In life and love and yes, in business, it's the relationships we make that make all the difference.
We all know this intuitively, the better the relationship, the more likely it is to create beneficial results. Now, the 2018 Buying Legal Procurement Survey offers insights into its significance. Procurement professionals describing the relationship with their colleagues in the law department as “partners” were able to achieve 21 percent in savings on average.
Those who described the relationship with in-house counsel as “collegial” saved 15 percent on average, while those with “reluctant relationships saved only 7 percent on average. Those with non-existing relationships (“What relationship?”) on average saved 9 percent.
After tenure, it was relationships that proved to show the most savings. Time, well, takes time, and so do relationships, but we offer some tips below to forge and build authentic relationships with the legal department.
Tips to building authentic relationships
Start with your CPO. Start the conversation with the top leaders in both Legal and Procurement. Gaining the General Counsel’s support is the quickest path to success in getting the access to data you require. The GC and the CPO can build initial savings targets together and establish a charter.
Mine Legal Ops. Build a relationship with them and align with their goals. They have the data you’re looking for. They usually control the billing system, matter management, and maintain relationships with both inside and outside counsel.
Start small. In an environment where Procurement is usually not seen as a help, starting small can yield greater benefits. Run a small, quick RFP* and show what happens when you competitively bid and negotiate with a law firm’s sales/pricing team. Starting small, can win big.
For more tips on relationship building (and more), check out Getting Started under Cheat Sheets in the membership section of our site.
* Members see our series on Getting RFPs Right.
Law Firm Relationship Management is the concept of formalizing relationships, goals and
objectives between the law firm and the law department. We've outlined it for you in the Legal Spend Management Primer. In this primer, Peter Eilhauer and Matt Todd of Elevate Services introduce the Legal Procurement Matrix and detail the pros and cons of different cost-savings initiatives.
There are many Legal Spend Management initiatives that law departments can undertake, ranging from simple process or policy changes to more complex and comprehensive programs. Each initiative can deliver cost savings for the company and offer certain performance benefits. Different initiatives also have varying time horizons and may be better suitable for certain organizations and cultures than others. Which initiatives will bring the
fastest results, best outcomes, and cause the least disruption (and take less convincing of
stakeholders)? They show how you should prioritize and strategically approach legal spend management.
Law Firm Relationship Management & Business Reviews
Business reviews are an important part of relationship management as they help set expectations and facilitate developing a mutually beneficial relationship. While the content of a business reviews depends on the maturity of the relationship with the firm, a full review includes:
A quantitative review to analyze spend trends and cost variances. This is often the first step.
Once clear spending expectations have been set, the focus can shift to include a qualitative review, measuring performance against company-defined goals or service levels.
A mature 360-degree relationship will include a collaborative review with shared goals, aimed to identify or track progress on common initiatives.
Regardless of the stage of maturity, the business review should focus on driving results. Any data presented should tell a story and drive the participant to a decision, by identifying wins,
communicating gaps and resolutions, or moving forward a mutual goal. For access to the full primer which includes steps on How to make it happen, and How to mange it, click here.
Seriously, don't miss it! We've got answers!
Buying legal services is quite the challenge. Dial into our peer-to-peer calls: ask experienced legal procurement professionals anything you want to know about best practices and "how-to's". Our next call is 23 May with Mark Greene (Market Intelligence LLC) who will discuss Legal Tech Trends. Please click over to our the BLC site to see the time of the call in your region.