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Unbundle – use specialists firms for tasks outside counsel have traditionally done

I define unbundling as law departments removing from law firms tasks commonly handled by them and instead retaining specialists to handle the tasks. Examples abound on this blog (See my post of May 14, 2005: photocopying; Jan. 28, 2007: medical/nurse analysts; April 9, 2006: contract and temporary staff; Jan. 16, 2006: legal research; Oct. 20, 2005: settlement counsel; Oct. 24, 2005: decision analysis specialists; July 4, 2006: trial consultants; and July 14, 2006: class-action claims firms.).

Sketchy estimates put the disbursements of law firms that might be siphoned off in the range of five percent of what is paid them (See my post of April 18, 2005: possibly 5% of external spend; and Sept. 13, 2005: estimate for services eligible for unbundling.).

Providers of unbundled services are beyond numerous. Much of what I have written about the cottage industry serving law departments applies to this notion of having law firms do what they do best and selecting other providers for the remaining tasks (See my post of June 11, 2008: cottage industry with 34 references.). Litigation support and offshoring present many opportunities for unbundling, but both topics are beyond the scope of this post.

A different idea than unbundling is to reduce the costs of what law firms spend on disbursements, such as for court reporters, travel agents, messengers, hotels, and rental cars. For expenses such as these, law departments can negotiate master contracts with service providers or require firms to use corporate facilities and personnel (See my post of July 31, 2006: national contracts with vendors; July 20, 2007: save costs on airline fares; and Aug. 20, 2006: more examples of over-arching agreements with service providers.).