The Association of Corporate Counsel (ACC) and Serengeti Law released their 8th Annual "Managing Outside Counsel" survey last month, revealing some interesting trends in the inside-outside counsel relationship.
According to their findings, over the past 8 years in-house counsel have been more demanding of their outside counsel. The study suggests that in-house has taken on the role of manager to outside counsel to heart and has opted for a variety of measures to ensure competitive productivity. It shows that while the median spending in-house is at one of the highest levels in eight years, median spending on outside counsel is at its lowest level.
How in-house counsel is expecting more from outside counsel:
- engage in convergence
- issue competitive bids for new work
- require minimum levels of experience of associates working on their projects
- seek discounts for early payment of bills
- systematically evaluate the performance of their outside counsel
The survey, which is in its eighth year, provided some overall trends observed over the past years.
- in-house counsel are setting more rules for their relationships with outside counsel
- in-house counsel are terminating relationships with their underperforming outside counsel
- budgets are widely used to clarify expectations & monitor performance
- in-house counsel are more carefully monitoring work that is outsourced
- in-house counsel are using more sophisticated technology to track the activities of outside counsel, and have plans to do more
- convergence continues to be common, but often just meets expectations
- although hourly rates still predominate, many corporate clients are getting discounted rates
- although in-house were having some effect on keeping the increases in hourly rates low, hourly rates are increasing again, leading to less work going to outside counsel
- outside counsel spending has been a top concern of in-house counsel, but it is being surpassed by those business activities with legal implications
- in general, in-house counsel have not yet put the necessary systems in place to meet their new reporting obligations