Who knows better how to get rid of paper than a waste-management company?
And yet, two years ago, the small law department at Milwaukee-based Onyx Waste Services Inc. was in danger of drowning under a slurry of law firm invoices. It wasn't just the amount of paper coming in; an outmoded practice of hand-delivered, hand-approved bills for legal services was crippling the company's entire invoicing system.
So Teresa Seem, one of four in-house counsel at Onyx, enlisted the help of the
IT department and went looking for a remedy to the problem in 2002. And just like those stories where someone finds a Rembrandt hidden among the skates and old fondue sets in the attic, Seem discovered the answer to the legal logjam already loaded into her department's computers, right there next to MS Word and Excel: Microsoft Access. It's a lesson that other small-cap, short-resourced legal departments should note: You don't need to bust the budget to solve some of your operational problems. Sometimes you just have to take another look at the assets you already have.
"We didn't know how much Access could do for us," Seem says. "It's very adaptive, robust and easy to manipulate. And apparently it can do even more than we're asking it to right now."
Keep It Simple
The initial push for the new legal billing system came from Onyx's accounting department. In early 2002 it asked the legal department for a more streamlined system for processing invoices from outside counsel. At that time, every bill had go to the attorney responsible for a matter who evaluated and approved it and then manually transferred it to the accounting department.
One problem with this system was its invisibility to the Onyx field locations. Onyx Waste Services operates about 50 collection facilities and 26 solid-waste landfills in the United States, the Bahamas and Mexico, servicing 125,000 commercial clients and one million residences. These field and regional offices, where much of the outside legal work originates, weren't able to see legal invoices early in the process: a serious flaw in the system, since those bills would accrue against their budgets. They didn't know what bills the legal department had approved until Onyx accounting notified them that the expense was OK'd and queued up for payment--leaving them little time to dispute charges.
Keeping remote offices abreast of these legal charges meant duplicating paperwork; an invoice would come in, and the Onyx attorney responsible for the matter would look up the proper accounting code for the field office, enter the amount of the invoice and write a short description of the matter.
There also was the problem of timely approval. "We [Onyx corporate counsel] all had different systems and timetables for getting those approvals out, unfortunately," Seem says.
And the largest legal bills, with the most complex charges, naturally took longest of all to move off the attorneys' desks and into the system.
Finally, the legal department itself didn't have good insight into how much it was spending on outside counsel. The lawyers had been entering fees into an Excel spread sheet as they arrived from the vendors, but the department had no ability to track those expenses against its budget, no way to determine if they were approved and paid.
"It was a very flat program for what we needed--not very utile," Seem says.
Examining the software options in conjunction with accounting, Seem realized her department needed not just an invoicing solution, but one that would let the Onyx attorneys create files for each issue at its inception, add outside counsel as required, keep notes on steps taken as cases progressed, and then get the bills quickly into the accounting pipeline.
Enter The IT Guy
That's when Seem and her team called on Steve Heindl, one of Onyx's three in-house IT experts. (Another four computer experts man the company's help desk, and more are responsible for other Onyx lines of business: environmental and industrial waste services and power generation.) Seem and company had looked at several off-the-shelf e-billing and matter-management products such as Serengeti Tracker, but determined that they overshot Onyx's fairly basic requirements.
"We found them all to be kind of overwhelming for what we needed," she says. "We wanted something more customized and less comprehensive, without all the bells and whistles."
Heindl sat down with members of the Onyx legal and accounting departments and listened to their initial requirements. He soon realized that what Seem and the others needed could be created in-house with some smart coding and a database tool they already had at hand: namely, Microsoft Access.
"Access is one of the [Microsoft Office Suite] programs that gets overlooked," he says. "Everyone knows Word and Excel, but Access usually just sits on the desktop. Actually, it's a very potent program for creating and relating databases."
Heindl himself had created Access database programs before, both for other Onyx departments and at other companies. Those previous efforts did everything Onyx needed: drew together and searched multiple records, limited access in different ways and displayed information logically.
