Time & Billing

Pitching E-Billing to Decision Makers

By Jeff Hodges

MOST corporate legal departments spend more than half of their budgets on outside counsel, according to a recent survey of U.S. law departments conducted by PricewaterhouseCoopers L.L.P.

Surprisingly, in an age of unprecedented ability to capture and analyze business data, many general counsel don't use those resources to evaluate the quantity, quality and distribution of outside work.

E-billing -- the electronic delivery, validation, reconciliation, routing and approval of legal invoices -- can help corporate law departments do just that: evaluate, understand -- and better manage -- outside counsel. E-billing systems streamline the processing of invoices, and allow invoices to be checked against pre-established guidelines or policies.

They also can save a lot of money. The average cost of processing a traditional legal invoice is $10 per page, but moving to an e-billing system can reduce per-page cost to a mere 90 cents, says Deloitte & Touche L.L.P.

But we all know that "pitching" a new technology can be a challenge. So here are 12 points to make to help you win over your decisionmakers.

1. Invoices arrive in a predictable electronic format.

2. Invoices are delivered electronically via secure, encryption-protected e-mail.

3. Invoices show up ready for processing in the corporation's system of choice.

4. The American Bar Association-approved Uniform Task-Based Management Standard codes can be incorporated into the process. This simplifies billing and provides consistency among outside counsel. That consistency helps GCs compare performance.

5. Invoices are checked against corporate legal's matter information and outside counsel guidelines before they arrive. When errors occur, they are rejected before the corporation receives it (along with instructions back to the firm about how to correct the invoices.)

6. Invoices are tagged with warnings and exceptions, allowing reviewers and handlers to deal with them separately.

7. Invoices are delivered to the desktop of the right approver in the right order.

8. Invoices are pushed to approval and payment using electronic workflow tools.

9. Negotiation of bill adjustments with counsel is virtually eliminated.

10. Approval authorities are managed automatically.

11. Invoices are electronically delivered to accounts payable immediately after approval.

12. Reporting functions allow creation of day-to-day reports centering on the needs of specific users, and can help managers evaluate and control costs and allocations, as well as chart progress against plans.

The strategic value of the information delivered by e-billing systems cannot be understated. What is it that is in the legal invoice that gives it such strategic value? Insight! Strategy is nothing more than a plan for the future based on information about the past and present. The value of a company's strategy is directly proportional to the quality of its information.

Well-developed e-billing systems provide tangible data of far more use than the traditional "for services rendered" paper bill. Armed with electronic and standardized entries of lawyer time, rates, work type and descriptions, corporate counsel can analyze data from thousands of invoices and all of their outside counsel to discover patterns, practices, value and economies.

Houston's Jeff Hodge is vice president, business development, of DataCert Inc.