Legal departments are consciously driving change and leveraging outside counsel guidelines as one of their most effective tools to do so. Law firms, on the other hand, are lagging in their response, mired in manual processes: Billers are printing invoices for manual notes to be edited by partners and returned to finance. This would be OK if the guidelines were short, clear, partners were reading them, and billers could tie billing to them—but little of this applies.

This means that the rules for payment are locked inside of a complex document, and no one inside of the law firm has the key. Bills are getting kicked back for non-compliance, payments are delayed, bills are appealed, fees reduced, and write-offs are the result. This directly impacts collection realization and top line revenue. This isn't going to get better—for law firms, that is, unless they do something substantive about it.

As a cost center, departments are under tremendous budgetary pressure to control spend and this pressure flows through to their law firms. The evidence has poured in as survey after survey has demonstrated that the greatest impact legal departments can have on controlling costs is through better management of outside counsel guidelines. It is important to note, though, that the majority of legal department professionals—62 percent (see Consilio's Annual Law Department Operations Survey)—see their primary role to be change management, not expense management. They embrace innovation, including workflow and automation of repetitive tasks, and they turn to technology to create operational wins.