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The QuickBooks Online Advanced integration enables tracking for an array of processes, such as trust accounting, client reports, and billable hours, to name a few. We’ve ranked this as one of the best QuickBooks apps because it puts the data and reporting you need as a law firm right at your fingertips. LeanLaw is an industry-specific integration that boosts productivity for law firms and legal businesses. With DocuSign e-Signature for QuickBooks Online Advanced, you’ll be able to send an estimate out for electronic signature directly from QuickBooks making business convenient for you and your customers.This integration is exclusively available for QuickBooks Online Advanced users only. DocuSign eSignature allows you to seamlessly sign, send, and manage digital documents directly from QuickBooks Online Advanced. DocuSign eSignature Connector for QuickBooks Online Advanced enables teams to track down signatures from clients, employees, and other professionals when needed. DocuSignĮ-Signature app DocuSign is the first e-Signature integration added to our suite of Premium Apps. With data in real time, the connector provides you with accurate data to drive business growth. With these two systems working in tandem, you have complete visibility into your business and cash flow. You can also share data such as customer information, sales orders, expenses, and invoicing between these two teams. It’s great for bringing your sales and finance teams together to ensure consistent information is maintained between accounts, invoices, and payments. The Salesforce Connector by QuickBooks is a Premium App available for QuickBooks Online Advanced users only. Salesforce allows you to connect your business accounting and CRM so you can see how your business is running and where it can be improved. SalesforceĪnother top QuickBooks app is Salesforce. With QuickBooks Online Advanced and its HubSpot integration as a Premium App, customers can bring invoices into QuickBooks in a draft state, and set up their own automated flow to move invoices from draft to review and approval between HubSpot and Advanced. HubSpot is one of the best QuickBooks integrations because it allows businesses to sync their CRM and accounting softwares to speed up their sales cycle, helping sales and finance teams work better together.
With HubSpot and QuickBooks, you can see everything about your leads and customers, all in one place. If you’re in need of customer relationship management (CRM) software, the HubSpot integration is a must. Whenever a bill needs attention, you’ll be able to access it fast with the app. This functionality allows you to create payment schedules, set reminders, automate approvals, and more. Using with QuickBooks syncs your invoices, customers, accounts, book balance, and vendors. When you connect to your QuickBooks Online Advanced account, the Premium App-only capability of deep linking between bills in both programs is enabled. With the integration, all of your bank account information syncs with QuickBooks to help you manage your accounts receivable and accounts payable. gives you more financial control by allowing you to set up customized workflows and routing rules for faster and easier approvals from any device.
One of the most highly rated apps you can sync with QuickBooks is. Premium apps for QuickBooks Online Advanced Take a look at the QuickBooks Online Advanced set of Premium Apps and other standouts from our QuickBooks App Store that make bookkeeping, accounting, payroll, and other financial operations a breeze. That’s why we rounded up our picks for the best QuickBooks apps and add-ons that can grow with you and your business. Instead, these integrations boost productivity and make QuickBooks the single source of truth for your finances and your business.īecause there are hundreds of apps and add-ons in the QuickBooks App Store, finding the right one for your business can be challenging. With these customizable tools, business owners no longer have to spend hours manually inputting numbers and information. QuickBooks Online Advanced users can benefit from our growing collection of best-in-class Premium Apps, which enable access to your important financial information all in one place. These easy QuickBooks integrations streamline operations to help small- and medium-sized businesses run smoothly. QuickBooks® Online offers numerous applications and add-ons that integrate seamlessly to automate workflows, bookkeeping, invoicing, data entry, and more.
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Saltmarsh Cpas And Business Consultants
We are a gaggle of specialists who believe in creating comfy and trusting relationships. This permits us to make sure we understand your current wants as properly as your fiscal objectives for the lengthy run. Dalby, Wendland & Co., P.C., supplies business consulting, tax, audit, consumer accounting, and wealth administration companies with methods to help decrease tax exposure and advice to help our clients plan, develop, and be higher. Ultimately, you want an accounting agency that listens and invests in the relationship. At ORBA, their clients turn to us as their primary advisor for almost each monetary want. Our CPAs provide correct accounting services that will assist you understand your financial state of affairs.
