Over the years since e-billing and spend management were first introduced, legal operations has evolved and matured. As legal and claims professionals have developed higher expectations, there have also been advancements in the technology available to help control legal spend. At ELM19, ELM Solutions Senior Director of Product Management Jeff Solomon was joined by Jonathan Weber, Vice President of Claim Optimization at Chubb, and Michelle Gallagher, Senior Advisor, Legal Operations at Dell, to talk about these changes and how they impact legal and claims organizations.
A Solid Foundation
The introduction of spend management technology had a huge positive impact on legal and claims teams. Companies found that these solutions could:
- Capture granular data about their spend by receiving outside counsel invoices electronically
- Improve productivity by automating invoice review paths
- Ensure compliance with business policies through automated bill audits against outside counsel guidelines
- Provide new visibility into legal spend, risk, and compliance with in-depth reporting and analysis on spend data
- Empower informed decisions based on data analysis
Companies typically saw savings of 2-4% or even more. By continuing to refine and improve their analytics as they gathered more data over time, some improved their results even further. When applied to legal spend in the tens or hundreds of millions of dollars, this represented a very significant improvement.
The Next Generation of Spend Management
In addition to the foundational spend management tools, companies can now leverage new technologies to increase their visibility into legal spend, supercharge their cost management capabilities, and be even more confident in their decisions based on advanced analytics.
Complete Visibility: Intelligent Invoice Conversion solves the problem of receiving “paper” invoices from some vendors, usually in the form of PDF or Excel files. These formats can’t be submitted via e-billing and are therefore not captured in reportable spend data. When a paper invoice comes in, the Intelligent Invoice Conversion is assisted by an artificial intelligence (AI) engine to convert it into a LEDES file, then human experts check to ensure the conversion is correct.
Once verified, the invoice is submitted to TyMetrix® 360° or Passport® where it is checked against billing guidelines and entered into the company’s invoice database. This technology enables companies to capture the data included on all their invoices for more complete and accurate reporting.
Supercharged Cost Management: LegalVIEW® BillAnalyzer is another managed service that combines AI and legal experts. In this case, the AI flags line items most likely to need adjustment, then human reviewers focus on these line items and work with outside counsel to help them understand how the invoice violates billing guidelines. By combining the best uses of AI with the skill and experience of expert reviewers, BillAnalyzer delivers up to 10% cost savings, increases guideline compliance up to 20%, and improves spend predictability while allowing in-house attorneys to focus on value-added work.
As Jonathan pointed out, if you got a bill for $200 at a restaurant with no detail about your order, you wouldn’t be likely to pay it. Enforcing rules about invoice detail makes billing transparent for Chubb while focusing on their billing guidelines improves transparency for their firms.
Smarter Decisions: LegalVIEW Analytics offers advanced analytics, dashboards and benchmarking data so that legal and claims professionals have the information they need to make the best decisions on their matters. Users can compare their organization’s internal data against industry benchmarks to identify opportunities for savings. And Predictive Insights uses AI and client-specific data to help select the best outside counsel for particular matters while setting the right expectations about budget and cycle time.
This holistic approach maximizes the benefits of spend management because the increased scrutiny on invoices improves the analytics results. Michelle feels that with both AI and human experts looking at every incoming bill, you get a more complete and accurate data set. Having good data that is structured well allows Dell to do more with analytics, identify patterns, and ultimately make better decisions.