Law firms, law departments and the asymmetry of concern about money

This is a depressing and admittedly cynical view, but let me float the idea. Law firm partners spend much of their time thinking how to increase their revenue. Certainly, they practice law and care about those who pay their bills, but close behind they care about how to milk more fees from current and new clients.

Law departments, by contrast, have part-time managers of outside counsel. Law department lawyers spend the largest portion of their time focused on giving legal counsel. They incidentally manage outside counsel and often have little individual incentive to reign in costs (See my post of June 30, 2007: lack of individual incentives for cost control.).

At bottom, therefore, firms and departments exhibit an imbalanced focus on money. Where many people outside focus on increasing money, relatively few people inside – and only part of the time and reluctantly at that – focus on holding the line.