If you still have questions after reviewing the types on-line, contact the CPE/Licensing Division on the Board. When your finances span generations, areas or companies, you need steerage nicely beyond the tax return. All CPA firms have entry to comparable assets – opt for the one that wants a meaningful relationship with you.
Fradin & Company, Ltd has been aiding people and small business homeowners in Warwick and out of state since 1960. In reality, our full-service accounting agency is celebrating its sixtieth anniversary! Our group consists of several CPAs, Enrolled Agents, and a Certified Financial Planner with many many years of experience between us.
Instead, they should continue providing primary compliance services to most purchasers whereas crafting a restricted slate of advisory companies for a handful of purchasers which are ready for such choices. This is a low-risk way to pilot the idea and create a model new income stream. Although it's a virtual service, Bench personalizes its purchasers' experiences by assigning them a dedicated staff of in-house professionals.
Accounting & Bookkeeping
The present common full charge bookkeeper's wage fluctuates between $35,000 to $55,000 per yr plus benefits and overhead, depending in your location. According to Glassdoor, present listings in high cost of residing cities like New York or L.A. In addition, you’ll need to add around 20% on prime of wage for advantages and overhead including office area. The client uses an industry-specific estimating program to calculate the job, then offers the bookkeeper with the total. They then enter the estimates into their QuickBooks Online account and create or progress invoices because the project moves along.
Do some research into and talk to your target market and develop services and pricing that can attraction to them. By enterprise analysis and niching your companies, you'll find a way to begin to market your self as an expert. Think about who your perfect shopper could be and what type of labor you’d do for them. Defining your best consumer will assist you to concentrate on certain services. You won't face any issues when it comes to speaking with us. We provide a dedicated project supervisor on all our tasks who will address all your needs and queries and maintain you abreast of all project-related developments.
Moreover, time may also be saved by eliminating actions like recruitment and overseeing of employees. Our job is to make your life straightforward, through email, fax, mail, or automatically downloading the data from your bank establishments. We will review and reconcile to make sure we seize all the odd and necessary bills. Based on documentary proof similar to service/ product delivery confirmations and sale order copies.
Our service choices cater to a large spectrum of clientele across the globe. Our Irvine bookkeeping service offers accounting, tax, and enterprise options on your firm in Beverly Hills. Irvine Bookkeeping bookkeeper maintains your Quickbooks Clio, or Leanlaw software program to your accounting records updated and compliance with their State Bar’s accounting requirements. We offer a full vary of strategic, monetary, and operational services.
Management Growth Programs & Consulting
MAP is your accountability associate, whether or not you need to accelerate development, align your group, or improve execution. We pair the proven MAP Management System™ with custom-made consulting relationships to guarantee you obtain the outcomes you need. MAP works like a GPS in your business™️– helping your business stay centered, aligned and accountable through the unexpected occasions which have the potential to derail enterprise results. Then help the right group mindset and behaviors with the right construction and processes to make change happen.
Look on the consultant’s resume, educational background and certifications related to your trade. It’s a good sign if they seem keen to discover new studying alternatives and keep their expertise updated. While you can rent an unbiased professional, you could also have interaction the companies of a specialised firm in your consulting wants. Big companies like McKinsey & Co. and BCG wouldn’t essentially match a small business’s wants and budget, but a local firm may work nicely.
From the start, an efficient relationship turns into a collaborative search for acceptable answers to the client’s real concerns. Ideally, every meeting involves two-way reporting on what has been done because the final contact and dialogue of what both events should do subsequent. In this fashion a process of mutual affect develops, with pure shifts in agenda and focus because the project continues. A marketing consultant will usually ask for a second engagement to help set up a beneficial new system.
