Have you ever heard that old expression about life, “It’s about the journey, not the destination?” When selecting a legal bill review vendor, it’s about both. You need to ask the right questions on the road to evaluating potential vendors in order to arrive at a decision that is right for your organization.
Let’s look at a typical scenario- your legal department has just decided to put a legal bill review program in place. Now what? How do you go about the formidable task of selecting a vendor? Before you begin contacting prospective vendors, first establish your goals for the program. Are they purely cost savings? Do they focus on efficiency and workflow improvements? Having a clear vision of your program goals will assist you in quickly eliminating some vendors and putting others at the forefront of the decision process.
Once you have established your goals, you can begin the process of identifying the vendors that may be able to meet your program objectives. Besides specific questions surrounding what you want to achieve with your program, below is a list of the top 8 questions that should be asked when evaluating a vendor. This is not intended to be an inclusive list, but a few questions to get you started on your journey to finding the best vendor for your program.
What are your service/product offerings?
Discuss the company’s product offerings with the vendor. Are you looking for an e-billing application only, a program that has attorney review, or both? Do you need matter management, document management, and analytics? Just because a vendor offers every bell and whistle, it doesn’t mean they are necessarily the best vendor for your program. Focus on the attributes that you need and then evaluate companies based on those items. Don’t forget to inquire about their reputation in the industry.
If you are looking at a program that has attorney review, find out who performs the audits. Is the vendor using paralegals to review your invoices or first-year law students? The auditors should be seasoned attorneys with several years of litigation experience. A legal auditor should have specialized knowledge of the litigation process and in spotting billing issues.
What is your price structure?
There are just as many pricing structures in the market as there are vendors. Some charge a flat fee based on the number of users on the software or a percentage of the dollar amount of the invoices reviewed. Others extend their fee to the law firms instead of the client. There is no right or wrong way to price these programs, but just make certain that you have a full understanding of charges before you select a vendor. A vendor may offer a very low price, but they could charge additional fees for training, customized reports, or minor modifications to their software. Make certain to account for all possible expenses when comparing pricing schedules.
Is your software flexible? Can it be modified?
Make certain to discuss the flexibility of the software with potential vendors. Is the system able to handle different types of workflow? For example, do you want one person to have authority to review an invoice or do you want an employee to review the invoice and a supervisor to approve?
Another issue that is worth addressing with a potential vendor: Is the system flexible enough to capture custom data? For instance, your company may track the business unit associated with a particular matter. Can the legal spend management application capture the business unit information from your data feeds and use it in your reporting?
How long is your contract term?
Before you enter into a relationship with a legal spend management vendor, it is important to know the contract terms. Some contracts lock clients into a relationship for several years. Ask the vendor about the penalties for early withdrawal on the contract. Also, inquire about your data. Make certain you remain the owner of your data and your data is easily transferred to you at the end of the contract or upon early termination.
How is my account serviced once I sign the contract?
You are the most important person in the vendor’s world before you sign the contract, but what happens once the contract is signed? What type of service is available to you and your employees once you start a program? Some vendors have dedicated program managers for your account. This person should be your main point of contact for all of your program questions and concerns. Since a legal spend management program has bill review, IT, and customer service involvement, it is important to have one person within the vendor’s organization who can make certain your requests are addressed.
Do you have customer service for the law firms?
Law firms spend a significant amount of time in the vendor’s application. Many of your law firms will upload their invoices in a LEDES format, directly into the vendor’s software. Check with a few of your firms to see if they have positive or negative feedback regarding a vendor. Ask a potential vendor about their customer service for law firms. Do they have a dedicated department to assist firms in uploading invoices, budgets, and other billing questions? Does the vendor’s software allow them to track the status of their invoices?
Do you offer an analytics package?
Today, almost all legal spend management vendors offer some type of analytics package. Analytics software allows you to go a step beyond basic cost cutting. Having visibility into your legal spend data allows you to compare law firm performance, examine your spend by areas such as geography and business unit, and assists you in pinpointing patterns in your data.
Every organization is unique regarding what type of data is important in evaluating firms and internal performance. Make certain that your vendor’s application can accommodate the type of information that is important to your company. Having a stable of standard reports is a must, but also inquire about their ability to create customized reports according to your specific needs. Is the vendor agile enough to create custom reports without requiring exorbitant add-on fees?
What type of security do you have in place?
Most vendors will give you the option to house your data at your facility or offer a hosted solution. Usually the hosted solutions are an easier, more cost-effective option that takes the burden off of your internal IT department. If you select a hosted solution, make certain to ask where the data is hosted. Does the vendor have a secure location for your data? Do they have a disaster recovery plan in place? Also inquire about the length of time they will archive your data and specifically, what data is archived.
In conclusion, when selecting a legal spend management vendor, take time to outline your main goals and objectives for the program. Then, ask the above 8 questions when interviewing potential vendors along with questions specific to your program. Take these simple steps and your journey to finding the right vendor will have fewer bumps along the road.
For more information about how Stuart Maue can help you effectively manage your legal spend, contact us at: 1-800-291-9940 or e-mail: firstname.lastname@example.org.