An increasing number of companies today involve procurement when selecting outside counsel and ancillary legal services providers. This is particularly true for companies with significant legal spend and in regulated industries; banks, insurances and pharmaceutical companies were among the first to bring in procurement professionals. Now, many Fortune 500 companies and international equivalents bring in legal procurement to support the legal department cut costs, ensure quality and drive efficiency in legal services.
To better understand legal procurement practices and detect trends, the Buying Legal Council®conducted a survey in January 2016. This research represents the view of 92 legal procurement and legal operations professionals.
What the Findings Mean for Law Firms
Legal procurement is still a new profession, but increasingly influential for buying legal services. We expect that legal procurement’s influence will continue to grow in the next few years.
Procurement gaining influence means that firms need to show more efficiency and cost-consciousness. In particular, the large corporate client expects firms to behave like a prudent business partner who continues to innovate and evolve. For many firms, traditional approaches that treat every matter like a unique scenario will have to give way to a more professionally managed, industrial approach. Clients are increasingly expecting firms to apply the learning curve principle to the delivery of legal services. Here’s a list of what you need to do to evolve:
- Speak with your clients to learn more about how procurement works in their organizations, what influence procurement has and how legal and procurement collaborate. Law firms should be aware of procurement’s goals, objectives, challenges and strategies.
- Start building a relationship with your clients’ legal procurement professionals. Most are open to engage with their firms and happy to discuss ways to manage spend and getting the best value from the right firms.
- Embrace the business side of the legal practice: rethink how you market yourself, as well as how you deliver and manage legal services. Procurement professionals demand predictability and project and budget management even more than most general counsel. Understand which metrics are used by procurement when evaluating law firms. Procurement believes that if you know your business, you should know how long it takes to deliver your services and how much something should cost.
- Understand what your client’s procurement department wants and values. Firms can win “points” if they can demonstrate that they solved a similar issue for another client and can hit the ground running without needing to conduct extensive – often expensive – research. Procurement also likes to see industry experience and a robust project management approach as they promise the efficiency procurement seeks. Procurement looks for compliance with billing guidelines. Make sure you deliver what you promise.
Read the article on the Legal Marketing Association’s website and check out the beautiful info graphics!