More Clients Embrace E-Billing

Like it or not, beginning on Jan. 1, 2005, outside counsel for FMC Technologies Inc. must agree to use electronic billing and accept payment online through a credit card company. “We're just trying to streamline processes where we can,” says Jeffrey Carr, vice president and general counsel for FMC Technologies, which has its corporate offices in Houston.

E-Billing and E-Payment

FMC Technologies has used e-billing for about 2 years with most of its outside firms, says Jeffrey Carr, the company's vice president and general counsel. By requiring outside counsel to submit invoices online, the legal department reduced the number of steps in its approval process for payment from 10 to three, Carr says.

But with the new Visa payment system that FMC will use beginning in 2005 ' it's similar to Paypal ' FMC's legal department will be able to pay its bills as quickly as a week after they are submitted, he says. That's in contrast to a lag time of up to 90 days under a traditional system that calls for the company to issue paper checks to pay its outside counsel, he notes.

Carr says about 90% of the billings from the 11 outside firms FMC Technologies uses for general litigation are submitted online, and about 85% of the billings submitted by the nine firms the legal department uses for intellectual property work are done through e-billing.

He hasn't heard much complaint from firms about e-billing, Carr says, but the response to the planned Visa payment system was mixed. “It's ranged from, 'We're a law firm ' we don't accept Visa,' sort of the white-shoe response, to a … 'Hey, this is kind of cool' response,” he says.

Carr notes that outside counsel likely will get paid more quickly with the new system. He also says it only seems fair for the in-house department to strive to simplify the billing process at a time when it is demanding so much from outside counsel.

Chevron Phillips Chemical Co. in The Woodlands set up e-billing in 2002 and used it in 2003 to process the vast majority of its invoices, says Craig Glidden, vice president and general counsel.

“It works great. It really streamlined the movement of invoice approval through the legal department,” Glidden says. “We have different levels of approval authority, so the invoices pass through an ascending level of approvals through our matter-management system.”

E-Billing Workflow

This is how e-billing works at Chevron Phillips, according to Glidden: A law firm sends an electronic invoice through an outside service provider, which translates its invoices into a file format that can be sent to the legal department's matter-management system.

The invoice comes in marked for the matter it relates to and marked with the predetermined number of approval levels (up to three) that it must go through. The bill is then routed through the legal department, where employees check the invoice to make sure it is consistent with the company's billing guidelines and budgetary expectations.

Glidden says the e-billing system makes it easier for the legal department to categorize and group cases and matters. “You don't have to go through an additional step of creating some spreadsheet. It takes your data and allows you to prepare reviewable reports,” he says.

Those reports help Chevron Phillips identify some areas with similarities, so cases and matters can be grouped together and the legal department can negotiate volume discounts with a firm.

Vendor Charges

Glidden says he's heard few complaints from firms. “There is a modest charge that the law firm has to pay to the electronic invoice service provider. The only time you get a complaint is when the amount of work you are giving a law firm is not commensurate with the expense,” he says.

One outside firm of Chevron Phillips is Campbell, George & Strong of Houston. Andrew Strong, a partner in the firm, says two clients, Chevron Phillips and Chevron Texaco, use e-billing. Strong says he likes e-billing a lot. The firm gets paid within 15 to 20 days, compared to up to 45 days from clients accepting paper invoices. His one complaint is the setup fee with the outside vendor that serves as the middleman for billing. Conceivably, he says, a firm would face high fees if each client used a different vendor.

Other E-Billing Users

In-house lawyers at a number of other Texas corporations say they already use e-billing or are getting ready to give it a trial run in an effort to save time and money and to reduce paper clutter. “As companies look for ways to … effectively manage their outside counsel costs and reduce them, certainly e-billing is something that has to be in the toolbox,” says Robert Johnson, assistant chief attorney at Exxon Mobil Production Co. in Houston, which has used some e-billing for the past year.

Irene Kosturakis, a senior counsel-intellectual property at Hewlett-Packard in Houston, says the IP group has used electronic billing for at least a year and a half. She says it works well and outside counsel like it because they get paid more quickly.

Advanced Micro Devices Inc. in Austin plans to launch e-billing by early February. Says vice president and deputy general counsel Patricia “Katy” Wells, “We believe it will allow us to more efficiently process the bills. We believe it will benefit the law firms because … they will be able to see where the bill is in the process.”

Wells expects e-billing to help her legal department generate better reports on what it spends on outside counsel, and to save money over the long run. It also will help the department make better decisions about where to spend its money, she says.

Wells says the response from the outside firms has been positive. One reason, she says, is because many of those firms already use e-billing with other clients.

