58 LEXPERT MAGAZINE
|
APRIL 2016
| IN-HOUSE ADVISOR: DATA METRICS |
decisions and how to make it resonate with
the people who are actually retaining the
law firms."
Milojevic maintains there's a "discon-
nect" in large in-house departments be-
tween the teams that come up with the
metrics, typically the legal operations
teams, and the decision makers.
Stock echoes this. "Relationship-based
selection is still the way most folks pick
counsel," he says. "e people in legal pro-
curement love the metrics, but lawyers have
a cultural overlay that militates against
widgetizing legal services procurement."
e challenges may be even greater for
the 50 per cent of law departments in Can-
ada and the United States that engage four
or fewer lawyers.
"It's tough to shout metrics at small law
departments, apart from figuring out what
they're paying their lawyers, because met-
rics only make sense when you have the
volume and type of data that lends itself
to sensible analysis," says Rees Morrison, a
New Jersey-based consultant with Altman
Weil, Inc.
And while there may be plenty of data
out there, its reliability can be question-
able. "I find that the data available to make
dependable or truly informed decisions is
very weak in the legal market," says Fried-
rich Blase, Global Director of Pangea3, a
omson Reuters legal outsourcing com-
pany based in New York.
Morrison has also surveyed the data col-
lection practices of 130 law firms and law
departments. "Most respondents are meth-
odologically unsound both in collecting
data and in how they portray it," he says.
STILL, because data metrics are making
headway generally, they are also making
headway as a tool for choosing and evaluat-
ing counsel. While, as Stock says, counsel
selection may still be a largely relationship-
driven exercise, the process is bound to
change: because expertise is displacing
reputation as a driver in the choice of law
firms, information is bound to become
more and more crucial.
Indeed, the Blickstein Group's 8th An-
nual Law Department Operations Survey
found that 56 per cent of law departments
surveyed had some sort of formal metrics
program in place in 2015, up from 34 per
cent in 2014. Although the programs were
not necessarily directed to choosing exter-
nal counsel, there's little doubt about the
direction legal departments are headed.
On the technology side, companies like
Lex Machina, Sky Analytics and Serengeti
are aggressively collecting benchmarking
and industry data to support their pro-
grams. On the user side, automobile manu-
facturer GM and the Marsh & McLennan
Companies, risk managers and insurance
brokers, are two companies that have led
the way in using data metrics as part of the
counsel selection process.
"Metrics have really only taken hold
in the last couple of years, but since then
there's been significant growth," says Ben-
nett Borden of Drinker Biddle & Reath
LLP in Washington, DC, where he is not
only a partner and litigator but also the
firm's Chief Data Scientist, responsible for
Drinker Biddle's data analytics strategy.
"Clients are looking for more and more of
that type of information."
A similar trend is emerging in Canada.
"Clients are definitely starting to use met-
rics to select counsel and manage our per-
formance," says Judith McKay of McCar-
thy Tétrault LLP in Toronto. "What they
measure is what matters to them, but we
use that information for our own benefit
as well."
Increasingly, the information measured
is subjective in nature. "We've been scored
on things like how responsive we are, the
quality of our work product and the extent
to which we employ strategic thinking,"
McKay says. "ese are things that are hard
to measure with specific data but they can
be scored numerically."
On the quantitative side, clients may be
interested in the number of alternative fee
arrangements being offered, the extent of
the law firm's experience with AFA, the na-
ture of value-added services, the firm's over-
all diversity profile as well as the profile for
the team working with the particular cli-
ent, and how well the firm has conformed
NATASA MILOJEVIC
>
TD BANK GROUP
We meet with the strategic
firms semi-annually, we go
over the spend and how it
translates across practice
areas, then compare that
to the value-added services
we've received and how we've
leveraged them. All of that
helps the conversation about
how and where the firms
can do more for us.
ILLUSTRATION
BY
EVA
TATCHEVA
