Image by Shutterstock Association of Corporate Counsel's 2018 Corporate Counsel University

1. Buying it? Know what it is. Lynn Watkins-Asiyanbi, associate general counsel at JBT Corp., said the first thing that should be done with outside counsel is to establish billing guidelines. Watkins-Asiyanbi said that if a department does not create any kind of billing guidelines, law firms will be spending money on items like photocopies, phone calls or faxes, which Watkins-Asiyanbi said, "in this day and age, I'm not paying for.” She said there should be an engagement letter and billing guidelines set up.
2. Don't be afraid to ask for data. “I know a lot of in-house departments when they start on the path of trying to figure out how to manage outside counsel, they really struggle because they feel like they have no data,” said Bindu Cudjoe, deputy general counsel and chief knowledge officer at the Bank of Montreal. She said she started asking law firms she worked with for their data because they tend to keep records on clients. “Suddenly we have data that we didn't have before, they had data ... but never thought to look at,” Cudjoe said.
3. Keep politics out of firm selection. When scaling down from 1,000 firms in 2012 to 200 in 2014 and down to 100 by 2017, Cudjoe said she and her team made sure it was clear that the firms they put on their panel lined up with the bank's values. She also made sure that old friendships between in-house lawyers and outside counsel would not be a factor in selection. Watkins-Asiyanbi agreed, “This becomes political. Everyone wants their friends to be a part of the RFP process selection. You need to be very clear—not one person is going to be favored over any other firm.”
4. Be aware of your bargaining power. Cudjoe said that in Canada, the Bank of Montreal is considered a pretty big deal. Therefore law firms in Canada are seeking the bank's business left and right. But firms in the United States, on the other hand, have bigger clients they aspire to snag. “You have to understand what you can get and where your leverage is,” Cudjoe noted.
5. Panel building is a journey, but it's worth it. Re-examining a company's panel of outside counsel should be done every two to three years to help control spend and scale back on the number of firms the legal department is using, according to the two attorneys. Both said that it takes a significant amount of time to scale back on legal departments and go through the RFI and RFP process to reshape panels. But they agreed it is something that someone on the in-house legal team needs to do because departments best understand what the business needs.