I.T.@Baker & McKenzie
Interoffice Billing on a Global Scale
By Craig Courter
Tracking billable time is one of the most important I.T. tasks any law firm faces. And for multi-office, global law firms, that task can be monumental.
At Baker & McKenzie, a billion dollar firm with more than 3,000 lawyers globally, our attorneys work in more than 60 offices in 35 countries.
As a global firm, our clients take advantage of our dispersed expertise on a variety of matters, especially multi-national matters. But clients usually want a single bill covering all matters -- or at least all the work accomplished in a single matter. This requires time and costs to be transferred from the office which does the work, to the office which bills the client. Each office is the billing office for various matters, complicating this process. Additionally, there is the issue of currency several different currencies are often involved in a single bill compilation.
Historically, this problem was addressed using a manual interoffice time and cost transfer system, which introduced a significant delay and occasional human error. The information was sent via fax, diskette or a somewhat semi-automated process depending upon the sophistication of the legacy system in the office. A "real time" view of matter status and finances was unavailable to clients; and delayed payments were undesirable for the firm.
In 1997 the firm estimated in was losing in excess of $2 million each year as a result of this manual process, both in uncollected time and costs and in delayed billings. So we embarked on a major project to connect working offices around the world with a centrally located billing office, in order to make client account information available in "real time" and to address billing delays.
A Bit of Background
Our international executive office, located in Chicago, includes our international finance division and global information systems division. The I.T. department is divided between 62 local offices, three regional support centers, and a global support center. The regional centers are responsible for the I.T. needs of the offices in each region: Asia Pacific (Hong Kong), Europe, Middle East (London), and Western hemisphere (Chicago). The global support center is responsible for providing support to the regional teams and coordinating I.T. standards for the firm.
We have designated Microsoft products as its standard where available. We use Windows (95 migrating to 2000) and Microsoft Office (97 migrating to 2000) on the desktop, and Windows NT 4.0 for our server environment. Web systems run on Internet Information Services (IIS). Except for our accounting system, databases are mainly SQL 2000 with some legacy applications running on Unix and an AS400. The accounting system is currently running on SQL6.5, with a current project to migrate to SQL 2000.
We decided to build an aggressive, firm-wide integrated system to standardize the billing process and automate the interoffice transfer process. The first task: standardize the time and billing systems and financial management systems across our offices. The second: create a system that automatically transfers certain key data between the offices.
A task group, of six people from different regions in the firm, evaluated software. We looked at CMS OPEN, from Solution 6. We also reviewed Masterpack Integrated Legal Solutions; and Elite for time-and-billing, from Elite Information Systems Inc., of Los Angeles. We looked at the U.K.'s CODA Group for the general ledger.
Our first selection was Elite, for time-and-billing and Coda for general ledger. However, several months into phase one, we determined that Coda would not meet our needs, and went to Elite for both.
Ultimately, Elite was selected as the primary vendor to install accounting software in all offices. We also asked them to develop a program to enhancement their standard software in order to automate the transfer of time and cost entries between offices. The Elite modules we chose were time-and-billing, general ledger and accounts payable. We decided to use Microsoft's SQL replication technology; the platformwas SQL Server Version 6.5.
We first installed the Elite modules in every office in our firm. It was a big project, as we had to take into consideration statutory requirements of all locations.
We expected that the interoffice billing project (dubbed "IOB") would be implemented at the same time as phase one of our standardization of time-and-billing systems and financial management systems. But as the installations started, we realized that there were considerable firm polices and procedures that first had to be addressed before we could successfully install that module.
So the IOB component was put on hold until November 1999, when another team of six members (four consultants and two I.T. staff) lead by project manager Kim Curran, evaluated the program and developed a revised project plan -- including scope, goals and objectives and budget to the firm's technology committee. They identified four components:
Phase 1 consisted of planning and setting up a test environment to re-evaluate the original infrastructure and assure that the program worked in accordance with firm policies and user expectations.
One of the requirements of this project was to be sure all offices (more than 60 offices using 43 databases) were using the same reference data, timekeeper information and client/matter information.
In the past, offices maintained their own "master files." So we knew it would be difficult. We decided to do a comprehensive data conversion to create a global standard master file for client/matters, timekeepers and central reference data.
To get local office "buy-in" to the new system we organized a technical and functional review committee to review the technical infrastructure as well the business requirements of the system.
Next, we converted reference data and timekeeper data and starting data replication between offices for these master files. The team thought it best to phase in the replication process to allow the offices to get used to the process. A phase-in also allowed us to monitor the project and revisit any issues with the infrastructure. We started reference data first because of the hierarchy of the data.
The conversions were done by region and after regular work hours. We had to work different time zones to accommodate our many international offices.
Then data replication was turned on, and offices were communicating with one another! If an office makes a change to the master file, the change is replicated to all offices and their master file is updated.
The next step was to convert timekeepers and start replicating timekeeper data. The same process data conversion was then completed for timekeeper information. The local offices "own" the timekeeper information, so when they make a change, the information is then replicated to all offices' timekeeper master files.
Next: Client/matter conversions. This was more complicated due to the volume, detail, and multi-currencies. When building the master file, it was determined that the billing office was the "owner" of the client/matter.
We thus took all offices' local information and created the global master file. We then took the master file and compared it to the file in the local office to determine what data needed to be converted, usually as a result of different currencies or incorrect client/matter number. Once an office was converted, data replication was turned on.
We performed the 43 conversions within a seven-month period, with up to eight offices at a time. While performing the office conversions, we had a project leader on-site to handle problems and to train users. To complete the conversions in a short time period, we brought in outside consultants from Elite, Baker Robbins & Co., and independents.
Phase three involved the most difficulty. Because we had to bring down the offices for a full week, there wasn't room for surprise.
Once we converted the first few offices, we started having replication backlogs. So we had to slow down our original schedule and evaluate why the backlogs were incurring. We discovered that the architecture needed a bit of tweaking to handle the data replication load of client/matters.
During this phase we made changes to the architecture many times. We worked around the clock to minimize office disruption (and maintain our credibility).
Before we could move to phase four -- replicating the actual billable hours and costs -- we decided to revisit the methodology one more time to prevent any other backlogs, so we pushed back the live date by one month.
Back on Track
Phase four was labeled the "live phase." First, we had to flush the data from the prior manual process from each office's systems, which meant that offices had to transfer their time and cost data within a scheduled time frame as well as perform a month-end close over a two-day period.
We set a strict deadline, and it took considerable amount of effort, cooperation and discipline from each office.
On Sunday, Dec. 3, 2001, at 6 p.m. C.S.T., IOB went live!
First up: the Asia Pacific offices because of the time zone. We decided to isolate other regions until we were sure replication was working properly and the data that was being generated was correct. We encountered a few issues, which we were able to solve immediately.
Once we were reassured that the system was operating properly and that the replication architecture could handle the flow and volume of date we opened up replication to the other regions. Currently, 43 databases are publishing data to one another.
We are still experiencing minor ongoing data issues, but we are monitoring them closely and fixing them as they arise. We are in the process of developing automated monitoring tools to check the data and performance of the system.
Baker & McKenzie will recoup our investment within the first six months of production. Before this program, it took about three months to transfer the time and cost data, now these entries are available upon entry.
By installing this program we cut down the transfer time and the possibility of losing time and cost data.
Craig Courter is chief technology officer at Baker & McKenzie in its international executive offices in Chicago.