TODAY’S GENER AL COUNSEL SPRING 2018
LEGAL DEPARTMENTS LE AD INDUSTRY-WIDE CHANGE BY MERRY NEITLICH
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or more than 25 years, internationally renowned legal futurist Richard Susskind has been researching and opining on alternative ways law firms might work best with their clients. All his books, lectures and keynote addresses have driven home the point that law firms must change from the traditional billable hour and become more focused on service delivery based on client preferences — creating better efficiencies, using more technologies and offering predictability. During that same time frame the feeling grew that law firms were calling the shots — continuing to bill primarily by the hour, grudgingly discussing alternative ways of delivering their services, then raising their hourly rates annually. From the legal department’s vantage an hourly fee-based model does not encourage true partnering because it focuses on profitability for law firms. However, creating alternative fee arrangements generally turns out to be disappointing as well. In-house counsel want predictability as well as efficiencies not available by the billable hour. About five years ago, a group of in-house counsel from large corporations started to meet informally. They
expressed specific frustrations with how their departments were run and surfaced issues surrounding the way legal services were being delivered by law firms. They agreed that legal departments owned a fair share of blame for inefficiencies because they didn’t know how to create an easier and more productive way to work. They started to share information, processes and technologies such as e-billing, e-discovery and knowledge management. In addition, they discussed how they might work with outside law firms to minimize costs, frustrations and repetitive tasks. They expressed a unanimous desire for law firms to approach them about what would make delivery of services better for the client. These leaders became the founders of the Corporate Legal Operations Consortium (CLOC). They included Connie Brenton from NetApp, Mary O’Carroll from Google, Jeff Franke from Yahoo, Christine Coats from Oracle, Lisa Konie from Adobe, Steve Harmon from Cisco and Brian Hupp from Facebook. In 2016, CLOC incorporated as a nonprofit trade association. Since then it has grown to include over 1200 members, 600 member companies and
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ALTERNATIVE FEE ARRANGEMENTS GENERALLY TURN OUT TO BE DISAPPOINTING AS WELL.
Merry Neitlich is the founder and managing partner of EM Consulting. She assists law firms and corporate legal departments in creating strong legal operations programs, and conducts internal client feedback interviews with executives and other clients of the legal department in order to continuously improve internal client satisfaction. merry@emconsults. org