Although 75% of corporate legal departments already have, or are developing, outside counsel billing and staffing guidelines, just 6% of these departments believe that their guidelines make outside counsel’s invoices “very easy” for audit or compliance purposes.
That’s according to data collated by Wolters Kluwer’s ELM Solutions, in partnership with Gartner (formerly CEB), the global information technology research and advisory company.
Wolters Kluwer’s ELM Solutions provides enterprise software solutions that facilitate workflow and collaboration across the legal community, connecting corporate legal departments and insurance claims organizations to their trusted law firm partners. The firm says it ran the survey “to collect specific, quantifiable data to help us support the relationship between corporate legal or claims departments and their law firms, while ensuring a high level of guideline compliance,” noting that many corporate legal departments are “looking for actionable insights to guide strategic decisions.”
Unsurprisingly, 75% of respondents agreed that cost control is a primary objective when implementing billing and staffing guidelines, “but relationship-focused goals also remain important,” Wolters Kluwer’s ELM Solutions said. Perhaps more interestingly, only 31% of respondents reported that they are satisfied with outside counsel’s compliance with their guidelines. And none of them were “completely satisfied.”
E-billing systems implement billing guidelines and identify basic compliance infractions, but they are designed work in tandem with human invoice reviewers and are therefore dependent on reviewers for their effectiveness, the company notes.
“While most claims and corporate legal departments have billing guidelines, few are happy with results,” Wolters Kluwer’s ELM Solutions stated in its analysis of the results, available on its website. “Once guidelines and an e-Billing system are in place, many take a detached approach to management and maintenance. It’s understandable. Internal review takes time and is not the reviewer’s only priority, and it is hard to audit effectively and accurately if unfamiliar with the underlying matter or guidelines. When it comes to responding to non-compliance, most don’t want to strain relationships with their firms and prefer to take a hands-off approach.”
The company suggests that if corporate legal departments want to use guidelines more effectively, they should consider engaging with its “LegalVIEW® BillAnalyzer solution. As an extension of your team, our invoice analysis professionals focus on driving your goals and facilitating the change management process for your department and law firms.”
In March this year Wolters Kluwer’s ELM Solutions launched LegalVIEW® BillAnalyzer to help corporate legal departments and insurance claims organizations of all sizes more efficiently manage their incoming legal invoices and improve cost management. The LegalVIEW BillAnalyzer service “manages the entire invoicing review process through a combination of advanced technology, machine learning and expertise to ensure outside firm compliance with billing guidelines”, claiming to offer clients an average cost savings of 6 to 9 percent in legal fees.
The company says LegalVIEW BillAnalyzer provides “consistency and accuracy across all invoices plus continuous improvement through the use of supervised machine learning and natural language processing.” It also provides “detailed, expert driven invoice review for billing guideline compliance and reduced complexity. Meanwhile, its cost management service, with invoices benchmarked against the LegalVIEW® database of over $82 billion in legal spend, provides “visibility to rate and resource planning opportunities. LegalVIEW BillAnalyzer utilizes this database to provide analytics, dashboards and insights.”
Notably, the software also provides outside counsel relationship management. “Our attorneys will work directly with outside counsel to manage the negotiation and billing appeals process. Our team will onboard, educate and advise the outside counsel of best practices to ensure compliance,” the company says.
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