Up Front
KNOW How
Can Your Firm Make Its Clients Happy?
By Janet Raasch E
conomists may have declared that the Great Recession is officially over, but many businesses and their legal service providers would probably beg to differ.
Over or not, the Great Recession has dramatically changed the traditional relationship between legal
departments and outside counsel -- in ways that are likely to continue even as the economy improves. Long- standing grievances have risen to the surface.
Businesses and general counsel understand the parameters of this new relationship, but many law firms and lawyers do not.
After years of immunity from corporate cost-cutting efforts, 85 percent of general counsel are now being asked to cut their budgets. Only 26.2 percent of them believe that outside counsel are sensitive to their budget constraints.
To control costs, general counsel are bringing more legal work in-house and, in many cases, using non-tra- ditional providers of legal services. For example, they are turning to cost-effective legal process outsourcers for much of the work previously done by young law firm associates – and asking their law firms to work with these alternative providers for services like e-discovery, document review and even depositions.
For work that requires a law firm, general counsel are moving some matters from costly big national firms to reasonably priced mid-sized regional firms.
“General counsel are facing unprecedented pressure to control costs,” said Kent Zimmermann. “They are demanding discounts, more-predictable alternative fee arrangements and better service from outside counsel.”
“If general counsel do not get what they want in this buyers’ market – they are more than happy to shop around,” said Zimmermann. “Despite the common misperception within law firms, only 13 percent consider their current law firms ‘indispensable.’ More general counsel than ever are switching their primary provid- ers.”
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