A new paradigm has emerged for Corporate Legal Departments and Law Firms, which poses cultural, operational, and technological challenges for both organizations. With corporations demanding fiscal accountability from their in-house legal teams and outside counsel firms, procurement departments are being engaged to help law departments leverage the power of data-driven decision-making to source external legal service providers.

All stakeholders, from legal departments to law firms, must learn to address the unique perspective of corporate procurement departments. Success in this environment demands a willingness to compromise, revise, or even eliminate long-standing practices in order to operate more efficiently. Ultimately, the goal for the legal department, procurement department, and law firms is one and the same: to receive and deliver the highest possible value for the legal services provided.

There are several objectives that General Counsel and other corporate leaders typically have when they engage their procurement team in securing legal services. The most common is a reduction in the roster of outside counsel law firms, a process known as convergence. This step can obviously help minimize the overhead that comes with managing a high volume of law firm relationships. But the greatest value in convergence is the ability to truly make the law firm a partner to the business. With a reduced panel, legal departments have more time to share the business objectives with the firm and collaborate to help law firms work towards those goals.

In addition to law firm convergence, the procurement department can also help in-house teams with:

  • Reduction of duplicate work across regions
  • Improvement in coordination between firms to achieve the best, most consistent outcomes
  • Ensuring that the volume of business the corporation and firm do together is reflected in pricing
  • Finding ways to improve transparency around rates, AFAs, and pricing in general

While preparing for procurement-aided discussions, law firms and legal departments should both have reliable market and internal data available for reference. Specifically, they should have industry benchmark data to compare proposed pricing against, along with their own historical matter data from an enterprise legal management (ELM) or practice management system, which can guide both parties’ expectations of future cases.

When procurement professionals help to put the focus on value, it can support legal department efforts to improve outcomes and pricing, and can help law firms solidify their places in the corporation’s preferred panel of providers. Then both in-house and outside counsel attorneys have more time to focus on their primary concern – the matters themselves.