E-billing: thrilling or chilling?

E-billing: it’s not just for techno nerds, you know. As we report today, what Barclays, Royal Bank of Scotland (RBS) and ABN Amro are all independently discussing could change the client relationship for everyone.

The implications are huge. At its most basic level e-billing is about electronic delivery of information. Having accepted the principle of this, banks are now about to take it a stage further. Instead of only being able to scrutinise a bill at the end of a transaction, they want to be able to monitor the matter and its staffing in real time.

This approach is at the opposite end of the scale from the other major trend in the market, the fixed price for a job, which is what private equity clients demand. (That has the virtue of simplicity since there’s no need for armies of staff to provide an anal breakdown of costs. What’s not to like?)

E-billing also raises questions about how to get different software systems speaking to each other. The difficulties are compounded by the fact that firms are at different stages of development. The big City firms are way out in front, having spent an absolute fortune on global management information systems. They already hold detailed real-time information on live matters. They can retrieve what Barclays and RBS want at the touch of a button and, crucially, they can do it on a global practice basis, which is exactly what the banks are after.

If the banks demand this, then they may also have certain obligations towards their advisers, which again affects the relationship. And it comes down to this: if the client is getting regular, up-to-date information, then it is going to have to pay the external law firm regularly. As one partner puts it: “If it’s automatic billing, why can’t we have automatic payment?”

Unfortunately, the level of detail required by the move towards e-billing is going to come as a shock for some partners, plenty of whom have never drafted a narrative in their lives.

And then there’s the tedium of timesheets. You can put in all the systems you like, but the problem is always how to make lawyers file the information promptly. Multiply that by the prospect of getting everyone on a 10-jurisdiction deal completing timesheets, and you have yet another management headache that can only be solved manually.

That’s the thing about technology: it just keeps running up against human frailty. And that’s one thing even the most sophisticated process can’t solve.