LexisNexis a leading provider of content and technology solutions in the legal research field has recently published outcome of its latest LexisNexis Martindale-Hubbell research on law firm and client relationships in the Western European region. The report titled – ‘The Selection and Retention of Law Firms in Western Europe’, indicates that the quality of law firm’s team and expertise is of secondary importance as opposed to commercial awareness during the initial selection process.
The study demonstrates that the most important initial selection factor for in-house corporate counsels when choosing law firms is the knowledge and understanding of their particular corporate business model, business goals and corporate culture. The study was conducted between January and February 2012 in association with the Global Legal Post and includes personal feedback from 219 in-house corporate counsels from across 16 Western European countries.
Quality over cost
The report clearly indicates a trend for quality of work rather than its cost. The crucial factors for choosing a particular firm in the eyes of corporate counsels included:
- Commercial awareness;
- Client feedback and satisfaction;
- Responsiveness and communication;
- Interpersonal skills of individual lawyers dealing with counsels’ cases;
- Legal expertise.
It is apparent from the above that surprisingly legal expertise forms only a part of wider selection criteria. Nearly 61% of corporate counsels in the UK indicated that they would be likely to base their decision as to whether or not to retain a particular firm based on human relations with individual lawyers that they worked with. Important also is the lack of concern for costs as such. The counsels clearly were more likely to base their initial decisions on the above factors rather than the cost per hour. The rates and approach to billing were however mentioned in the retention selection process. Also lack of transparency in billing and poor customer service were revealed as the most influential factors when it comes to striking the firms off the list of trusted legal services suppliers.
What are the numbers?
Below are selected most influential criteria. The list is not full and should you wish to access more data please refer to the original report.
Initial Selection Factors:
- Commercial awareness in respect of particular organisation and business field – 72%;
- Ease of communication and quick response times – 56%;
- Legal expertise – 54%.
Retention Decisive Factors:
- Team’s expertise and overall quality – 80%;
- Commercial awareness – 76%;
- Costs and approach towards billing – 71%;
- Lawyer expertise 62%.
The in-house perspective
Corporate counsels have indicated also some of the challenges that they face on a daily basis and motivations behind their selection criteria. Although, costs were not indicated as primary selection factor in-house counsels have indicated that internal cost control within their departments is becoming increasingly important. Over 43% of counsels believe that their legal budgets will remain at the same level of the future 12 months despite raising levels of workloads. Majority of counsels have also indicated increased importance for good in-house legal risk management procedure as a way of avoiding potential litigation and keeping the overall costs down.
Whereas the report revealed that only 25% of law firms offer regular face to face work progress reviews with in-house counsels, the majority of those interviewed have expressed that they would like to have more 1 to 1 meetings with their external advisers to review the work and discuss their cases from commercial point of view.
It has also been recommended that law firms spend more time on evaluating client feedback as despite the fact that all firms expressed their willingness to participate in client satisfaction programmes, less than 50% of the law firms actually do thoroughly review the results of such surveys.
This post supplied by Gannons, corporate lawyers based in London.