Heindl drew up a list of the information fields needed, the reports to be generated, and the levels of security required, then went back to his desk and adapted those past database projects to create screen shots for the new program.
One major decision at the outset was to generate a single unique ID for every legal matter, to be used by both the legal department and the accounting department to track legal invoices. This law department tracking number (LDTN) allows counsel, accountants and field operations personnel to view and make entries into the same data file for each matter, eliminating the duplicate paperwork. They all have different levels of access and visibility, so that neither accounting nor the field offices see case notes reserved for Onyx attorneys.
At the same time, Onyx set a new policy that all invoices for legal services should go first to the accounting department, not to legal. Accounting personnel ensure the invoice gets the proper LDTN, enter it into the database and notify any Onyx field office involved that the bill has arrived and is ready to be examined. The invoice--still in paper form--then moves to the corporate counsel responsible for the matter, who can confer with the field location, disallow line items such as copying costs if necessary, then send the annotated bill back to accounting. Invoices for matters that have not been entered into the database don't get paid.
Seem says standardizing the process and cutting duplication of effort has allowed Onyx to ensure a two-month turnaround of all its legal invoices.
"Our outside counsel are as happy about that as we are," she says.
And speaking of happiness, the decision to collaborate on building their own database rather than learning to use a packaged solution actually helped ease the adoption process for Onyx's staff. After consulting with Heindl for six months on what they wanted from their software--not to mention a long weekend spent doing the first data entry when the program went live in September 2002--the in-house lawyers and much of the accounting department knew quite a lot about the interfaces, how to use them and what kind of views they could produce.
"Because we helped create it, we had climbed part of the learning curve before it ever came online," Seem says. Dialog boxes indicate what information goes into which fields, and hyperlinks help navigate from one view to another.
Process efficiency was the starting point, but the benefits from automating Onyx's invoice handling didn't stop there. The staff has taken so quickly to the homegrown system that adding new ways to use it has become part of Heindl's job description.
"A couple of months ago, the lawyers wanted legal expenses broken out both by law firm and by state," he says. "Within a matter of 10 or 15 minutes, I had a new report available for them." He incorporated the function into a blank version of the program and put that revision onto the company's network; now anyone who wants a state-by-state report can generate it themselves.
Another major benefit of the system is it allows the lawyers to keep a closer watch on the use of outside counsel. While Onyx went through an active merger and acquisition phase a few years ago, most of the in-house legal work in Onyx's waste division is now contract negotiation. Compiling a central data repository of all Onyx's legal matters, including their use of outside counsel, allows Onyx vice president and general counsel Michael Slattery to take a comprehensive look at the department's use of outside counsel, as well as to study work flow among his staff. While Onyx won't publicize what the company now spends on outside firms, the implementation of this new invoicing system, and the oversight it allows, have resulted in a 40 percent reduction in those vendor costs, according to Seem.
One other unanticipated benefit is legal's new ability to send regular departmental performance reports up to senior Onyx executives, something the department now does monthly. Seem foresees that sending regular reports down into the field also might be useful.
As usual, even though the custom program does its job well, it doesn't talk fluently with other programs at Onyx--most notably, with the billing software or the accounting department. Seem hopes that an upcoming changeover in accounting software will bridge that gap. She also would like to get paper out of the process once and for all by scanning invoices into the system as they arrive, then letting Onyx attorneys call up those scans for review via hyperlink simply by opening the database file on a matter.
Heindl says those changes are entirely possible. But whether they come to pass or not, Onyx's custom-built invoice-handling and matter-management program constructed out of programs already bought, paid for and installed on desktops by tech support already on the payroll--has already more than met the expectations Seem had when she and Heindl first put their heads together two years ago. And she has no doubt what her work life would be like if the pair hadn't come up with a solution to Onyx's legal invoice bottleneck.
"I'd be tearing my hair out right now," she says.