CAGR of e-billing implementation and some thoughts on interpretation of the data

According to surveys by the General Counsel Roundtable among its member legal departments, “use of electronic billing technology” rose from 2001 (25%) to 2006 (41%). Therefore, during the five years, the adoption of e-billing posted a cumulative annual growth rate of 10.4 percent (See my post of Nov. 26, 2006: CAGR and its formula, here ((0.41/0.25)^(1/5))-1.).

Sounds impressive, but we do not know what “use of” means, as it could be for some departments that only a fraction of the incoming bills are processed electronically. Nor do we know whether “electronic billing technology” means robust rules, currency conversion, international taxation and other features or merely receipt of invoices by PDF. We cannot even be sure from the data whether some law departments abandoned e-billing during the time period. Then too, the first year had 59 participants and 2006 had 130, so the populations changed. My final comment on methodology is that members of the GCRT, sufficiently interested in management to pay the annual membership fees, may be more inclined to invest in management tools than the average law department, so the calculated growth rate does not extrapolate to the law department world at large.

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