ebilling best practices and readiness: from angst to...

eBilling Best Practices and Readiness: From Angst to Assurance

Mary Jummati UnitedLex April 2017

UnitedLex Law Department Consulting

To discuss best practices for obtaining the most value from investment in eBilling technology. This includes:

2

Objective

Value Contribution

of Investment in eBilling

Billing Guidelines

Electronic Invoicing

Review and Approval

Budgeting Philosophy, Criteria, and

Initiation


Save time and resources through utilization of eBilling technology ü  Automatic enforcement of billing guidelines ü  Increased collaboration between external vendors and the Law Department ü  Transparency in financial information through budgeting, accruals, and data

obtained by electronic invoicing Additional benefits include: ü  Increased financial privacy and security at both an internal and external

level ü  Ability to run reports by various spend categories ü  Realized cost savings in annual outside legal spend ü  Data-driven decision-making

3

Overview

eBilling Technology enables Law Department team members to focus on higher value work, ultimately leading to a more efficient Law Department.

UnitedLex Law Department Consulting 4

Value Contribution Framework Rationalizing the internal and external effort spent on various types of work facilitates a value and risk-based strategy that ensures the right resources are doing the right work. Spending valuable time on reviewing and approving invoices, creating and maintaining budgets, and ensuring vendors are compliant with billing guidelines likely falls into the red category. Automating this through the use of eBilling technology frees up time for Law Department resources to spend on higher value work.

Eliminate/Reduce Automate Outsource

Internal Resources Outsource

Low

High

High Low Strategic Alignment

Ris

k Po

tent

ial

Internal Resources Automate Outsource

Source: Association of Corporate Counsel InfoPak – “Strategic Planning: Why a Plan is Needed & How to Develop One”, authored by Nancy Jessen


•  Guidelines should be reviewed on a regular basis (e.g., annually) and updated, as needed

•  Do not include any terms you are not prepared to enforce •  If you’ve invested in an eBilling system, make use of eBilling system

requirements and utilize system rules to enforce or flag violations of rules •  eBilling systems are able to automatically review invoices as the first step in

the approval process. Utilize these capabilities and state them in your Billing Guidelines

–  If there is reluctance to enforce these rules right away, start by flagging or warning violations so law firms/vendors can become aware of the rules

•  Require firms and vendors to acknowledge receipt and agreement with guidelines

•  Current trend is addition of Privacy and Cyber Security/Information Protection requirements (collaborate with IT on these sections)

5

Billing Guidelines Best Practices


Regardless of the Law Department or the eBilling tool that is selected, below are a list of quick-hitting audit rules that can be implemented for immediate cost savings.

6

Billing Guidelines

Recommended Use for Standard Invoice Audit Rules Recommended

Action

1 Timekeeper rate exceeds agreed upon rates Write-down

2 Expense charge exceeds acceptable unit cost (e.g., charged photocopy expenses) Write-down

3 Do not allow more than one matter per invoice Reject

4 Timekeeper billed too much time (e.g., >12 hours per day) Warn

5 Invoice line items are too old (e.g., >90 days) Warn

6 Invoice date is too old (e.g., >90 days) Reject

7 Invoice has duplicate timekeeper charges (based on date, matter, timekeeper, task, hours) Warn

8 Invoice contains duplicate expense (based on date, matter, expense code, number of units) Warn

9 Invoice line item description contains key words (e.g., “online research,” “conflict search”) Warn

10 Invoice currency does not match vendor currency Warn or Reject


eBilling System checks invoices for billing rule violations

Law Department team members

review items that the System has flagged

The approved invoice is electronically

submitted to A/P for payment

7

Invoice Review Process

The invoice review process cycle time can be reduced dramatically through the initial check against billing guidelines. ü  The system will flag or automatically

adjust line items where a violation has been found

ü  The system will remind Law Department team members that there is an invoice to be reviewed

ü  The Law Department team member can focus only on those items the system flagged or adjusted

ü  Invoices are automatically submitted to A/P for processing on a nightly basis


Budgeting Guidelines & Philosophy

Budgets should be created collaboratively between the Law Department and law firm/vendor