The engagement characteristically concludes with a written report or oral presentation that summarizes what the consultant has realized and that recommends in some detail what the consumer should do. Firms dedicate a nice deal of effort to designing their reviews so that the data and evaluation are clearly offered and the recommendations are convincingly related to the diagnosis on which they're based. Many people would probably say that the purpose of the engagement is fulfilled when the professional presents a consistent, logical action plan of steps designed to improve the identified problem.
Prime Private Monetary Reports With Plumb Household Office Accounting
Monthly services for management reporting would often embody a financial accounting bundle with custom-made reports at month-end. Depending on the company and services required, outsourcing administration reporting might value $3,500 to $5,000 per thirty days on a recurring foundation. A financial report format that you can apply to virtually each enterprise throughout industries, this incredibly insightful device is pivotal to sustaining a wholesome, regularly evolving financial profile.
Whether you are a business entity or a person, you can count on us for award-winning tax preparation and planning. We understand every enterprise's tax needs and thus acquired state-of-the-art software program to deliver custom accounting providers. We are additionally a licensed tax originator with full e-filing capabilities and registered with the IRS. 會計師事務所 is crucial should you wish to run a profitable enterprise.
A company’s financial place on the finish of an accounting cycle is illustrated on the balance sheet. A company’s property and liabilities and equity ought to be detailed on a balance sheet. The balance sheet exhibits your company’s financial place with regard to property and liabilities and equity at a set cut-off date. Primary expenses, expenses from secondary activities and losses from exercise, together with depreciation, are detailed on the statement. It ought to be famous that depreciation is simply shown for the particular time period being reported and never the total depreciation of an merchandise in its helpful lifecycle.
Professionals And Cons Of Debt Reduction
If you don’t really feel comfortable communicating with creditors, you would hunt down the help of debt reduction providers and have certainly one of their representatives do it in your behalf. If you're looking for a greater way to manage your debt, with a objective of eliminating most or all of it, youve already taken a step in the proper direction. As you prepare to move ahead, do not neglect that some debt isn't bad—a mortgage may help you obtain the goal of proudly owning a house and will assist you to construct wealth if your home appreciates in worth.
Are there skilled memberships you probably can suspend temporarily until you get your financial house back in order? Consult your accountant or use accounting software to forecast the monetary impression of chopping prices in several areas of your small business. Accounting softwarelike QuickBooks to track cash flowing in and out of your corporation. Ultimately, revisiting and revising your finances will assist you to better handle prices and type an motion plan for reaching your debt-reduction objectives. If restructuring your small business debt is too much to take care of by yourself, contemplate working with a debt restructuring agency. For a payment, they will negotiate with assortment companies and collectors in your behalf so as to extend or change your present credit agreements.
It will not be the proper option if you would need to surrender property you wish to keep. Debt aid can ease the burden of overwhelming debt, nevertheless it's not proper for everyone. How to protect your private info and privacy, keep safe on-line, and help your children do the same. What to know if you're on the lookout for a job or extra education, or contemplating a money-making opportunity or funding.
Good cash management can improve an organization's liquidity, cut back prices, and enhance profitability. Kelly's Accounting can help you preserve optimal cash circulate levels by monitoring sources and uses, forecasting, and budgeting accordingly. To a enterprise entity, money circulate is one thing that may make or break the business' ability to survive.
Honeycutt & Grady, Cpa's
Our purchasers depend on us to offer a concentrated evaluate and analysis of their monetary knowledge, so they can focus on their core business. Whether you’re negotiating the sale or buy of a enterprise, settling a legal dispute, or implementing present and property planning, Condley & Company can present an objective evaluation of your small business. We realize your business has distinctive qualities, and our professionals are prepared to assist in figuring out its fair worth.
