Many in-house legal departments don’t like change and feel comfortable maintaining the status quo, especially when it comes to their law firms. I mean, why fix something if it isn’t broken, right? Wrong. Our latest webinar on sourcing legal services with our partners at Acquis Consulting really opened up my eyes – here’s what I learned.
You Have a Lot to Lose by Doing Nothing
Without a thoughtful approach to which law firms your department partners with (and why), you can find yourself in trouble. An unmanaged roster of outside counsel causes:
- Internal and external resource inefficiencies
- Negative impacts on department productivity
- Inefficient and ineffective cost management
Ultimately, all of these negative effects lead to more risk for the legal department as well as the organization as a whole.
The Old Way Doesn’t Cut It Anymore
The traditional legal cost reduction approaches are at a point of diminishing returns. Not only that, many legal teams find them to be relatively ineffective. Some reasons for this include:
- Traditional cost reduction approaches typically focus on point-solutions and tactical management with limited scope. Symptoms are addressed, but not the root causes.
- Viable alternatives are obscured by a fragmented and highly complex legal services market.
- Comparing the cost of legal services on a “quality-adjusted” basis is tedious and difficult.
- Actionable insight into the legal market is extremely scarce.
If the old way no longer works, what options do in-house teams have to optimize how they source legal services? The answer is Outside Counsel Rationalization (OCR).
How to Find Success with OCR
What exactly is OCR? It’s a structured approach that objectively evaluates and tests your outside counsel against viable alternatives with the goal of improving quality and reducing costs. It’s complex but yields immediate savings, and higher quality work and greater value from your law firms.
So, what does an OCR process consist of? Here’s a quick overview of the 4 key steps:
- Take Inventory – Understand what you have and what you need
- Set Strategy – Develop a sourcing strategy and establish formal objectives
- Execute Plan – Craft RFIs/RFPs, evaluate contenders, and negotiate with facts and data
- Control and Monitor – Create ongoing “best-in-class” management processes, structures, and roles, then enforce compliance
The Results Speak for Themselves
While OCR is an upfront time and resource investment, it delivers powerful results if done properly. In-house teams can benefit from OCR with outside counsel delivering:
- Faster speed of service
- Proactive communication and account management
- Higher quality of work
- Lower prices for greater value
- More diversity of legal resources
To learn more about OCR and how it can help you, view the full Sourcing Legal Services: Breaking Through the Complexity webinar and hear firsthand from our amazing panel of speakers.
And for legal teams interested in learning more about vendor management, download our white paper, The Basics of Legal Vendor Management. It covers 5 key steps for starting a vendor management program, tips for evaluating your current legal department-law firm dynamic, metrics for evaluating outside counsel, and more.