Both the law firm/vendor and Law Department personnel should be responsible for the budget – it is not just the law firm/vendor’s responsibility to set, monitor and manage

Budgets should be based on ‘Most Likely’ rather than either the ‘Worst Case’ or ‘Best Case’ scenarios


•  For matters where external resources are retained: –  Require an estimate where anticipated total cost (fees and expenses) is

less than $X,000 (e.g., $25,000, $50,000, $100,000) –  Require a budget where anticipated total cost is greater than $X,000 –  Require a detailed budget where anticipated total cost is greater than $X,

000 •  Require an individual budget from each involved law firm or vendor if the total

cost for the matter is greater than above thresholds (even if individual budgets are lower)

•  If there is not the appetite for budgeting all matters regardless of spend, consider the desired outcome from budgeting to determine which matters will require a budget: –  Cost management: focus on higher cost matters are the focus –  Forecast accuracy: focus on less predictable matters at a greater revision

frequency

9

Budgeting Criteria


Anticipated <$50K*

Anticipated >$100K*

Anticipated >$250K*

Level of Detail Estimate Foundational Budget Detailed Budget

Fees ü ü ü

Expenses ü ü ü

Phase ü ü

Task X

Timekeeper ü

Duration Estimate Foundational Budget Detailed Budget

Month X

Quarter ü ü

Fiscal Year ü ü ü

Life of Matter ü ü ü

10

Note: The checkmark indicates fields to be populated and tracked in eBilling system. An “X” indicates fields to be discussed and monitored outside of eBilling system.

Recommended criteria and level of detail for matter estimates and budgets are below. •  Budget default can be set to Period of Time or Life of Matter.

Budgeting – Level of Detail

* Thresholds can be changed to fit the needs of individual Law Departments – numbers are just guidelines


Budgeting – Initial Setup

Require discussions between Law Department personnel and law firm/vendor at the onset of the matter to establish the budget to agree upon level of effort given the project needs and the specific details of the matter

Initial budget to be established within first 30 days or before incurring costs in excess of $5,000

Include budget-to-actual as a component in law firm/vendor evaluations and lead attorney performance evaluations


Recommended Matter Plan Template 1.  Detail & Scope of Activities (Activities and tasks that are in scope and out of scope) 2.  Goals (Desired end results and key deliverables) 3.  Key Assumptions (Premises that underlie the matter plan) 4.  Risks/Threats to Achieving Project Goals (Both realistic and reasonably possible

risks) 5.  Similar Deals/Documents to this Matter/Project (Work product that can potentially be

leveraged) 6.  Budgeted Fees & Expenses (incl. alternative fee arrangement proposal, if

appropriate)

7.  Staffing Plan

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Budgeting – Matter Plan

Name Title Billing Rate Area of Expertise

Matter/Project Role

Fees $

Expenses $

Total $


•  Budgets should be revised at the following points: –  Start of a new time period (e.g., fiscal year, quarter) –  When a significant event occurs that changes the scope of the matter

•  For budgets that will close in the current fiscal year, the fiscal year budget equals the Life of Matter budget. For budgets that span multiple fiscal years, a Life of Matter budget will need to be submitted

•  eBilling systems can provide email notifications to matter assignees when the budget hits a designated depletion threshold (e.g., 50%, 75%)

13

Budgeting – Ongoing Management


Market Tier Vendors

Market Leaders – Large Law Departments

Market Leaders – Mid/Small Law Departments

Emerging Players

141414

Vendor Landscape Summary

•  Mitratech and Wolters Kluwer (WK ELM) are typically found in top tier Corporate Law Departments. Both vendors have lower cost options that are better suited for smaller or lower spend Law Departments.

•  Onit and SimpleLegal have emerged recently in the industry and are gaining traction.