We have already set the benchmark for managing payroll capabilities and persistently maintains productiveness. Fred Martinez, LLC employs careful evaluation and due diligence to discover out a good asking value, pinpoint the most favorable tax buildings, consider financial and cash move impression, and assess suitable enterprise functions and tactics. From your organization's inception through its development and development, Fred Martinez, LLC can advise you on choosing an entity type and later restructuring if advantageous. Effective estate planning facilitates the orderly transfer of assets to your beneficiaries, provides security in your surviving partner, and may cut back or remove the tax due on the switch of your corporation and other property.
Goldberg Advisory Services, LLC can help you develop, implement, and administer your profit, retirement, and profit-sharing plans with a watch towards rewarding your employees and reaching your company's monetary and business targets. We also can help maximize tax advantages in implementing these plans. As your business grows, your small business and your employees will be rewarded for the onerous work that contributed to the success of your corporation. Goldberg Advisory Services, LLC provides a variety of companies to people and businesses in a wide range of industries.
Your Full Guide To Financial Institution Reconciliation On Your Small Enterprise
Finally, add or subtract all the objects marked as reconciling objects from your bank’s closing money steadiness. Then, examine the stability as per the money e-book with the steadiness as per the passbook of your account. In case the 2 balances do not match, it is fairly potential that the opening balances also didn't match. In such a case, you will have to reconcile your financial institution statement with your books of accounts for the previous period.
Companies usually carry out buyer reconciliation earlier than issuing their month-to-month financial statements. The customer reconciliation statement serves as proof that there’s no material inaccuracy within the accounts. We advocate a reconciliation be accomplished at least month-to-month to make sure accuracy and allow you to catch any unusual transactions. Unusual transactions could possibly be attributable to fraud or errors, especially if more than one account is used. By performing a reconciliation, it is possible for you to to raised perceive your true money place and money flow.
If you wish to put together a bank reconciliation assertion using this method, you'll have the ability to take stability as per the money e-book or stability as per the passbook as your starting point. This is a straightforward data-entry error that happens when two digits that are by accident reversed (i.e. transposed) when posting a transaction. For instance, you wrote a examine for $32, however you recorded it as $23 in your accounting software. You can keep away from these errors by printing checks instantly out of your accounting system.
A day’s cash receipts recorded in a depositor’s books in a single interval however recorded as a deposit by the bank within the following interval. Bank reconciliation helps organizations keep their monetary health by verifying that all records and statements are correct. Whilst there is no prerequisite for most businesses to reconcile often, doing so is a good behavior as it's going to imply that business and financial info is up to date.
Money Flow Projections
Disbursements include payroll, fee of accounts payable from latest purchases, dividends and curiosity on debt. This direct R&D methodology is finest suited to the short-term forecasting horizon of 30 days ("or so") as a outcome of that is the period for which precise, as opposed to projected, information is on the market. Businesses ought to evaluation their Current Ratio on a monthly basis.
It’s likely the buyer isn’t going to pay in full firstly of the project. More likely, the money will go into escrow, and you’ll receive payments when you achieve sure project milestones. Your company finances particulars cash expenditures, including business expenses, inventory purchases, and capital expenditures by sort. Cash circulate is a posh concept that stumps many small enterprise owners. That’s why we built this guide—to help you curb common cash circulate missteps.
Net Income – Net revenue is your expenses deducted from your income. Read more concerning the steps in the O2C cycle and the way to optimize it for your business on the ProfitWell blog. Subscription software program serving to you achieve quicker recurring revenue growth. And growth income have impacted internet retention over time. Doing anything inconsistently will provide you with inconsistent results.
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“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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How LeanLaw’s Director of Marketing Leads Growth
http://dlvr.it/PXz9JZ
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Building Momentum: LeanLaw Hires Director of <b>Marketing</b>
He's a perfect fit culturally and his digital marketing skills and data-driven focus are exactly what we need to take the company to the next level. We are ...
