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Legal costs under pressure: what is the solution?

Posted by Tim Cummins, President of IACCM, Professor, Leeds University School of Law; Chair, International Commercial & Contract Management | Apr 11, 2018 2:57:00 PM

There is extensive discussion about the cost of hiring a lawyer. At the Codex event last week, hosted by Stanford law school, a number of presentations focused on ways that new technology will tackle the issues of cost and accessibility to the law.

Several speakers spoke of the inevitable pressure on hourly rates and alternative charging arrangements.

Broad issues of social access to the law are not the only questions affecting the legal community. In-house groups are also facing increased pressure to control their spend – and this is at a time when workload demands are increasing.

While some are looking at opportunities to cut workload through delegation (and new technology will increase potential for this), there are a variety of other mechanisms available. These include:

Greater discipline in reducing spend with external counsel (i.e. fixed fee arrangements, detailed billing reviews, panel discounts)
Greater in-sourcing of legal work formerly done by external counsel
Delegation of legal department tasks to others in the business
Introduction of new technology to simplify / automate legal workload
Use of lower cost resources through ‘captive’ legal centers
Use of lower-cost resources through outsourced third party legal services providers

While there are a variety of cost reduction mechanisms available, a key question is what impact these have on departmental efficiency and effectiveness. For example, outsourcing to low-cost locations and efforts to develop alternative fee arrangements have generated mixed results. So what are the best steps to take?

IACCM is conducting a survey to test which mechanisms are being used by in-house legal groups most often and how effective they are proving. The challenge of matching resources and workload will not go away, so finding the best answers is of growing importance. This confidential survey will provide participants with valuable insights and benchmarks.

To participate in the survey visit

Topics: contract /commercial management, legal, contract management

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