Compare and contrast the law-specific links with the articles featured in this month's Law Practice Today to judge how thinking on the subject has changed over the past few years. Some of the resources, including the ABA reports and the weblogs featured below, are terrific and contain more current commentary on the subject. If you want one place to start, it probably should Alan Weiss’s “Ten Ways to Convince” article mentioned in the first section below.
Collections of Articles
DuPont Legal Model (http://www.dupontlegalmodel.com) – in 1992 Dupont changed the way it dealt with law firms, reducing its outside counsel from 350 to 35 firms. The Dupont Legal Model has become a respected method for corporations to deal with their outside counsel, and alternative fee arrangements are a big part of the Model (http://www.dupontlegalmodel.com/files/introduction_altfee7.asp). Also, be sure to check out "Alternative Fees for Litigation: Improved Control and Higher Value" (http://www.dupontlegalmodel.com/files/onlinelibrary_detail.asp?libid=2) in the site's Online Library.
The Law Marketing Portal (http://www.lawmarketing.com) – A great website for browsing for current ideas and developments. You might find articles, interviews and transcripts of seminars on legal marketing and billing issues. Many experts feel that the alternative fee arrangement question is at least as much a marketing issue as it is a financial issue.
The Law Partnering Institute (http://www.lawpartnering.com/)
– Although a lot of this site is “members
only,” the “in the News” section
(http://www.lawpartnering.com/press.tmpl) with links
to good articles and stories about some key figures
in the alternative billing world, such as Mark Chandler
of Cisco and Jeff Carr of FMC Intl’ can be found
here. The LPI also sells books, including a comprehensive
manual, and other resources. If you have large corporate
clients, you will want to know about this site.
The Marcus Letter (http://www.marcusletter.com/)
– Bruce Marcus is the co-author of the new book,
Client at the Core - Marketing and Managing Today's
Professional Services Firm. His website and newsletter
contain a number of free articles on billing and practice
issues. You might start with “Anticipating Future
Shock” (http://www.marcusletter.com/Billing%20structure.htm)
and proceed from there.
SmartPros.com (http://www.smartpros.com) – SmartPros covers a wide range of professional services issues. You might start with Ron Baker’s “Hourly Billing Limits Profitability” (http://accounting.smartpros.com/x8806.xml) and surf your way through the “Related Stories” boxes, or you might simply search for relevant articles in the archives (http://accounting.smartpros.com/x13535.xml). Our search on “value billing” turned up 77 articles. In any event, a subscription to the free Accounting News & Insights email newsletter guarantees that you will get a couple of good ideas for your practice every Monday morning, even if you have no interest in the accounting-related news.
Summit Consulting: Weiss, Ten Ways to Convince a Buyer That Value-Based Fees Are Best (http://summitconsulting.com/articles/vol-4-3.html) – Alan Weiss is known as the Million Dollar Consultant for good reason, not the least of which is his highly-regarded book, Million Dollar Consulting. If you ever get the chance to see him speak, do not miss the opportunity. This article is a clear, plain language set of arguments for value billing that you might want to memorize. His website gives you access to quite a few articles on fees, billing and other useful topics, as well as a chance to learn about his many books, including Value-Based Fees: How to Charge-And Get-What You're Worth. Weiss can be blunt, is quite entertaining, but will make you think and take some action.
Individual Articles
Altman Weil Alternative Billing Issues (http://www.altmanweil.com/about/articles/lfma/alt_billing.cfm) – I hesitate to mention this site, because all four articles listed here date from 2000. However, they may be valuable in evaluating how the idea of alternative billing has evolved. I would hope that a legal consulting company like Altman Weil would be more current on the subject.
An Alternative Fee Mealodrama (http://www.hildebrandt.com/Documents.aspx?Doc_ID=1866) – this tongue-in-cheek article dramatizes the dance between the general counsel and outside attorney on alternative fee arrangements.
Baker, “Burying the Billable Hour” (http://www.accaglobal.com/pdfs/members_pdfs/publications/123727) – This 44-page PDF document is a great introduction to and summary of Ron Baker’s influential work on value billing for accountants and other professional service providers. Caution: Although the direct link to the PDF has been published on the Web and will take you directly to the document, the document is located in a “members” directory and “free” access may not be accidental, rather than intended. As a result, this link may stop working at a later point.
InBrief, “Fee for All” (http://www.inbrief.co.uk/ArticleDetail.asp?id=14842&Section=pmi) – As the subtitle says, “A quarter of all fees generated by the UK’s top 100 law firms are no longer billed by the hour. Cameron Timmis asks why.” A very useful article that compares developments in the United Kingdom with those in the United States.
Lauer, What Do Law Firms Sell? What Do Clients Buy? (http://www.abanet.org/lpm/lpt/articles/fin01042.html) and The Billable Hour: Putting a Wedge Between Client and Counsel (http://www.abanet.org/lpm/lpt/articles/fin12032.html) – Steven Lauer’s two recent articles in Law Practice Today provide an excellent overview on the current issues and trends in alternative billing in the legal profession.
Ullrick, The Alternative Billing Diner: Serving Up a New Billing Scheme for the Technological Age (http://grove.ufl.edu/~techlaw/vol5/ullrickfinal.htm) – written by Bradley Ullrick in the Spring 2000 issue of the Journal of Technology Law and Policy (University of Florida School of Law), this comment advocates that the ABA should revise its stance on billing to account for technological advances in the legal profession. As you can see below, the ABA did just that.