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Building Momentum: LeanLaw Hires Director of <b>Marketing</b>
He's a perfect fit culturally and his digital marketing skills and data-driven focus are exactly what we need to take the company to the next level. We are ...
from Online Marketing http://ift.tt/2k3xQWR via Online-Marketing
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Building Momentum: LeanLaw Hires Director of <b>Marketing</b>
He's a perfect fit culturally and his digital marketing skills and data-driven focus are exactly what we need to take the company to the next level. We are ...
from Online Marketing http://ift.tt/2k3xQWR via Online Marketing
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Introducing Cycle Time for Matter Stages & More Features
Today, we’re happy to announce a few new features to help you plan matter budgets, identify bottlenecks in your processes and make increasingly better decisions!
What’s New
Cycle Time: Average Time Spent on Kanban Stages
Once your workflows see some activity, Lawcus will analyze the average time spent on each stage. The metric will provide you insightful analytics to predict your future matters and deals.
A Cleaner Interface
We cleaned up the matter and deal cards, introduced color codes, added badges for tasks and assignee.
Color Codes
Color codes allow you to categorize your matter and deal cards by adding color labels.
Badges
We’d added badges for tasks, assignee, client on matter and deal cards. Green color for tasks badge depicts all tasks are complete for that matter.
Comments on Matters and Deals
Collaborate with your teammates, add comments on matters and deals.
Upcoming Features
Our team is working around the clock and continuing to add even more great features. Some future features include:
Google Calendar Integration
Zapier Integration
Tags on Contacts and Tasks
Client Portal
And many more features! Sign up to receive beta access.
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Know your data: How to grow your law firm
Know your data: How to grow your law firm #firm #law #business
Know your data: How to grow your law firm
LeanLaw customizes QuickBooks for law firms, meaning that the data collected by QuickBooks can be sorted out in LeanLaw to identify workflow issues.
accountantvip
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“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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Text
“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
from https://ift.tt/2K3jUa7
from https://eliaandponto1.tumblr.com/post/180184504177
0 notes
Text
“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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“Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes
Since they were introduced over 20 years ago, Uniformed Task-Based Management System (UTBMS) billing codes have brought clarity to billing and related data analysis. In fact, clients are now increasingly using UTBMS billing codes to analyze much more than just the cost of legal services.
For those who might not be familiar, UTBMS codes are used to classify legal services and expenses performed by a law firm or other vendor. UTBMS billing codes categorize legal work and expenses, whereas the Legal Electronic Data Exchange Standard (LEDES) provides uniform data formats for UTBMS-coded invoices to be submitted. Therefore, lawyers often refer to UTBMS codes as “LEDES codes”, although this is a bit of a misnomer.
The utilization of UTBMS billing codes allows both client and law firms to track and compare specific legal services and expenses and then map these data points to particular outcomes. Stated differently, UTBMS codes allow “Moneyball” kinds of analyses for law firms and clients.
However, inaccurate coding, as well as frequent use of default or catch-all codes, and random or non-uniform application of billing codes, all have a negative impact on the valuable data analysis and reporting envisioned and enabled by UTBMS codes.
When billing codes do not accurately reflect the services or expenses provided, the billing codes become essentially useless. Without accurate and uniformly applied UTBMS codes, the UTBMS goal of allowing law firms and clients to visualize profitability and make impactful decisions is substantially thwarted.
As Ed Finkel of the Illinois Bar Journal notes, “When it comes to optimizing your practice, do you trust your gut? Don’t. If you aren’t using data to measure what works and what doesn’t, you can’t be sure you’re winning the game. The good news: your practice generates the data you need to gauge success and adjust as needed.”
If you don’t already use UTBMS codes and LEDES formatted invoices, or if you are looking to strengthen your knowledge on the subject matter, this article will act as a guide on how to effectively extract the most from this valuable data.
