Debt recovery is likely to be viewed by some legal practices as a side hustle to the real main aspects of the game – practising law and making sure the areas of law they practise, have real meaning and deliver good for clients.

That is not to say making sure people get paid for the work they do is of any less valuable.

However, the time has come to change the paradigm of engagement where law firms should be looking at introducing technology that can be used to assist and advise businesses, on engagement contracts via independently single focussed software platforms that help protect clients from incurring bad debts.

Personal experience often motivates change, and had it not been for a $400,000 debt incurred by two software engineers, law firms would not now be in the position to use technology to advise small business operators on software that works to mitigate client exposure to bad debt.

Using sophisticated software technology now becomes a form of insurance – a barometer that weeds out businesses inclined to renege on paying contractors for work conducted.

Knowing where landmines are located before venturing into dangerous territory that identifies a problem before it even begins is always a bonus.

It’s the advantage of eliminating a problem and never allowing it to develop that adds to the appeal of the strategy rather than resorting to lawyers in a battle that should never really occur. An expectation to be paid for work delivered is not an unreasonable request.

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And with new software technology that creates opportunity for service providers to make money and increases fairness that removes uncertainty is always the goal of any business.

But chasing debts is a practice law firms would rather not have to do – recouping small debts is a winner for small clients but not the sexy aspects of law lawyers signed up to do a five-year degree for. 

Personal losses are all relative, which makes sole traders and freelancers part of a $40 billion loss-making industry that has devastating effects on those who live by the basis of faith and trust and banking on clients doing the right thing.

Software technology and how it is used, should have small business operators lining up to make contract platforms an effective part of their business and how they operate that allows for: 

1. Milestones where larger bodies of work delivered in one lot with payment terms attached upfront or on delivery.
2. Where deliverables of individual components are completed as agreed to with the client.
3. An acceptance criteria where each deliverable is needed to have a clear definition of completion.
4. Exclusions – specific areas of ambiguity that were agreed upon to be left out of the terms.

But a software platform that manages running a successful project and delivers clients benefits by saving time is a viable investment.

As for lawyers and law firms, software platforms that allow them to unlock the shackles that have handcuffed them for so long to a part of a business generally considered boring and not profitable, just may be the freedom they crave.

Ryan Handby is the chief executive and co-founder of MilestonePay.