Like it or not, beginning on Jan. 1, 2005, outside counsel for FMC Technologies Inc. must agree to use electronic billing and accept payment online through a credit card company. “We're just trying to streamline processes where we can,” says Jeffrey Carr, vice president and general counsel for FMC Technologies, which has its corporate offices in Houston.

E-Billing and E-Payment

FMC Technologies has used e-billing for about 2 years with most of its outside firms, says Jeffrey Carr, the company's vice president and general counsel. By requiring outside counsel to submit invoices online, the legal department reduced the number of steps in its approval process for payment from 10 to three, Carr says.

But with the new Visa payment system that FMC will use beginning in 2005 ' it's similar to Paypal ' FMC's legal department will be able to pay its bills as quickly as a week after they are submitted, he says. That's in contrast to a lag time of up to 90 days under a traditional system that calls for the company to issue paper checks to pay its outside counsel, he notes.

Carr says about 90% of the billings from the 11 outside firms FMC Technologies uses for general litigation are submitted online, and about 85% of the billings submitted by the nine firms the legal department uses for intellectual property work are done through e-billing.

He hasn't heard much complaint from firms about e-billing, Carr says, but the response to the planned Visa payment system was mixed. “It's ranged from, 'We're a law firm ' we don't accept Visa,' sort of the white-shoe response, to a … 'Hey, this is kind of cool' response,” he says.

Carr notes that outside counsel likely will get paid more quickly with the new system. He also says it only seems fair for the in-house department to strive to simplify the billing process at a time when it is demanding so much from outside counsel.

Chevron Phillips Chemical Co. in The Woodlands set up e-billing in 2002 and used it in 2003 to process the vast majority of its invoices, says Craig Glidden, vice president and general counsel.

“It works great. It really streamlined the movement of invoice approval through the legal department,” Glidden says. “We have different levels of approval authority, so the invoices pass through an ascending level of approvals through our matter-management system.”

E-Billing Workflow

This is how e-billing works at Chevron Phillips, according to Glidden: A law firm sends an electronic invoice through an outside service provider, which translates its invoices into a file format that can be sent to the legal department's matter-management system.

The invoice comes in marked for the matter it relates to and marked with the predetermined number of approval levels (up to three) that it must go through. The bill is then routed through the legal department, where employees check the invoice to make sure it is consistent with the company's billing guidelines and budgetary expectations.

Glidden says the e-billing system makes it easier for the legal department to categorize and group cases and matters. “You don't have to go through an additional step of creating some spreadsheet. It takes your data and allows you to prepare reviewable reports,” he says.

Those reports help Chevron Phillips identify some areas with similarities, so cases and matters can be grouped together and the legal department can negotiate volume discounts with a firm.

Vendor Charges

Glidden says he's heard few complaints from firms. “There is a modest charge that the law firm has to pay to the electronic invoice service provider. The only time you get a complaint is when the amount of work you are giving a law firm is not commensurate with the expense,” he says.

One outside firm of Chevron Phillips is Campbell, George & Strong of Houston. Andrew Strong, a partner in the firm, says two clients, Chevron Phillips and Chevron Texaco, use e-billing. Strong says he likes e-billing a lot. The firm gets paid within 15 to 20 days, compared to up to 45 days from clients accepting paper invoices. His one complaint is the setup fee with the outside vendor that serves as the middleman for billing. Conceivably, he says, a firm would face high fees if each client used a different vendor.

Other E-Billing Users

In-house lawyers at a number of other Texas corporations say they already use e-billing or are getting ready to give it a trial run in an effort to save time and money and to reduce paper clutter. “As companies look for ways to … effectively manage their outside counsel costs and reduce them, certainly e-billing is something that has to be in the toolbox,” says Robert Johnson, assistant chief attorney at Exxon Mobil Production Co. in Houston, which has used some e-billing for the past year.

Irene Kosturakis, a senior counsel-intellectual property at Hewlett-Packard in Houston, says the IP group has used electronic billing for at least a year and a half. She says it works well and outside counsel like it because they get paid more quickly.

Advanced Micro Devices Inc. in Austin plans to launch e-billing by early February. Says vice president and deputy general counsel Patricia “Katy” Wells, “We believe it will allow us to more efficiently process the bills. We believe it will benefit the law firms because … they will be able to see where the bill is in the process.”

Wells expects e-billing to help her legal department generate better reports on what it spends on outside counsel, and to save money over the long run. It also will help the department make better decisions about where to spend its money, she says.

Wells says the response from the outside firms has been positive. One reason, she says, is because many of those firms already use e-billing with other clients.