Law Firms 'Building a Case' for Automated e-Procurement Solutions

In today's economy, the demands of clients are causing a shift in the strategic focus of some law firm executives. Firms still have to remain competitive in attracting top talent to build revenue, but now more than ever, they face the challenge of offering competitive rates on top of best-class customer service to their clients. While we have seen a dramatic rise in attorney salaries, we have seen an even greater rise in the costs of doing business and a reduced willingness by clients to foot the bill. In response to these trends, law firm executives are now experiencing an increased pressure from their partnership to strengthen the bottom line by optimizing administrative performance.

On all facets of the non-billable full time equivalent (“FTE“) infrastructure, we see initiatives which target:

• Improved operational efficiencies;
• Streamlined communications;
• Automated processes;
• Methods to enforce strict controls; and
• Opportunities to drive administrative employee accountability and monitor job performance.

These broad goals impact projects ranging from technology implementations to global recruiting efforts. As a function of the overall desire to increase accountability and decrease costs, transactional procedures relative to purchasing, payables, and receivables are under the highest scrutiny. Through the appropriate application of targeted, best-in-class procedures and technology, law firms can build their competitive edge in the marketplace by:

• Reducing overall administrative costs and leveraging firm spend;
• Minimizing purchase transaction expenses and cycle-times, driving administrative efficiency to further reduce costs;
• Offering better spend visibility and reporting to appease external requests and track internal metrics related to diversity and green vendor initiatives; and
• Showcasing professional procurement practices in client proposals, offering confidence to clients that reimbursed expenses are managed appropriately.

Drafted policies and procedures are supposed to dictate the rules, guidelines, and processes which secure efficient cost management. These policies typically focus on administrative areas such as budgeting, project management, purchasing, inventory management, and payables management. Unfortunately, paper policies are only effective when measures are taken to secure internal compliance. More often than not, we see firms invest time, resources, and energy to develop paper policies with strong intentions to improve business operations, but they are unable to overcome manual administrative commitments to conform. Additionally, we see firms expend resources to standardize procured commodities and leverage economies of scale with preferred suppliers only to be unable to drive spend through negotiated contracts. A main culprit for the unfulfilled potential in both examples is the lack of systemized tools to make these efforts work. Time is wasted and value is decreased because manual processes are burdensome, controls are not enforced, and communication is lost.