Restructuring In-House Counsel's Utilization of Law Firms: Reducing Legal Spend without Increasing Risk

February 2008

Abstract

Traditional assumptions underpinning the outsourcing of all aspects of cases to law firms by in-house counsel should be revisited in view of recent seismic changes in the legal environment. Law firms are no longer presumptively the best qualified or cost-efficient sources to perform many tasks, particularly in the document-related area. The exponential growth of content created by emails and other forms of electronic data has caused document-related activities to be the predominant category of overall legal spend, approximately 70%. Law firms routinely outsource these low-level tasks to third-party vendors and charge a large mark-up for doing so. They also make critical and costly decisions regarding legal technology and also outsource the work. This begs a litany of questions: should in-house counsel restructure the way they utilize law firms? If so, can they take on internal supervision of many of those tasks assigned to law firms that the firms outsource? Can this restructuring be effected without overburdening internal resources and creating additional risk? This article examines those questions and concludes that by restructuring their utilization of law firms, in-house counsel can reduce legal spend as much as 30% without increasing risk.

Authors

Mark A. Cohen

Chief Executive Officer, Legal Mosaic, UK

Mark A. Cohen is a global thought leader and innovator in the legal business industry. He is the CEO of Legal Mosaic (www.legalmosaic.com), a legal business consultancy; regular contributor to Forbes on the global legal industry, business transformation, and leadership strategy) where he has published more than 300 articles; Moderator/Speaker at Economist Impact events; and frequent keynote speaker at international business, legal, and technology events. He has addressed the global legal leadership teams of approximately 60 Fortune 500 companies as well as leading global law firms and foreign sovereign Bar Associations. Mark is the co-Founder and Executive Chairman of the Digital LegalXchange, a global nonprofit community of leading multinational enterprises. The Exchange’s mission is to elevate the impact of the legal function on the enterprise and its customers by aligning it with other business units. Mark was appointed by the Singapore Academy of Law (SAL) to serve as its inaugural LIFTED Distinguished Scholar. He has been a Distinguished Fellow at Georgetown University Law Center and Distinguished Lecturer at Northwestern University Pritzker College of law. He has also taught at Bucerius (Germany), IE (Spain), and the College of Law (Australia). Mark has lectured frequently at leading global law and business schools including: Harvard, Stanford, Oxford, University College London, Kings College, and National University of Singapore. Mark was appointed an innaugural ALM Intelligence Fellow. Mark was a co-Founder of Clearspire, a globally acclaimed pioneer law firm/legal services company that reimagined the delivery of legal services from the customer perspective. Clearspire’s revolutionary use of technology; “two-company model,” and hybrid workforce remain cutting-edge nearly 20 years after the company’s launch. Mark has focused on “the business of law” for the past 25 years. Prior to that, he was an internationally recognized “bet the company” civil trial lawyer. He served stints as a decorated Assistant United States Attorney (Civil Division), BigLaw partner, national boutique founder and managing partner, outside General Counsel (3 excess and surplus lines insurance companies), and Federally-Appointed Receiver of an international aviation parts business. Mark is a Phi Beta Kappa graduate of Vassar College, the institution’s first Rhodes Scholar Nominee. He earned 3 postgraduate degrees from Oxford University as well as a J.D. degree from the University of Connecticut.

Companies

Legal Mosaic

Qualitas Knowledge Management

Qualitas offers law firms and legal departments dramatically lower risks and lower costs of managing legal-based activities. The legal industry is experiencing significant challenges caused by the explosion of documents and email, regulatory changes, the geographic dispersion of work centers, and rising costs. These conditions are of concern to every industry today….calling for a continual search for improved management of legal processes. They also concern many departments within an organization that must participate in responding to corporate-wide events, such as subpoenas for documents or the management of contracts (where the Office of General Counsel often has responsibility for only a fraction of a company’s active agreements).

Businesses of all sectors and sizes require legal advice and risk management. Over time, in-house legal / corporate legal has evolved tremendously from traditional and low on tech department to...Read more

Vikram Pakki

Manager, Legal, Colt Technology Services India Private Limited., India

In-House Counsel’s Guide to Surviving Without Business Travel

Business travel may not return to its pre-pandemic levels for many years, but the need for face-to-face meetings to negotiate complex transactions has not diminished. While technology has helped facilitate...Read more

Todd Krieger

Director of International Transactions and Senior Counsel, InterSystems Corporation, USA

Wärtsilä Legal Hackathon: Case Study

Global in-house legal counsel team embracing innovation and digitalisation. Someone might think that Legal would not be among the first organisations to embrace innovation and digitalisation but luckily in the...Read more

Mia Kärkinen

Senior Legal Counsel, Wärtsilä Corporation, Singapore

Matteo Iles

Legal Counsel - MPS & Sourcing, Wärtsilä Corporation, Italy

Nathalia Meyer

Regional Legal Counsel, Wärtsilä Corporation, China

Sam Ong

Legal Counsel for the Middle East and Asia, Wärtsilä Singapore Pte, Singapore

Metric Programs for In-house Counsel Work

Numbers don’t tell a story. We tell a story about the numbers. In-house attorneys are under increasing pressure to produce numbers – metrics - which measure their work. The pressure comes...Read more

Suzanne Miller

Director and Managing Counsel, HP Inc., USA