by Jan Malasek | Apr 13, 2022 | Strategic Sourcing
Managing professional services spend is always a challenge – often vendors have deep relationships with key stakeholders within a company that can lead to suboptimal engagement of the right external capabilities and diminished value. To be successful strategic sourcing must use data and a fact-based approach in close collaboration with key internal stakeholders to deliver the optimal results – here is an example of F500 company Legal Sourcing exercise that delivered significant savings for the organization. SITUATION The Corporate Legal department had over 200 law+ firms servicing their various corporate needs. Numerous firms were one-time use only, many were engaged for one case only, and others were routinely given new cases due to an existing relationship with the firm or one of its lawyers, and not based on their core capabilities or the best value provided. The company did not have formalized guidelines or procedures in places to manage legal spend – each law firm was managed individually, or even worse, each case was managed differently. There were no negotiated rates in place for external counsel. An e-billing system was in place, but was used poorly and often not at all. A new General Counsel joined the Company with one of key goals of applying cost management practices to law firms and external services as part of Company’s overall profitability drive. He was supported by the Category Lead, Jo Ellen Hatfield, a member of the OnDemand Professional Network. APPROACH First, to gain an understanding of how firms are selected and assigned a case, Jo Ellen met with Legal team leaders of each practice area to understand their key requirements, and their process for selecting, engagement and...
