Outside Counsel Management and Rationalization

Outside Counsel Management and Rationalization (OCR) is an approach adopted by many leading corporate legal groups to improve quality and reduce costs. OCR is designed to select and utilize optimal outside counsel for diverse legal needs.

Outside Counsel Management and Rationalization

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Outside Counsel Management and Rationalization: Objectives

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Outside Counsel Management and Rationalization (OCR) is an approach adopted by many leading corporate legal groups to improve quality and reduce costs. OCR is designed to select and utilize optimal outside counsel for diverse legal needs.

Employing a structured process, outside counsel is objectively evaluated and tested against viable "market alternatives", and favorable economic terms are obtained. Typically, management processes are established to ensure the program’s elements are implemented and both quality improvements and savings are realized.

Your first and foremost job as a leader is to take charge of your own energy and then help to orchestrate the energy of those around you.
— Peter F. Drucker, Leading 20th Century Management Thinker

Outside Counsel Management and Rationalization: Overview

Our knowledge of this complex process suggests that there are many misconceptions about the topic. Our experience is that OCR is not “blind cost-cutting” or just selecting firms with the lowest hourly rates. Rather it is a targeted, holistic approach; companies with OCR programs cite improved service and effectiveness.

Outside Counsel Management and Rationalization: Solutions and Savings

With regards to existing law firm relationships, it is important to remember the goal of Outside Counsel Rationalization is to increase the value provided by outside firms. In many cases, the result of the OCR process is that the current incumbent law firm retains the business and no switch is made.  

However, in this situation, significantly more cost effective solutions with the current firm have typically been negotiated as part of the OCR process.  These improved arrangements are not the function of “hammering” on outside counsel, but arming knowledgeable in-house counsel with objective data generated by the OCR process to demonstrate to the current law firm that other viable options exist and improved value must be offered to remain competitive.

OCR initiatives can benefit from the assistance of an experienced outside consultant. Argopoint can:

  • Free up in-house attorneys to focus on more important responsibilities
  • Accelerate the overall process, minimizing time required to realize savings
  • Help avoid common missteps made by other companies

Typical Argopoint roles may include:

  • Help to clarify the overall program objectives
  • Provide initial diagnostic/opportunity assessment
  • Assist with the overall process design and strategy
  • Project management
  • Financial and analytical support
  • Data management
  • Alternative firm research
  • Meeting facilitation and interview support

Key Questions for Corporate Legal Departments Considering Outside Counsel Managment Rationalization

1. Is your legal department getting the best value for the quality of services you receive from outside counsel? How is this objectively measured?

2. Does your legal department work with too many outside counsel firms? Or too few? How do you know?

3. Does your legal department leadership ever feel that there are other “unknown” firms out there that could perform the same services and achieve the same results for lower costs, but does not know how to find them?

4. Does legal department leadership feel that matters are handled inconsistently across all practice areas? Or even within particular practice areas?