The extended economic dry spell has forced all sectors of industry to rethink how they purchase products and services in the endless hunt for cost reduction and competitive advantage. This applies to everything from office supplies to executive compensation. Because legal services are expensive and difficult to predict or control, they are even more likely to be scrutinized and re-evaluated. In the past, legal fees were considered part of the cost of doing business, but now CEOs want those costs cut.
As a result, many GCs are abandoning old, often inefficient methods for buying legal services in favor of more business-oriented solutions that result in better value for each legal dollar spent. Broadly speaking, the old strategy of hiring multiple firms based on deep personal relationships is giving way to the more consolidated purchase of more services from fewer firms based on merit and price. Ironically, the new law firm roundup is leading GCs to actually round down the number of firms they use. Gone are the days when old friendships, strong reputations and specialized services were enough to keep outside counsel on the payroll year after year.