A Brief History of UTBMS/LEDES Coding
UTBMS codes came about when law departments at companies purchasing large amounts of legal services wanted a better understanding of the services they received from outside counsel and other vendors. Imagine trying to make sense of legal spending based on bills that include only a vague description of services performed by multiple timekeepers for one day, with multiple intertwined paragraphs or pages to describe the services.
The legal sector and the corporate world saw room for improvement and acted upon it. In a joint effort to bring more transparency to this issue, the American Bar Association, the Association of Corporate Counsel, and PricewaterhouseCoopers created a unified task-based billing standard known as UTBMS.
UTBMS creates categories of specific legal tasks and expenses and then assigns codes to those discrete tasks and expenses. By associating these codes with time and expenses entries in invoices, the UTBMS codes allow clients to track their legal spending based on the specified categories. This, in turn, allows for greater data analysis, reporting, and fact-based decision making.
In addition to the problems with trying to organize and make sense of diverse legal tasks and expenses, the necessary information presented on paper bills was impossible to digest and analyze, so therefore insufficient.
Accordingly, once the joint group completed the UTBMS billing codes standards, their efforts moved to create a standard format for the exchange of billing information.
The LEDES Oversight Committee (LOC) was created. It is “an international, voluntary, not-for-profit organization comprised of legal industry representatives and is charged with creating and maintaining open standard formats for the electronic exchange of billing and other information between corporations and law firms.”
The LOC is dedicated to using open standards to uniformly satisfy the needs of the legal sector based on these five principles:
Keep it simple.
Make it unambiguous.
Diverge from existing formats only if absolutely necessary.
Only ask for information the law firm is typically able to provide form their financial system.
Meet the needs of corporations, law firms, and legal industry software vendors to the maximum extent possible consistent with the first four criteria.
Using the LEDES standard formats, receiving systems can electronically assemble billing tasks and expenses into more easily comprehensible formats, allowing for greater ease of review and speed of payment. This alleviated much of the burden on bill reviewers.
In addition, the combination of UTBMS codes and LEDES formatted invoices allows much easier internal reporting and facilitates action items based on empirical data analysis. For example, by using UTBMS codes and LEDES formatted invoices, clients can more accurately compare the services provided by outside counsel.
Value
The goal of UTBMS/LEDES coding is to create advanced metrics that allow both clients and law firms to achieve accurate internal measures of profitability and productivity, as well as to increase transparency for all parties involved.
Using these measures enables clients and law firms to capture meaningful billing information and data in an easier, more digestible way in order that they can analyze the legal services provided. In addition, clients and their law firms can more easily test billing records for compliance with outside counsel billing guidelines
International In-house Counsel Journal states that “a process that provides for actionable information from that data is central to being able to manage a legal department strategically and with greater efficiency. This is why the Uniform Task-Based Management System (UTBMS) code set is critical when looking at process improvements.”
In fact, without utilizing the UTBMS and LEDES standards, it is difficult to accurately assess legal spending or to develop useful insights that rationalize outside counsel retention and legal spending decisions.
But implementing the UTBMS and LEDES standards does not just benefit clients. Both law firms and clients alike benefit by being able to better understand their activities and improve efficiency.
Lex Machina’s Josh Becker explains in a Legal Talk Network podcast that, “It’s using data to demonstrate your expertise and to compete now on data, not just on kind of reputation or relationships maybe from the past, but to compete on data to showcase your expertise. And secondly, after winning business is winning cases. So using data to determine the best strategy in front of a judge, to size up your opposition, to understand how long it’s going to take to do your budgeting, all that part of winning cases.”
Law firms utilizing these standards to develop more meaningful metrics will be able to enhance their capabilities when it comes to strategic planning and collaboration efforts. They will also be able to communicate these results more effectively with clients. Attorney-client relationships will grow stronger in response to this as well.
Running the risk of making significant decisions based on inaccurate or misleading data can be devastating. But, with uniformly applied data standards in place, clients and law firms can make more carefully informed decisions based on empirical evidence.