•  Automate time spent on reviewing and approving invoices to allow internal resources to focus on higher value work

•  State audit rules in Billing Guidelines to ensure firms are in agreement –  Remember: warnings/auto-rejections can be set at a line item level

•  Conduct periodic reviews of the Billing Guidelines with high-spend or long-standing relationship firms to gather feedback

•  Collaborate with outside counsel when setting budgets –  Prioritize matters with high spend –  Utilize Matter Plan template to begin discussions

15

Plan for Action


Vendor Landscape Details

16

Appendix A


Vendor Product Passport TeamConnect Legal Law Manager

(for Government Entities)

International Capability/Experience

ü ü

Headquarters Houston, TX Austin, TX Houston, TX

Company Ownership ELM Solutions is a wholly owned subsidiary of

Wolters Kluwer, a publicly held corporation in the

Netherlands

Privately Held Recently acquired by Mitratech

Experience/Longevity Since 1998 Since 1987 Since 1989

•  # of Clients •  Sample Clients

•  70+ clients •  Wal-Mart, Marsh &

McLennan Companies, Nissan International, Phillips 66

•  100+ clients •  AIG, Williams, Express

Scripts, DTE, FP&L, NiSource, Pfizer

•  400+ •  Targeted to Government

Entities

Strengths •  Advanced Solution vendor (Hyperion)

•  Magic Quadrant: Leader (Gartner)

•  Advanced Solution vendor (Hyperion)

•  Magic Quadrant: Visionary (Gartner)



17

Vendor Landscape – Large Legal Departments


Vendor Product Serengeti eCounsel CounselLink


ü ü ü

Headquarters Bellevue, WA Houston, TX New York, NY

Company Ownership Publicly Held Recently acquired by Mitratech

Division of Reed Elsevier, a publicly held corporation in

the UK

Experience/Longevity Since 2001 Since 1989 Since 1979


•  800+ clients •  Amazon.com, Nielsen,

Target, Stanford University, SallieMae, NCAA, Nike

•  400+ •  Chevron Phillips

Chemical, Dynegy, NiSource, Starbucks, Johnson & Johnson

•  100+ •  Stewart Title Insurance,

Kennametal, FedEx, Bank of America

Strengths •  Magic Quadrant: Challenger (Gartner)



•  Magic Quadrant: Leader (Gartner)

18

Vendor Landscape – Medium/Small Legal Departments


Vendor Product Onit Legal Apps SimpleLegal


Not Available

Not Available

Headquarters Houston, TX Mountain View, CA

Company Ownership Privately Held Privately Held

Experience/Longevity Since 2007 Since 2013


•  DaVita Healthcare Partners, Inc., The Home Depot, Under Armour

Not Available

Strengths •  Advanced Solution vendor (Hyperion)

Not Available

19

Vendor Landscape – Emerging Vendors


About UnitedLex

20

Appendix B


UnitedLex: Global Footprint A leader in law department management and technology-powered legal services.

Corporate Profile •  Founded in 2006 •  AmLaw 20 & F50 genesis •  Headquartered in Overland Park, KS •  2,000+ legal and business professionals

Innovation •  Patented technology supports core service offerings;

60 in-house software developers •  Only company to scale BPO methodology to legal

categories of service •  Pioneer in end-to-end managed services offerings to

general counsel offices, law firms and universities

Financial Sponsors

Omaha, NE

Overland Park, KS (HQ)

Santa Clara, CA

Austin, TX Gainesville, FL

Toronto, Canada Columbus, OH Cincinnati, OH

Richmond, VA

Miami, FL

New York, NY

London

Gurgaon

Hong Kong

Tel Aviv

Bangalore

Singapore

Sydney

Atlanta, GA

l ULX Office

£ Future ULX Office

l Global Professional Services

l Hosting Center

Dallas, TX

Washington, DC


UnitedLex Practice Areas

Digital Contracting Litigation Services

eDiscovery •  Questio based TPCG •  Pre-Discovery and Litigation

Readiness Consulting •  Early Data & Case Assessment •  Forensics and Data Harvest •  30(b)(6) and 26(f) consulting and

trial support services •  Culling and Filtering •  Data Processing •  Data Hosting •  Production •  Project Management Attorney Document Review •  Relevance, Privilege,

Confidentiality and Issue Codes •  Review Team Training & Staffing •  Project Management

Advisory Services Intellectual Property

Law Department Consulting •  Strategy/Vision Articulation •  Internal Resource Optimization •  Vendor Management and

