The Juris® User International Group’s annual conference in October included a panel with Steven Levy from Microsoft® and Michael Gruskin from General Motors speaking about e-billing. I have extracted portions of an online report.
Levy identified three levels to e-billing:
Level 1 assures law firm compliance with engagement rules.
Level 2 analyses to improve efficiency.
Level 3 reduces cost.
GM receivers more than 50,000 law firm bills per year. E-billing has removed manual line item review from legal department personnel, increasing their efficiency. Gruskin noted. At Microsoft, compliance testing and the resulting adjustments for billing errors reduces Microsoft’s outside legal cost by 2-3% per year.
In addition, billing errors create friction cost that is of value to no one. Every rejected bill has to be reworked and re-billed at significant system-wide handling costs. Gruskin noted that one large law firm has five people who do nothing but handle GM billing. That cost has no benefit. It needs to be removed from the process by applying technology to assure compliance, remove errors and smooth the electronic submission process.