Why might a general counsel send all the work in an area – such as environmental, patent, ERISA, or employment (and some or all of the inside staff doing it) – to a single law firm on a fixed fee basis? Why outsource an area of work?
To reduce costs: my experience consulting on seven outsourcings is that the savings can be from 10-20 percent from the extrapolated total spending projection
To improve service: law firms with sizeable practices have a broader and deeper array of talent to assign to matters according to the different complexities of the matters
To solve staff problems: the in-house staff in the practice area are weak, or poorly lead, or suffering turnover, or have morale problems
To stop being a conduit: the outsource firm’s lawyers work directly with clients, rather than serve through the in-house lawyers
To focus on core competencies: the law department can focus on the most important legal issues of the company, rather than devoting management time to peripheral specialties