios, research, expert commentary, and exercises, along with strategic advice. This multifaceted and multi-media approach not only allows readers to dip in and out of the book as needed, but it also caters to the 21st Century learning styles of new generations. More legal services books need to be written in this way!

Ditch The Billable Hour! also serves as a gateway to further exploration by providing numerous links to additional reading and resources from respected experts and thought leaders for readers wishing to be more deeply immersed into legal practice management and change management matters.

As we all know, the death of the billable hour has been great exaggerated for nearly 2 decades, however the rapid pace of technological change in legal services is bringing us ever closer to the moment where lawyers realize that hourly billing makes them less money than VBP. And when that moment finally arrives, those who prepared for it will fare much better than those who did not. Creating or changing a pricing strategy is not something to be done over a weekend retreat - as Shaun Jardine demonstrates in his book, change is a disciplined and time-consuming process and so the earlier it begins, the better. But even if the billable hour lingers in its death throes for many more years to come, Ditch the Billable Hour! will remain as a significant contribution to the literature on legal services pricing.

About the Author

Mitch Kowalski  is a lawyer and Visiting Professor of Legal Innovation at the University of Calgary Law School, a Fastcase 50 Global Legal Innovator, a Fellow to the College of Law Practice Management, and the author of the critically acclaimed books, Avoiding Extinction: Reimagining Legal Services for the 21st Century, and The Great Legal Reformation: Notes from the Field. He was awarded the Ontario Bar Association President's Award for "Leadership in Justice innovation," and is often hired by law firms around the world in connection with their innovation efforts. Follow him on X @mekowalski or visit his website www.kowalski.ca