Fortune 500 companies generally process thousands of invoices each year, which is a bigger deal than it seems because legal departments are constantly facing budget constraints. Cost rationalization and controlling the firm's expenditure are significant problems for such companies.
Companies are finding ingenious ways to reduce their legal spend. A worldwide survey by CLOC found that companies spend only 0.44% of their total spend on legal services. The low figure is a result of companies' ingenuity and the efficiency that legal spend management software brings to the table.
Legal spend management is the oversight of the money corporations spend on outside counsel and other legal costs. E-billing can handle a significant portion of invoice management.
In this article, we will elaborate on some of the best practices a firm should implement when choosing an enterprise legal management system that works for them.
Legal Spend Management: Best Practices
Consult with outside counsel E-invoicing can reduce errors by 37%, according to an IBM report. The efficacy of legal spend management software increases massively when outside counsel is on board.
For a seamless experience, your outside counsel will have to use your potential legal management spending software, too. How law firms use the software is highly valuable. Consult with your outside counsel and get them on board with the legal software you're looking to use.
Usability This is the most important factor. Generally, e-billing software includes a vendor portal. This vendor portal acts as a bridge between your company and outside counsel. This portal will display the invoices submitted by outside counsel to your legal team.
The legal team can then start reviewing and approving invoices, tracking invoice status, accessing spending reports, and getting analytics from them.
Use the following metric to measure usability:
Interface: The vendor portal interface must be easy to use and intuitive. An easy-to-use interface will lead to law firms submitting invoices correctly.
User-friendliness: Law firms manage many clients and must use a variety of software because companies have different e-billing systems. The vendor portal of the legal software must be user-friendly. For example, Provakil's vendor portal is designed to feel natural to a first-time user. It is easy to use and will ensure that law firms have no trouble incorrectly submitting their invoices.
Submission of invoices: It should be fairly easy to submit invoices.
LEDES Corporate spending on law firms has decreased by 24% this past year, according to a CLOC report, with the help of e-invoices facilitated by Legal Exchange Data Exchange Standard invoices.
LEDES is a universal invoice format that makes it easier for enterprise legal management software to analyze invoices and automatically detect deviations from the agreed-upon terms.
Companies often employ many law firms. Often, boutique firms do not issue invoices in LEDES. This makes it hard for software to analyze them automatically. Explain the importance of a universal invoice system like LEDES to your outside counsel and encourage them to send you invoices in LEDES form. This will ensure that invoice processing is streamlined.
Some important things to keep in mind:
87% of business leaders say digital transformation is a priority. There is no point in using advanced technology that does not provide you with insights. Choosing an enterprise legal management software provides you with insights. Some law firms have lower hourly rates at first glance, but they take more hours to complete a task than other law firms.
This effectively means that you end up paying more. Legal software that can give you insights like which law firm is providing the most value for money should be chosen.
A survey by UK-based Legal Week Intelligence found that in-house firms value quality over price. Find out how much value a law firm is bringing to the table with the data analytics of legal spend management software.
90% of in-house counsels said that controlling legal spend was a huge priority, according to a Thomas Reuters study. Several legal software services charge law firms when firms submit their invoices. The law firms then pass the cost to the company.
It means that you not only pay for the software itself, but you also incur costs on every invoice submitted through the vendor platform. Companies receive thousands of invoices every month. Service costs can be quite high. Choose a service that does not charge for the cost of service to outside counsel.
Some legal spend management software only allows law firms to submit one invoice at a time. This creates a major problem, and the whole point of automation is wasted.
Fortune 500 companies typically spend an average of $154 Million every year on external counsel. This cost can be significantly reduced and more easily managed with enterprise legal management software such as Provakil.
The legal department will also have to spend substantially less time reviewing and processing legal invoices. By eliminating repetitive administrative work, legal departments can focus their time on more useful projects.
Enterprise legal management software is a new-age, high-tech product. Not everyone can get the hang of them easily, even if the interface is user-friendly. Ask different legal management platforms for demonstrations.
Not only that, but also provide a software demonstration for your outside counsel, as they will have to use it often, too. Legal spend management software like Provakil offers free demonstrations for companies. Supercharge your team with a demonstration from Provakil.
Book a demonstration for your company and your outside counsel now.
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