Last year Bank of America predicted almost perfectly that its legal budget would be $1.3 billion, according to this recent post on LexisNexis’ Business of Law blog. How did BoA do it? Through fixed fees and what LexisNexis calls “the science of prediction.”
According to the post, BoA identifies outside law firms in regions around the country. Then it estimates how many matters each of those law firms will handle. Then a fixed fee is set. A BoA legal operations managers described to process like this: “We’re going to predict that we’re going to have 500 matters in the Northeast region every month, and we will pay you X dollars per matter for 500 matters and we’ll give you that money whether it’s 400 or whether it’s 600.”
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