Outside Counsel Management 101: How Often Should You Review the Performance of Your Outside Counsel?

Whether you task outside counsel with predictable ongoing requirements or you and your team send work out ad hoc, you need metrics to track performance and processes to keep your budget in line and deliverables appropriate.

Developing a systematic approach to performance review can eliminate some financial uncertainty, assist your project managers, and identify key performance indicators (KPIs) to measure efficacy. Good reviews can help you purge, if necessary, or overhaul the process you use with counsel to make it work better and more efficiently.

OUTSIDE COUNSEL MANAGEMENT: THE SECRETS TO GREAT REVIEWS

There is no hard and fast rule regarding your review’s ideal timing or depth. These elements will depend on diverse factors, such as:

• The size and scale of your team. Do you have a Chief Operating Officer or Legal Operations Manager in-house?
• The length and stability of the relationship you have developed. For instance, have you worked with counsel for years and automated many aspects of the relationship, or are you still getting to know one another and trying to figure out how to work together?
• The cycle and timing of the work. Are you engaged in long projects with relaxed timeframes or small projects with tight deadlines?
• Whether you’ve encountered challenges with counsel before.
• Whether you’re working with (or testing out) multiple attorney teams to determine the best fit.
• Whether regulatory or compliance requirements necessitate certain types of reporting.
• The degree to which you’ve solidified your business model. How well do you know what you need from outside counsel? Do you have a clear idea of the ideal relationship, or are you still evolving your business and developing your processes?
• In general, the more problems you’ve had in the past (or you anticipate that you might have, based on experience), the shorter your review timeframes should be. Similarly, the less familiar you are with counsel and your processes and expectations, the more frequently you should conduct performance reviews.

TESTED TIPS FOR MAKING YOUR REVIEWS SUCCESSFUL (AND AS STRESS-FREE AS POSSIBLE, GIVEN THE STAKES):

1. Quantify the expectations of everyone involved. As we touched on before, the more precisely you can identify your KPIs, the easier it is to give feedback. It’s a lot easier to say, “you didn’t meet such and such a number in quarter three” than it is to say, “we are generally unhappy with how you have been communicating.”

2. Solicit internal and external feedback to determine how the performance evaluation process can improve. Don’t assume. Ask good questions. Ask the people inside the process to tell you what could be improved and what works well.

3. Document the performance review process. Even if you’ve worked with outside counsel for a dozen years, and your people know their people intimately, document everything. For instance, someone can quickly fill in if a critical stakeholder leaves. Documentation also lets you improve the process over time. Write down exactly what happens (your “As Is” map). Separately determine precisely how to conduct the review. Then build towards a better process.

4. Use powerful software to automate the review. Explore Onit’s European legal spend management solution BusyLamp eBilling.Space for insights. Our product can help you streamline your outside counsel performance review and strengthen and improve this crucial relationship.