Until I heard a comment during a recent presentation, I had thought that a law department considering a bonus for a law firm would deliberate based on whatever the law department’s lawyers recollected of the firm’s performance and however the matter had resolved. Someone at the presentation from DataCert suggested an alternative.
A different approach would be to ask the law firm to state its case, briefly, for why it should deserve a bonus and in what amount. Then the law firm would have to introspect and pick out what aspect of its services were above and beyond or what results were significantly better than might have reasonably been expected. Much like self-evaluations by lawyers in a law department at the time of an annual performance appraisal, the law firm’s response will be self-serving and well-spun, but it will push the law firm to assess itself somewhat realistically. The firm’s observations will complement the assessment done by the law department’s managers. They will help the law department come to a conclusion about the appropriateness of a bonus payment (See my post of Aug. 4, 2007 on a bonus arrangement.).