In-house Counsel: Know your outside Firms’ Performance

Aligning Outside Counsel

As a General Counsel of a company, the demands for the legal department to perform as a business unit means the department must align its in-house lawyers and outside counsel to the company’s goals and vision. Utilizing Qualmet’s legal performance evaluation tool, GC’s gain the insights to identify and measure the strongest lawyers and law firms as stand-out service providers to your legal department. Legal performance can be tracked at the Lawyer, Law Firm and Matter level to give GC’s a better grasp of which lawyers are top contributors to the business objectives. Likewise, GC’s can identify potential issues with the lawyer/client relationship before they become a problem.

Matter Management software is not enough

Matter Management tools cannot drive lasting, effective change because they do not truly measure quality or value.  Legal departments are now looking for a next-level approach to manage the firms they use. Measurement and management of the subjective areas of law firm value will provide the foundation for positive changes in performance.

Innovative legal leaders are implementing comprehensive processes to continuously evaluate and manage subjective areas of law firm performance. These leaders have uncovered key factors that allow continuous performance management to drive real change.

  1. Quantify the critical subjective areas of performance. What gets measured gets improved, and leading in-house counsel are measuring the work of outside counsel beyond what’s contained within the details of an invoice. Metrics must address the fuzzier areas of value such as service, understanding of the client’s business, appropriateness of the work effort to the need and the results achieved. Without this there is no context for cost information.
  2. Transparency will align inside and outside counsel. Innovative GCs share the subjective areas of performance that are going to be measured with their outside counsel. They have defined how the corporation sees value. By sharing the metrics with their outside counsel these GCs have already set the expectations and communicated where they expect their partners to focus.
  3. Use benchmarking to create competition. Lawyers are competitive by nature. Industry leaders who want to incentivize their outside counsel to do better work compare the results of their evaluations across firms on the company’s panel. By sharing the side-by-side comparisons with outside counsel can immediately see how they stack up against their peers and where they are falling behind.
  4. Engage in structured dialogue. The fourth factor is the true key to success. Structured dialogue brings in-house and outside counsel together to identify opportunities for improved performance based on performance and identifies specific areas and actions for improvement. The real purpose of evaluation is improvement. There can be no improvement if the results are not discussed and used as the basis for guiding targeted improvement.
  5. Track and share improvement to demonstrate value. Many corporate legal teams find it difficult to easily demonstrate their value proposition to their internal business partners and the CFO and CEO. So much of what is provided by the law firms, that often consume the majority of legal expenses, is intangible and difficult to explain. By effectively measuring, managing and improving the value provided by outside counsel, corporate legal teams can better describe the value delivered and demonstrate effective stewardship of corporate resources.