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Facilitator Guide

Economics of Litigation vs. Transactional Work

What’s covered

  • Fee structures and billing practices
  • Billing and collection cycles
  • Revenue predictability
  • Staffing leverage and rhythm
  • Hard costs and disbursements
  • Write-offs and write-downs
  • Economic cycles, practice volatility, and balance sheet risk
  • Client relationship dynamics and cross-selling

Before the session

Prepare the Attendees

Send the attendees an invitation for the session. Include this link, which has the videos and exercise they’ll need to prepare.

https://www.hotshotlegal.com/discussions/economics-of-litigation-vs-transactional-work/attendee

Prepare Yourself

Watch the videos and read the exercise so you’re familiar with the Hotshot material.

  • still frame from Economics of Litigation vs. Transactional Work

    Course

    Economics of Litigation vs. Transactional Work

    A comparison of the business models underlying litigation and transactional practices. Covers how each practice generates revenue, structures fees, manages staffing and costs, handles client relationships, and responds to economic cycles.

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    Exercise

    PDF

During the session

Part 1: Knowledge Check

 

Ask attendees these questions to ensure they understand the topic:


  • What are the main differences between how transactional and litigation practices structure their fees?
  • How does WIP differ between transactional and litigation practices?
  • Why is transactional work described as pro-cyclical and litigation as counter-cyclical?
  • What are some hard costs associated with litigation matters that typically don't appear in transactional work?
  • How do client relationship dynamics differ between transactional and litigation practices?
  • How do the two practices leverage associates differently?
  • What balance sheet risks does each practice carry for the firm?
  • Why do transactional practices typically have better cross-selling opportunities than litigation practices?

 

Part 2: Group Exercise

 

Lead a group discussion based on the exercise. To encourage collaboration, divide the attendees into groups to discuss the exercise, then have a representative from each group summarize their views to the larger group. Call on people to share their thoughts and ask others to respond.

 

Tip for remote sessions: use your web conferencing system's breakout room feature to divide people into groups.

 

Part 3: War Stories and Firm Specifics

 

Share your own experiences and guidance, including:

 

  • Anecdotes and war stories (e.g., about a near-disaster or a tough negotiation)
  • General practice tips (dos and don'ts)
  • Firm-specific guidance and practices

After the session

To continue learning, attendees can check out related courses in Hotshot’s Business of Law topic.