Wagner, The 15 Elements of Alternative Fee Success (http://www.eletra.com/sugarcrestreport/e_article000064970.cfm) – A good list of fifteen common elements found in firms that have had success with alternative fee arrangements.
ABA Resources
ABA Commission on Billable Hours Report (http://www.judicialaccountability.org/articles/ABABillableHours2002.pdf) – this 90-page report was published in August 2002, and is a detailed look at the state of the billable hour, as well as various alternative billing methods.
Ad Hoc Committee on Billable Hours (http://www.abanet.org/careercounsel/billable/toolkit/toc.html) – the companion page to the ABA Commission on Billable Hours, here you'll find links to many of the resources cited in the report above. Some of these links are described in greater detail below.
Alternative Fee Arrangements, April 26, 2002 (http://www.abanet.org/careercounsel/billable/toolkit/altfeeslmahandouts.pdf) – this article was actually prepared by the Sugarcrest Development Group for the Legal Marketing Association, but it found its way onto the ABA website. The authors discuss the different types of alternative billing arrangements, and the advantages and disadvantages of each.
Law Practice Management Magazine, April 2002 (http://www.abanet.org/careercounsel/archive/lpmapr02.pdf) – this PDF file contains the entire April 2002 issue, which was titled "Break the Billable Hour Habit." Here you'll find great articles from Marc Lauritsen, Sally Fiona King, Edward Poll, Tom Collins, and others.
Model Programs on Billable Hours (http://www.abanet.org/careercounsel/billable/toolkit/modelprograms.html) – the main purpose of this page is to provide guidance to those interested in presenting a seminar or panel discussion on alternative billing. Pay attention to the PowerPoint presentation (http://www.abanet.org/careercounsel/billable/toolkit/billablepowerpoint.ppt) and the online video, "The Nuts and Bolts of Alternative Billing for the Business Lawyer and Corporate Counsel," (http://www.abanet.org/careercounsel/billable/toolkit/presentation.html), presented by the ABA Section of Business Law in 2002.
Thinking Outside the Box (http://www.abanet.org/buslaw/blt/2004-05-06/greene.shtml) is an article from the ABA Publication Business Law Today, and it's from the very recent May/June 2004 issue. It's a thoughtfully written article on leaving the billable hour behind.
Publications
Association of Corporate Counsel Alternative Billing InfoPAK (http://www.acca.com/infopaks/billing.html) – Updated in April 2004, this PDF file provides some great information on setting up alternative billing arrangements between outside and in-house counsel. Only problem is, you have to be a member of ACCA in order to download the PDF file; if you know an ACCA member, take advantage of this resource.
Association of Corporate Counsel – "Success Formulas for Containing Outside Legal Costs" (http://www.acca.com/chapters/socal/program/managefees.pdf) – if you want a free resource from ACCA, check out the contents of this presentation from ACCA's Southern California Chapter. It's mostly bullet-point wisdom here, but it's worth reviewing.
Association of Legal Administrators Articles (http://www.alanet.org/education/mrc/bytopic.html) – Check out the "Billing and Profitability" publication, which features such articles as "Take a Closer Look at Value Billing," "Alternative Billing Options Keep Clients Satisfied," and "Task-Based Billing: The Way of the Future."
Books on Alternative Billing (http://www.blawgchannel.com/2004/08/two_great_new_b.html) – Dennis Kennedy recommends three books to get a jump-start on thinking about and implementing value billing from Jim Calloway & Mark Robertson, Alan Weiss, and Ron Baker. Larry Smith’s book Inside Outside, gives a very good overview of alternative billing from the point of view of corporate general counsel.
State Bar Resources
Missouri Bar Association – Report of the Alternative Billing Methods Committee (http://members.mobar.org/billablehours/ABMC_Report.htm) – this September 2003 report discusses the billable hour in Missouri, as it relates to the ABA Commission on the Billable Hour's 2002 report, above.
North Carolina Alternate Billing Commission (http://www.ncbar.org/about/commissionstaskforce/alternatebilling.aspx) – in addition to the final report of the Commission, this page provides links to 20 alternative billing forms to use with your clients.
Weblogs
LawBiz Management Company (http://www.coachtolawyersblog.com/) – this is Ed Poll's weblog, which is a part of the larger LawBiz Management Company website (http://www.lawbiz.com/). Ed's business is the business of law, and he knows quite a bit about fees, billing, and alternative arrangements. If you read weblogs through a newsreader, subscribe to his RSS/XML feed; if you are more the e-mail type, Ed also has a e-zine that comes out once a month.
the [non]billable hour (http://thenonbillablehour.typepad.com/nonbillable_hour/) – Illinois lawyer Matt Homann hates the billable hour, and he'll tell you so regularly on his weblog. He frequently posts comments about other types of billing arrangements, plus other out-of-the-box ways of thinking about the practice of law.
Strategic Legal Technology (http://prismlegal.com/wordpress/) – Ron Friedmann of Prism Legal Consulting discusses strategic thinking about technology planning, knowledge management, litigation and practice support, and more. Ron discusses alternative billing from time to time, and the rest of his posts are great, too.