Finding the holy grail: on-demand billing
Traditionally, law firms have billed clients on a monthly basis. This process is highly manual and time-consuming: because billing departments accumulate time entries for 30 days, review and assemble pre-bills, then send them to lawyers to edit, correct, or write down fees before the firm sends invoices to clients. Further billing delays and impediments can occur when pre-bills don’t match a client’s billing requirements.
But what if there’s a better way of billing?
A more comprehensive time-management approach could provide support for the ultimate efficiency in law-firm finance: on-demand billing. Imagine if firms could bill whenever the billing manager says sufficient time entries have accumulated, or as they reach predetermined budget-to-actuals benchmarks. Potentially, firms could even send bills bi-weekly (or even weekly), depending on the matter and client. Not only would this shorten the collections cycle, but many clients would greatly appreciate better visibility into matter progress.
By implementing a more comprehensive timekeeping methodology, firms can collect more-accurate time entries, ensure that timekeeping is compliant with client billing terms up front, submit bills more rapidly and frequently, and boost realization rates. It’s the holy grail of profitability.
Getting rid of paper in your billing practices
Are billing departments ready for this approach? Yes and no. Although many firms use paperless billing tools that could help them bill more frequently, many do not. According to the 2019 Orion Prebill Survey, “More than 71% of law firm accounting/billing departments were still circulating paper printouts and collecting handwritten annotations to capture lawyers’ input before finalizing invoices. Only 12% were using electronic PDF prebills.”
But when the time comes that firms are ready to take this step, those that have modernized to use paperless billing and then add time-entry automation — allowing fee earners to send accurate and fully compliant time entries to the billing department — will find themselves a major step ahead of the competition.
Go for the gold with comprehensive timekeeping
Of course, none of this can happen unless firms start to capture accurate and compliant time entries that efficiently support pre-billing and billing. A comprehensive time-entry approach provides these capabilities that will allow firms to drink from the golden chalice.
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Finding the holy grail with on-demand billing
How do you get to the holy grail of on-demand billing by using a comprehensive time-management approach?