Law Firms Must Improve Transparency and Efficiencies to Meet Changing Corporate Client Demands

CHICAGO, Nov 18, 2016 (BUSINESS WIRE) —
Law firms are seeking strategies to respond to clients’ quest for value
and efficiency while simultaneously increasing profitability.

Corporations decreased outside legal spend by 2 percent as law
departments look to reduce costs and keep more matters in-house,
according to HBR Consulting’s Annual
Law Department Survey.

Leading law firms looking to differentiate themselves in an increasingly
competitive market are paying close attention to law department trends
to build strategies that drive operational efficiencies and align with
client needs, including understanding how clients select and measure
outside counsel. According to HBR’s Survey, the top criteria for
selection of outside counsel was the level of client service and
engagement (79 percent). This was followed by predictability in matter
handling, project management capabilities and creative staffing, and
innovation in fee arrangements. The top metrics for tracking outside
counsel performance are results and outcome, knowledge of company,
communication and billing practice, and compliance with billing
guidelines.

“Leading law firms are holistically looking at the entire lifecycle of a
client relationship – from the outside counsel selection process all the
way through the billing process – and are leveraging client perspectives
to drive change within their organizations,” said HBR president, Nick
Quil. “Areas that may have traditionally been viewed as ‘back-office’
support functions, such as IT and procurement and billing, are becoming
strategic points of differentiation for many law firms.”

As corporate clients increasingly pursue strategies to do more with
less, law departments are focused on optimizing internal resources and
leveraging technology to increase operational efficiency, and they
expect the law firms that they work with to do the same. In response to
client pressures and emerging competition, almost every decision leading
law firms make today is rooted in improving
service delivery and demonstrating increased value for clients,
including:

Improving visibility, transparency and billing practices. Leading
law firms are prioritizing immediate visibility into the budget of
matters. As law departments look to further control costs and minimize
any billing surprises, corporations are looking to select law firms that
are creating models that provide transparency into the billing process
from the onset of matters. The role of the legal secretary and billing
and collections departments are evolving, and in many cases elevating,
to address increasing client demands.

Investing more strategically in IT. According to HBR’s survey, 40
percent of law departments plan to increase their use of technology to
automate routine tasks, enhance work processes and support data
analytics in the near future. As law departments become more tech-savvy
and use data-driven metrics to inform decision making, they are
expecting outside counsel to do the same. Forward-looking law firms are
elevating their IT functions to be more strategic and implement
processes that support the firm’s attorneys in achieving their clients’
overarching business goals. For some firms, this means moving to
third-party IT support in order to free IT leaders’ time and allow them
to better craft strategies that enable attorneys to be more effective in
their roles.

Managing third-party risk with advanced procurement capabilities. Top
firms are looking to improve operational efficiencies and reduce costs
through enhanced procurement functions. But as corporate law departments
continue to focus on mitigating risk, particularly third-party risk, law
firms are strategically investing in support areas focused on
establishing vendor
governance policies and processes to ensure they are meeting
evolving client demands. Additionally, firms are looking to their
procurement departments to create savings to fund investments focused on
transforming the operating model.

For more information on HBR’s Annual Law Department Survey or to arrange
a legal trends briefing, contact HBR
Consulting.

About HBR Consulting

HBR Consulting (www.hbrconsulting.com)
delivers advisory, managed services and software solutions that increase
productivity and profitability for corporations, professional services
and law firms. Thought leaders with decades of experience, we deliver
value to our clients. HBR has long-term relationships working with 90
percent of Am Law 200 law firms and 35 percent of Fortune 500 corporate
law departments.

About the Survey

The annual HBR Law Department Survey is the leading source of
benchmarking data for U.S. and global law departments. It gathers and
reports key qualitative and quantitative metrics that assess and
benchmark law department performance. The Survey, now in its thirteenth
year, continues to grow its participant base and expand its focus on
global legal function management. The 2016 Survey includes a total of
276 participants representing 22 industries.

Unique among law department surveys, HBR Consulting’s Survey focuses on
larger law departments, includes both global and U.S. law departments
and emphasizes data consistency and rigorous quality control procedures.
For more information about how to purchase HBR Law Department Survey
reports, visit http://www.hbrconsulting.com/lawdepartmentsurvey.html
or call 215.628.3409.

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SOURCE: HBR Consulting”>
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