1. 1 Managing your L&D Budget LETG Conference 14 November 2008 Robert Mowbray MacIntyre Hudson LLP

2. 2 The “Perfect Storm” nFalling Demand nRampant Inflation nCredit Crunch N.B. Has this happened before?

3. 3 Economic Impact on Profit…. With 5% cost Inflation Last 10%20% YearFee DropFee Drop £’000£’000£’000 Fees560504448 Expenses(420)(441)(441) Profit140 63 7

4. 4 Training: Strategic Investment or Annual Cost? More Time For Training…… But Training Budget Cut!!

5. 5 Are you spending the right amount? LETG SurveyLETG Survey 2000-20052008 Spendable budget as % age of annual fees0.63%0.76% Spendable training budget per fee earner£1,083 Spendable budget and salaries of training staff per fee earner£1,635 Spendable budget and salaries of training staff as % age of annual fees0.95%1.12% N.B. LMS Survey 0.8%

6. 6 Other Measures of cost nPer fee earner nPer CPD hour nPer support staff nPer support staff hour

7. 7 Controlling Expenses: Short term Discretionary v Fixed Rephasing of Budget?

8. 8 Other short term strategies ….cost savings nBetter attendance nLarger class sizes nMore “in house” use nVideos and “replay” nRenegotiate with suppliers nDefer training to later period

9. 9 Longer term cost control List of expenses v List of services Cost of each service Outsource/control cost Reduce service in consultation with fee earners

10. 10 Budgeting for services ServiceCost £Outsourced ProfitCompulsory Value added £loss/£ PSC 10 14 4Yes Support staff 15 17 2No Money Laundering 8 6 (2)Yes 33 37 4 Which service does the fee earner want to be cut?

11. 11 Training “Return” possible measures other than “happy sheets” Type of trainingPossible Measure Legal knowledgeTest pre, post & post post AccountsTest pre, post & post post ComplaintsNumber of complaints received Time RecordingNumber of missing time sheets Actual hours – pre, post & post post Time ManagementAppraisals? LeadershipAppraisals?

12. 12 Training: Incentivise the trainer! “ If it can be done for fee earners why not trainers!!”

13. 13 Pricing Legal Services Time Spent Fixed Price Value Based So, what about training services?

14. 14 ANY QUESTIONS? Do you want to do the LETG survey again?

15. 15 Disclaimer & Copyright The views expressed in this material do not necessarily represent the official views of the course organiser, MacIntyre Hudson LLP or its associated companies. No responsibility for loss occasioned to any person's action or refraining from action as a result of reliance upon any information in the material can be accepted by the course organiser, speakers, other contributors, or The MacIntyre Hudson Group. Legislation, case law, tax practice and accounting and auditing standards are complicated and these course notes should not be regarded as offering a complete explanation of every topic covered These papers are for the personal use of those attending the seminar. Copyright is reserved to MacIntyre Hudson LLP and to its associated companies and this material may not be circulated, reproduced or published in whole or in part without the written consent of MacIntyre Hudson LLP. Where indicated, material may be subject to Crown Copyright protection. It may be reproduced free of charge provided that it is reproduced accurately and that the source and copyright status of the material is made evident to users.