Cracking the Code: Tips for Implementing Task Codes - Types of Codes

By Heather Ritchie posted 10-23-2018 10:27

  

Cracking the Code: Tips for Implementing Task Codes
Types of Codes (Part I)

Imagine a typical day. A client calls asking how much it will cost to take a litigation matter through trial. An RFP instructs you to give a budget for each phase of an asset purchase transaction. A partner needs to report on the progress of a client’s matter against budget. If you have not yet established a pricing program, answering any these questions, not to mention achieving successful pricing outcomes, could prove challenging.

While most law firms have years’ worth of docketing data, much of it consists of free-form narratives. Making sense of these narratives and identifying trends, without an advanced artificial intelligence (AI) tool, can be daunting.

How can law firms bring structure to this unstructured data and transform it into information that can be efficiently analyzed and translated into actionable outcomes?

Implementing task codes is one way (assuming the firm’s financial system accepts codes). Task codes can help a law firm identify and compare similar matters for pricing estimates, create more accurate budgets based on phases, and monitor matters against budgets. Task codes can also signal process improvement opportunities by highlighting areas where costs could be lowered using technology (e.g. due diligence software or document automation tools) or Knowledge Management resources.

Task codes are not new. Clients with e-billing have instructed their law firms to use the Uniform Task-Based Management System (UTBMS) and other systems for years; these systems provide consistent, standardized data that helps clients analyze, understand and better compare costs and duration of legal work across service providers. Some law firms have developed their own internal, custom code sets tailored to their practice areas, while others have adopted a hybrid of UTBMS codes supplemented with their own variants.

UTBMS vs Custom Codes

UTBMS

The UTBMS has code sets for a number of areas including litigation, counselling, projects, bankruptcy, mergers & acquisitions, and workers’ compensation matters. Adopting UTBMS can get your pricing program started quickly - bypassing the process of mapping out the phases and tasks for each type of matter, soliciting input on terminology and building consensus which can be time-consuming.

In firms already using UTBMS codes for certain clients, extending UTBMS codes to other clients requires minimal additional time, with little or no adjustment to the financial system. Equally beneficial, timekeepers don’t need to learn multiple code systems, i.e. one for e-billing clients and one for other clients.

On the flipside, some firms may find the UTBMS to be overly rigid. As well, the UTBMS does not provide code sets for all areas of practice; and extrapolating from a code set when recording time is not very realistic. As a result of some of these challenges, the Standards Advancement for the Legal Industry (SALI) Alliance and other similar groups are looking to develop a more extendible and flexible framework.

Custom Codes

Developing and adopting custom codes have a number of advantages including:

Ease of Use - Custom codes may reduce the guess work. Tailored to your firm's practice, custom codes adopt terminology that is familiar to the lawyers in your firm, making docketing more intuitive and increasing accuracy. For instance, UTMBS litigation codes refer to “trials,” but arbitration matters have “hearings.” Providing a custom “hearing” task code could reduce uncertainty, frustration and time required to docket, in turn increasing the likelihood of a docket being classified under the correct task code.

Granularity - Another benefit of using custom codes is your ability to be more granular in areas that are important to your firm’s practice, for example, creating a phase that could be expanded into multiple tasks. Take corporate practice, for instance: your firm may wish to understand the typical costs of preparing and negotiating the primary agreements separately, instead of simply tracking the total time spent on all agreements together as in the UTBMS approach.

Responsiveness – Some firms may wish to use custom codes set to respond to a client’s specific reporting needs. For instance, a client may want to understand how much time was spent preparing a written motion record and supporting materials as compared with time preparing for and attending the hearing of that motion. The UTBMS litigation codes classify all of this time under one task.

Flexibility - Custom codes are more flexible as the firm designs and controls them, changes can be made and new codes can be added to suit your needs. To illustrate, suppose that during a litigation matter, opposing counsel makes a Freedom of Information request. Separately tracking the costs associated with this unanticipated component may be desirable and doing so could be achieved by creating separate codes for these out-of-scope tasks. This would allow the firm to carve the Freedom of Information work from the litigation matter in future comparisons with other litigation matters, and in arriving at cost estimates for similar future projects.

Up Next: In part two, we will explore factors to consider when choosing the appropriate approach for your firm.


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