Economic uncertainty is forcing businesses to take a hard look at spending including legal spend. In today’s Guest Post, Aaron Pierce, General Manager of LexisNexis CounselLink, talks about the results of the recent LexisNexis CounselLink 2020 Enterprise Legal Management Trends Report and analytical tools that are available and being used to manage legal spend. Law firms best be prepared to be scrutinized like never before.
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Legal departments are facing multiple challenges now, as the COVID pandemic continues and businesses across many sectors are struggling.
With so much uncertainty in the economy, it is critical for legal departments to engage in meticulous financial management. Effectively managing costs and saving money wherever possible can help mitigate risk that may be coming in other areas of the business. Complete visibility into spend is what makes this possible. Without strong budgets and an ability to track every single dollar, in-house counsel would never know where they might have flexibility that they can take advantage of. By utilizing alternative fee arrangements, systems that provide insights and analytics into spend, strong benchmarking data, and creative billing solutions, legal departments can better position themselves to manage the current environment and whatever comes next.
AFAs Reveal Corporate Counsel’s Shrewd Eye on Spending
Alternative fee arrangements (AFAs) are one area that can provide more predictability into legal spend. Clear insights and strong benchmarking data can help legal departments leverage AFAs more effectively.
AFAs are certainly one area that legal departments are already exploring. A recent analysis of 2019 charges billed by outside counsel reveals that 12.1% of matters this past year were billed under some form of alternative fee arrangement. That is an increase from 9.2% in 2017, according to the LexisNexis CounselLink 2020 Enterprise Legal Management Trends Report, which features year-over-year legal industry trends particularly related