A few days ago I ventured to list in order of respectability why legal departments don’t aggressively control costs of their law firms (See my post of July 21, 2011: 14 reasons.). I am gratified two readers added their thoughts.
John Conlon pointed out “that many of the corporate in-house attorneys come from the very firms they are supposed to be ‘regulating’ or come from big firms with the same billing models. Thus, they truly do not know any better.” I would add that it is hard to crack the whip on your former partners, be they former authority figures or colleagues.
Conlon added that “the very idea that legal bills could be reduced somehow is perceived as a challenge to an in-house counsel’s ability as a lawyer. It is as if someone says, ‘you have not been doing a good job as a lawyer.’” Again, I agree. If you give good instructions to a law firm and keep on top of their efforts, how often should you have to ask them to cough up time?
John Bentley of Target also commented. “Somehow, #2, #3 and #7 [little internal pressure to cut; quality and outcome matters more than cost; and long-term knowledge built up by firm] do not seem to be as significant of obstacles when applied to inside counsel. Perhaps one reason for this is the availability and importance placed on internal performance metrics, and the relative lack of data available (or willingness to use what is available) for measuring outside counsel.” I agree with John that comparative data from multiple companies for evaluating outside counsel is very hard to find.