Law firms are under pressure to increase profitability and at the same time deal with stagnant revenue and increased costs. Improvements in productivity appear to be easier than rate increases in keeping a firm healthy.
I read with some disbelief a recent recommendation suggesting that attorneys send a personalized cover letters consisting of a paragraph or two with their monthly billing statements. The overall concept seemed understandable; just explain to the clients what you’ve done.
The idea of sending a personalized cover letter with each bill does nothing more than slow up the billing process, cost the firm cash flow and may allow the attorney to think that he/she is actually communicating with the client. The fact is, anything important the attorney needs to communicate to the client probably can’t be put in a general cover letter that passes through the accounts payable department in any case. In an efficient mid-size or larger law firm we want the accounting department to get good, clean bills out to clients for payment as soon as possible. Delays don’t benefit anyone, including the client. Can you imagine a billing attorney, who might be billing a few hundred matters (or more) each month generating cover letters for matters where he/she possible didn’t even do any work? Remember, we are hopefully using our billing attorneys to better manage projects and push work down to the lowest practical and competent level.
The client billing process, in many firms is based on a slow, painful monthly schedule. Why … because it’s always been that way and adding a cover letter to the front of a bill is not a step in the right direction. The firm might be better off setting up a policy that says a billing attorney must call a client, on every final bill after a matter has closed or any bill over $xxxx dollars to explain it personally to the client.
In summary, cover letters on bills really don’t serve the intended purpose and only delay the firm’s cash flow.