“Outside counsel are the experts. I am not in a position to second-guess them,” one junior in-house attorney at a transportation company told CEB recently.
This attitude is representative of a much larger and often overlooked problem with getting good quality work from external law firms: in-house staff are either unwilling — or unable — to manage outside counsel adequately.
For example, in-house staff often feel like it isn’t their place to help outside lawyers make important trade-offs – a crucial part of ensuing good quality legal services —and very few do this at all. In fact, nearly 9 in 10 general counsel (GCs) report that they do not evaluate in-house lawyers in this area.
Get Your Team Involved
Many GCs don’t seem to realize how useful their staff can be in boosting the quality of the work they get from external firms, and this is exacerbated by so many in-house lawyers coming from legal firms that advise corporate clients. “I know that firm will do a good job because I worked there for twelve years. I don’t need to micro-manage them,” says a senior in-house counsel at one engineering company.
There are two important but common difficulties to encouraging in-house legal staff to manage external work more closely. First, as one group general counsel at an automotive and transportation company told us: “Some of my lawyers manage outside counsel more successfully than others, but it’s hard to figure out what makes them successful.” And, second, it’s hard to find more time amid the press of day-to-day corporate legal duties.
But not keeping a firm hand on the tiller can lead to some big problems further down the road.
The Problems Caused by a Hands-Off Team
When they began their new roles, the chief legal officer and general counsel at one financial services company in CEB’s network of legal teams faced a department that simply was not hitting the mark on outside counsel matters. The two found high outside legal costs, poor legal outcomes, and widespread dissatisfaction among external law firms.
The culprit, as you might expect, was an ill-disciplined legal team. Chart 1 explains the specific actions (or lack thereof) that contributed to this sorry state of affairs, and the undesirable results.
Chief among these problems were outside counsel not being given sufficient business context surrounding the matter that’s handed off to outside counsel, and insufficient communication between the team and outside counsel throughout the life of a case.
Chart 1: An ill-disciplined legal team Source: CEB analysis