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News
posted 19 Jul 2007
In-house counsel call for better cost control
LAW FIRMS are failing to meet in-house counsel’s expectations of effective cost management, according to a recent survey.
Grant Thornton’s Forensic and Investigation Services found in-house counsel gave firms a score of 55 per cent for managing their costs, compared to the 71 per cent the firms gave themselves.
The results suggested firms were underestimating “how important the parameter of cost really is in terms of what the whole package needs to look like”, according to partner Toni Pincott.
A further disparity in perception emerges when it comes to firms’ willingness to recommend alternative dispute resolution (ADR). Lawyers give themselves a ranking of 89 per cent in this area, compared to the 70 per cent satisfaction suggested by in-house counsel. Pincott suggests in-house counsel can sometimes be “suspicious” firms may not be financially motivated to pursue ADR.
One area firms are close to hitting the mark, however, is in understanding their clients’ own strategic objectives. Here in-house counsel gave firms a score of 79 per cent; only slightly lower than the firms’ own appraisal of 81 per cent.
Separate research from Grant Thornton in 2006 showed companies were preparing to rely less on external firms in the future. Over half (58 per cent) of companies’ legal departments said they were planning to expand their numbers within 12 months.
“In-house counsel will naturally gravitate towards firms that meet their needs and provide added value,” Pincott said.
“In the future, those firms that manage to control their costs, and in the process satisfy their in-house legal clients, will be the ones most likely to survive in the shrinking disputes-resolution environment.”
