Metric of the Week (#15): Total Legal Spend by Practice Area (TLSPA)
- jamiemendoza7
- Apr 8
- 2 min read
April 8, 2025
Definition
Where does your legal budget actually go? Total Legal Spend by Practice Area (TLSPA) breaks down how legal departments allocate resources across litigation, contracts, compliance, transactions, and more. Tracking TLSPA helps legal teams see spending trends, justify budgets, and make strategic decisions about where to cut costs or invest more.
Why Measure TLSPA?
Here are some thoughts:
Visibility into resource allocation to highlight key practice areas that command the largest share of your budget.
Justification for budgeting and showing how much funding goes to litigation versus compliance, for example, demonstrates where the department’s focus lies and where additional resources may be needed.
Identifying areas with disproportionately high spending opens the door for targeted cost reductions or alternative solutions.
If litigation expenses are soaring, explore whether pre-litigation settlement, mediation, or other dispute resolution methods could bring costs down.
If compliance spend is climbing, is it because of proactive initiatives (a positive sign) or because ever-changing regulations require more external counsel? Understanding the why behind the number is crucial.
Filters
Depend on your data set, there are many ways to slice and dice this, but here are some examples:
Law Firm / Vendor: Which external providers are driving costs?
Internal vs. External: Is the spend more internal headcount and overhead, or external law firm fees?
Location / Jurisdiction: Are certain regions more expensive due to local regulatory pressures or cross-border requirements?
The key isn’t just only tracking where the money goes, but why.
If you’re interested in exploring this metric further, along with other KPIs, check out my book, Legal Operations KPIs available on Amazon in English, Spanish or Portuguese. or as an eBook on Google Play in (English / Spanish / Portuguese). It covers over 80 metrics and KPIs with practical insights to help you get the most out of your legal department.
Visit LegalOpsKPIs.com for more information, exclusive resources such as expert interviews, a chart library, Excel templates, and to connect with a global community of professionals committed to advancing Legal Operations through data-driven insights.
See this article in Linked here: https://www.linkedin.com/pulse/metric-week-15-total-legal-spend-practice-area-tlspa-mori-kabiri
InfiniGlobe is a full-service consulting and software company. We have 20+ years of industry experience working with top corporate legal departments and law firms. Contact us at info@infiniglobe.com or at (833) LGL-TECH.