ARLINGTON, Va., June 28, 2012 /PRNewswire/ -- As top partner
rates rise to more than $1,000 per
hour, in-house counsel may find themselves hard pressed to control
their outside counsel spending, according to the 2012 Real Rate
Report, an analysis of more than $7.6
billion in law firm billings. The report was published
by Corporate Executive Board (CEB) (NYSE: EXBD), a leading research
and advisory services company, and TyMetrix Legal Analytics, part
of Wolters Kluwer Corporate Legal Services. Insights in this
report give general counsel a new resource to negotiate rates with
law firms, help them understand what they're paying for and how to
make smart trade-offs through options such as alternative service
providers, smaller markets or smaller firms.
"Despite the recent recession, rates at top law firms continue
to grow, often much faster than legal budgets at corporations,"
said Brian Lee, managing director,
CEB. "However, the Real Rate Report shows that cost control doesn't
have to be a losing battle. By using the information in this
report general counsel can find out if they are paying the right
rate for their legal services or if there is better value
elsewhere. CEB research indicates that by simply looking at
smaller markets or smaller firms, general counsel can often find
high-quality advice at a much more reasonable cost than they could
imagine. Essentially, they won't be paying for premier law
firm office space in the most expensive cities in the country."
The Real Rate Report also reveals that while many general
counsel assume that more work or longevity with a single law firm
will earn them a discount, the opposite is true. While companies
often reap cost savings when initially concentrating work with a
few law firms or reducing the number of law firms they work with,
as time passes they often pay higher rates to the law firms they
work with most or have used the longest. In order to minimize what
general counsel may view as the "creeping up" of law firm rates
over time, companies must continue to foster competition between
firms and alternative service providers and ensure rates are being
examined on a regular basis.
"Based together, both law firm and legal departments need
information to help identify a balanced solution," said
Craig Raeburn, general managing
director, TyMetrix Legal Analytics. "For law firms analytical
insights provide a clear understanding of their competitive
advantage and offer valuable insights into what law departments are
willing to pay, before negotiating."
Driving Toward Cost Control
General counsel can use the Real Rate Report to lower their
outside counsel costs by taking the following actions:
- Negotiate Better Rates – Negotiate rates with law firms
using the actual rates other firms are paying, not published rack
rates (which are almost always higher)
- Better Allocate Work to Law Firms or Alternative
Providers – Decide when to send matters to smaller firms,
smaller markets or alternative service providers to be handled for
a lower cost
- Create Effective Alternative Fees – Build models for
alternative fee structures based on historical costs and models for
similar work
- Enhance Budget Oversight – Set triggers to signal when
spending gets out of control to avoid costly surprises
- Manage Staffing – Set staffing expectations by matter
and matter type using the report as a reference on how other
matters are staffed
The 2012 Real Rate Report includes analysis of more than
$7.6 billion in law firm billings
generated from 2007 through 2011 by more than 4,000 law firms, and
roughly 120,000 billers – including approximately 80,000 partners
and associates. The information used for the Real Rate Report
is pulled from the TyMetrix Legal Analytics LegalVIEW™ data
warehouse, which contains more than $24
billion in legal spend data aggregated from e-billing and
time management solutions of TyMetrix clients and non-clients
alike. Report analysis was conducted by CEB.
A complimentary copy of the report is available to members of
CEB General Counsel Roundtable and CEB Corporate Legal Exchange.
For further advice on managing spend on outside counsel please
visit www.executiveboard.com/real-rate-report or call
1-866-913-8103. To order the 2012 Real Rate Report, please visit
http://wvw.tymetrix.com.
About Corporate Executive Board
By identifying and building on the proven best practices of the
world's best companies, CEB helps senior executives and their teams
drive corporate performance. CEB offers comprehensive data
analysis, research and advisory services that align to executive
leadership roles and key recurring decisions. CEB tools, insights,
and analysis empower member companies to focus efforts, move
quickly, and address emerging and enduring business challenges with
confidence. CEB's client and member network includes 85
percent of the Fortune 500, 50 percent of the Dow Jones Asian
Titans, and 70 percent of the FTSE 100. It spans more than 50
countries, 5,700 individual organizations, and 240,000 business
professionals. For more information, visit
http://www.executiveboard.com.
About TyMetrix
TyMetrix is the global market leader in delivering intelligent
solutions that empower corporate legal departments, law firms and
claims organizations to manage the business of law. It
provides clients with quality legal management software, services
and solutions, including e-billing, matter management and
performance metrics, and the expertise required to manage risk,
reduce costs and gain the insight required to meet their strategic
objectives.
TyMetrix Legal Analytics, a complementary business to
TyMetrix's core software offerings, combines unparalleled
analytical and legal domain expertise with LegalVIEW™ -- the
world's largest permission based contributory data warehouse of
legal performance data -- to provide predictive and analytical
models, benchmarking and insights to legal departments and all
professionals involved in managing the business of law. For more
information, please visit www.tymetrix.com.
TyMetrix is part of Wolters Kluwer Corporate Legal Services, a
business of Wolters Kluwer, a
market-leading global information services company. Visit
www.wolterskluwer.com.
SOURCE Corporate Executive Board