Invoicing is the foundation for many organizations, especially law firms. Getting paid quickly and fully is vital to a law firm’s cash flow. Cash flow enables firms to invest in growth, attracting and retaining talent and expanding service offerings. Unfortunately, law firms are struggling with current billing processes due to the increasing popularity of e-billing technology. Systems such as Visibility, Allegient, TrailNet, CSC, Bottomline and Datacert are making the billing process challenging for law firms. Another obstacle law firms face today are legal auditors who review and adjust legal invoices.
In response to these barriers, law firms are hiring more staff and are having billing partners spend more time in the pre-billing phase. However, this is proving to be counterproductive because of the complex and varied guidelines being requested by clients and the sheer number of different systems being used.
The current approach law firms are taking is reactive rather than proactive. The traditional approach, a bill is sent to the client with the assumption that it will be sent back for adjustments, is no longer productive. It wastes time and resources, delays payment and ultimately hurts the firm’s reputation. It’s time for firms to modernize their billing process; below are several suggestions:
To improve invoicing, law firms should take a proactive approach by anticipating that clients will audit invoices. Understanding billing guidelines ahead of time will decrease the amount of invoices returned for adjustments. Consider incorporating this into your onboarding process with a new client. Three questions you may want to consider asking are:
- What e-billing system does your client use? What are the guidelines?
- Who is actually reviewing the invoice and what are they looking for?
- What level of detail is your client looking for on their invoices?
The proper guidelines for each client can then be established, saving you time and money.
Firms need to both understand and adopt technology that will help prepare accurate invoicing. Firms should seek a platform which:
- complies with each client’s unique billing guidelines
- identifies possible violations and offers recommendations and support
- produces reports which track the life cycle of the invoice from start to finish
Invoicing processes are shifting from an internal responsibility to an external system dedicated solely to invoice preparation. Firms who make this shift can expect to see an improvement in their invoice accuracy, cash flow, reputation and client relationships.
If you have questions about how to improve your current billing process, call on us today.