Course of Action
Law firms and clients alike continue to look for new ways to increase efficiency and to develop new best practices. Implementing the UTBMS/LEDES standards offers one way to advance these goals. However, law firms and clients can take it a step further.
When a standard or process is created, technology always follows suit. There are various legal tech applications that have the ability to streamline these processes and standards. But, there are a few things needed prior to implementing this technology.
“While technology is requisite as an enabler for managing legal invoices, effective control rests on the creation of robust billing guidelines and accurate data collection… factors like the development of robust billing guidelines, the strict use of UTBMS codes, and the subsequent review of every line item of every invoice for conformance to your billing guidelines are prerequisite,” said Adam Beschloss and Steven Rudnick in Inside Counsel. These prerequisites are a must if you are looking to implement technology as an enabler at your company or law firm.
Once those prerequisites are in place, you can then investigate the marketplace to see which application can provide your company or law firm with the best value.
For clients, applications like Thompson Reuters’ Legal Tracker (Serengeti), LexisNexis’ CounselLink, and Wolters Kluwer’s TyMetrix 360° all offer efficient means of receiving bills from outside counsel, tracking invoices and payments, and conducting internal data analysis.
There are many applications that can help law firms accomplish their UTBMS coding and LEDES invoice formatting needs. For example, Clio, Rocket Matter, PracticePanther, Timeslips, MyCase, LeanLaw, and other billing and practice management systems all allow lawyers to add UTBMS activity and litigation codes, and create invoices in LEDES formats.
In most cases, these apps require users to select and apply appropriate UTBMS codes to time and expense entries from pull-down menus. Applications like LedesAssist eliminate the need for manual coding by automating the application of codes to billing entries. Automating the process makes UTBMS codes more valuable through uniformity in how the codes are applied. Law firms and clients should determine what application will provide the most value to their specific use case.
In a Deloitte report on legal billing and predictive coding, it states “current technology advances are providing opportunities to better measure, manage and optimize legal spend, even while leveraging conventional management tools… These advancements are expected to enhance management activities for both corporate law departments and law firms, and potentially allow the promise of activity-based management for legal activities to become better realized.”
Your firm or law department can use the data you already have to predict outcomes and related expenses. In addition to billing and cost analyses, “[l]egal analytics seems to take this to the next step by mining data in case dockets and filings, and then aggregating the data to reveal trends and patterns in past litigation that can be used to inform legal strategy,” said Annie Dike in Bulls Eye’s Expert Legal News.
Looking at Case Crunch’s lawyer challenge, we can see what potential predictive analytical tools hold for your firm. Case Crunch’s challenge included over 100 commercial lawyers against its computer program who were both given the basic facts of hundreds of PPI mis-selling cases in an attempt to see who could better predict whether the Financial Ombudsman would allow a claim. The results from the 775 prediction submissions showed the computer as the clear victor with an accuracy rate of 86.6%, compared with 66.3% for the lawyers.
By combining internal litigation records with billing data for the related cases, law firms and law departments can do even more. The potential of standardized coding and the data it provides are limitless, and its application extends outside of just billing.
The adoption of the UTBMS and LEDES standards has thus far been driven by clients who seek more data and information about the services they pay for. However, for law firms as well, having these tools in place to use their data and information more accurately will make lawyers more competitive and efficient.
Conclusion
Educating yourself on the UTBMS and LEDES standards to see the added value they can provide for your company or law firm is the first step.
You can then implement these standards to eliminate the ambiguity involved with billing data, and better understand areas for improvements—whether inside a law firm or from a client’s perspective. The benefits are for everyone.
Utilizing the available technology will put law firms at the forefront for the legal services they offer because of the greater transparency in both their billing and their internal metrics. In addition, clients will be able to manage their costs more effectively and to predict more efficient outcomes based on legal spend.
The post “Moneyball” for Lawyers: The Value of UTBMS/LEDES Codes appeared first on Law Technology Today.
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