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6 Things to Consider for Managing Outside Counsel

Strategic guide to managing outside counsel with focus on clear communication, efficient billing, cloud collaboration, and legal technology adoption.

March 16, 2022

Law departments play an important role in connecting administration and operations, in-house counsel and staff, and outside counsel and service providers so that when necessary, key figures can leap into action without delay. Outside counsel firms and other service providers to corporate law departments often go through separate procurement workflows due to the confidential and time-sensitive nature of their engagements. This means that the responsibility of holding service providers up to the same standards and accountable to the same policies as in-house counsel falls on legal operations and eBilling staff. Law departments and their outside counsel need to be on the same page about more than just a project’s parameters. Great relationships are built on trust and communication, so here are 6 areas we suggest you spend some time with your team and your outside counsel to get on the same page.

1) Set the Scope

When engaging outside counsel for a new project, spend time with your team to first define needs and expectations. This will help both parties measure success during and after the project. As much as possible, be specific and provide figures when establishing demands, and where available, ask for estimates of the work, including total anticipated hours and total spend estimates.

Keep in mind that setting guidelines is only the start of a successful engagement. You will need someone that can take time to ensure your agreements are enforced. Encourage firms to take corrective action on their own and after finishing projects, set an evaluation to identify opportunities for improvement.

2) Review Rates

Law departments should be vigilant about reviewing additional rate, timekeeper, and budget requests prior to approval, for instance by reviewing and confirming the experience level of each proposed professional for a new project. Following this procedure can help reduce the cost and increase efficiency. Changes in discounted rates or any other changes to negotiated rates should be reviewed prior to approval as well. It is also best practice to set a threshold for expenses, past which firms should be required to submit additional support documents to eliminate inappropriate overhead charges.

Setting, collecting, and tracking firm budgets is also a great practice for keeping spend on track and an eye on what costs to anticipate. It can also be a good opportunity to quickly review firm workloads and adjust projects as needed.

3) Bolster Billing

Legal departments and law firms alike have always been on the hunt to reduce spend. According to a recent State of the Industry report from the Corporate Legal Operations Consortium (CLOC), 61 cents of every dollar spent on legal costs in 2020 goes to external legal costs – a 15-cent increase from 2018.

One way to effectively monitor spending is to ask firms for more detailed and accurate billing, listing the specific tasks firms are doing to a project can help provide an insight into the matter. Holding firms accountable for poor billing practices like late invoices, block billed line items, and other non-compliant submissions will help eliminate redundancy and time erroneously billed.

4) Collaborate with the Cloud

The use of cloud-based technology has become a big part of most corporate legal departments’ and law firms’ business continuity plans in the past few years. There is a significant shift towards using cloud-based platforms to help staff work together and deliver more consistently to address client needs. Of the respondents in a 2019 American Bar Association survey, 58% utilized the cloud—an increase from 55% in 2018.

By shifting from manual, paper processes to cloud-based technologies like document management, matter management, contract management, eBilling, and other systems, law departments are seeing significant improvements in security, availability, and collaboration, both internally with colleagues and externally with outside counsel and service providers.

5) Reap from the Results

Reviewing results and identifying opportunities for improvement don’t apply only to outside counsel. At the end of each project, take some time with your team to review the things they did correctly, what they learned, and how this matter helps shape the department’s strategic plans and decisions going forward.

For instance, reviewing historical data can be used to reduce future legal exposure and unnecessary spending. Comparing results with previous matters is the best way to see how factors such as cost, time spent, and delivery are achieved and whether they are improving.

6) Legal Tech

Corporate law departments have the responsibility to manage legal spending effectively while operating efficiently. With increasing security policies, compliance regulations, and data protection laws, each with stringent rules to follow and serious consequences for non-compliance that can permanently damage reputations, this can feel like juggling a hundred plates at once.

Using certified legal technology tools to receive, review, process, transfer, and store information takes away the menial manual balancing act work you have to do, like eBilling submission management, or matter intake and record creation, or vendor due diligence expiration and attestation, and lets you focus on the interesting stuff that makes your job what you love to do.

Finding the Right Partner

The rapid transformation of technology is exciting. As it evolves every day, it can feel a bit daunting to keep up with the latest trends. Finding the right technology partner is paramount to your law department’s potential for scaling and success.

We know better than anyone that implementation is not a one-size-fits-all process. Your ideas may require more expertise and professional perspectives than what is readily available. We’re happy to help. Our consultants have decades of legal technology experience working with an impressive array of Fortune 500 corporations. Reach out to us at or (833) LGL-TECH.


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