Rationalization •  Technology Selection, Planning,

Design and Implementation •  Cost Management Information Governance and Compliance •  RIM Policy Design & Assessment •  ECM Solutions •  Legal Hold •  Data Mapping Cyber Risk Solutions •  Risk Assessments & Policy Design •  Information Security Risk Triage •  Third Party Risk Assessments Discovery Process Engineering •  Discovery Lifecycle Processes •  Litigation Spend Analysis •  Knowledge Centers •  Litigation Finance

Contracts Management •  Assessment of Contracting

Support Model/Processes •  E2E Outsourced Contracting

Solutions •  Template/Playbook creation

and harmonization •  Obligations Management •  Contracts reporting/analytics M&A Due Diligence •  Pre-acquisition •  Post-acquisition Contracts Review Services •  Contracts Audit and

Compliance Reviews •  Contract Repository Creation/

Migration Contracts Operations •  Up to 24/7 Helpdesk Services •  Outsourced Support Solutions •  75+ languages supported

Patents •  Patent Litigation Support •  Patent Monetization •  Strategic IP Acquisition and

Protection/Enforcement •  Landscapes/Patent Maps •  Freedom-to-operate/Clearance

Searches •  Filing and docketing support •  Patent Watches •  Patentability Clearance

Searches •  IP Due Diligence •  Portfolio Mapping & Analysis Trademarks •  Screening/Searching •  Application Preparation/Filing •  Prosecution Support •  Registrations •  Renewals •  Docketing Support •  Enforcement Support •  Trademark Litigation Support

We deliver economies of scale and knowledge to our Global Fortune 500 client base in the following areas:


Litigation Management: Life Sciences Expertise

23

Business Legal

Science Technology

EXPERTISE

Organization & Structure •  Intra-company coordination •  International Presence Regulatory Landscape •  Submissions (FDA Portal) •  Labeling and Marketing

Approvals (DDMAC/OPDP) •  Adverse Event Reporting Competitive Landscape •  Generic v. Branded •  Licensing & Marketing

Agreements •  Pipeline

Advice •  Meet and Confer, Discovery Protocol •  Cross-Border Discovery Domain •  Design, Formulation, Indication and

Delivery Patents •  Preemption, Strict Liability, Failure to

Warn •  Off-label Marketing, Medicaid

Reimbursement Protection •  Patient-Identifying Information •  Confidential, Trade Secret, Product-in-

Development Information •  Privileged Information

Lifecycle •  How a compound becomes

a marketed drug •  How a product becomes an

approved medical device •  Pre-clinical and clinical study

process and phases •  Pharmacovigilance and adverse

event reporting •  Epidemiology and Medical Affairs Therapeutic Areas •  Anti-Coagulants •  Cardiovascular •  Central Nervous System •  Women’s Health

Data Types •  Regulatory Submissions •  Adverse Event/Complaint Data •  Call Notes •  Lab Notebooks •  Medical Information Requests •  Clinical Data Repositories Data Sources •  Proprietary •  Third-party •  Validated •  Legacy •  Portable Media and BYOD •  Paper


Digital Contracting Solutions

•  Market leading technology employed

•  Leadership team with deep domain expertise in contracting

•  Global footprint with ability to offer multi-shore service delivery from 18 Delivery Centers

•  Strategic Alliances with 7 Major Law Schools that provide access to skilled but lower cost-talent (Notre Dame, USC, Vanderbilt, Emory, Ohio State, Miami and BU)

•  Certification Program with IACCM to ensure consistent training and skillsets for contracts negotiators

40% UP

TO

25%

Sales

20% UP

TO

Accelerated Revenue Cycle

1-3%+ Reduced Revenue/Margin Leakage

Compliance

Reduction in Contracts Compliance Costs

Proactive Monitoring

Systemic Risk-Management + Cost Avoidance of Non-Compliance

Procurement /Sourcing

10% > Efficiency Spend Savings

Simplicity, Compliance and Measured Performance

At a Significantly Reduced Cost

Self-Funded Innovation

Reduced Support Costs

45 Days

Go

Live

From Initial Assessment

Improved Net Promoter Scores/ Assured Revenue Recognition

Unprecedented Speed to Value