Wolters Kluwer Survey Reveals Legal Departments Struggle with Billing and Staffing Guidelines

Wolters Kluwer’s ELM Solutions, in partnership with Gartner (formerly CEB), has released a study that reveals just 6% of corporate legal departments and insurers believe that their outside counsel and billing guidelines are conducive for audit and compliance purposes. It appears that although the majority of large to mid-sized corporations (62%) currently have legal billing and staffing guidelines in place, very few are using them strategically.
Wolters Kluwer’s ELM Solutions and Gartner surveyed 51 large and midsized companies “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.”
More than 75% of respondents already have guidelines or are developing them. When it comes to the primary objectives in implementing billing and staffing guidelines, 75% of respondents stated they wanted to control costs; 65% wanted to ensure basic compliance with processes; 60% wanted to create consistency across relationships with outside counsels; 55% wanted to make it easier to manage outside counsel and 23% wanted to define and ensure work quality.
Just 31% of respondents reported that they were satisfied with outside counsel’s compliance with their guidelines, with not a single respondent completely satisfied. Furthermore, 36% of respondents admitted that they do not know who takes responsibility for overseeing compliance with guidelines at each firm. Worryingly, only 33% indicated that legal employees know the content of the guidelines “well or very well.”
“While most claims and corporate legal departments have billing guidelines, few are happy with results,” writes Bill Sowinski, Director of Decision Support Services for Wolters Kluwer’s ELM Solutions in the survey report. “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.”
Earlier 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”, offering clients an average cost saving of 6 to 9 percent in legal fees.