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3 Things That Are Wasting Your Legal Budget

Virtually everyone across all industries is currently trying to “do more with less.” The legal world is no different. More and more attorneys want to know what investments will actually get returns, and many have become skeptical of pay models that once seemed infallible.

The best legal budgets that “do more with less” are a perfect calibration of technology investments, internal functionality, and strategic outside partners. At Contact, we pride ourselves on helping legal teams find the right balance that works for them. There are certain challenges we encounter over and over again, and today we’re letting you in on some of the common stumbling blocks that result in overspending.

1. Too Many Vendors

There’s often money to be saved by reducing the total number of vendors that you rely on to help you with litigation. Almost any vendor will offer you better pricing on services if you buy more from them. It also mitigates risk to limit sensitive data to as few people/organizations as possible.

The thing is, no managing partner or general counsel wakes up one day and says “I’d like my sensitive data scattered across as many vendors as possible.” So why is it such a common problem?

One issue could be misunderstanding which vendors are capable of what services. If you hired eDiscovery “R” Us for a processing job last month, but no one thought to ask if they also had forensic services, you might go to a separate vendor for this month’s collection. Meanwhile, you could’ve gotten a better deal by bundling forensics and processing together at eDiscovery “R” Us.

Another issue could be overestimating the need for “specialized” vendors. Many vendors position themselves as “specialists” but it’s not always clear if they’re adding more value than more generalized vendors who can do the same job. Such specialists certainly play a valuable role in the eDiscovery industry; however, it can be incredibly difficult for lawyers to decide if a specialist is necessary for a given matter.

Still another issue could be poor communication between team members who are all hiring vendors. Ideally, you don’t want different lawyers each blasting their own unique network of vendors for each new matter. What if Tom, Dick, and Harry each have their own internal investigation? You might be able to get a better deal by buying legal technology services “in bulk” from one vendor rather than letting Tom, Dick, and Harry each pick their favorite from their own address books. 

We recommend having some kind of system that allows all attorneys to pull their vendors from the same pool, and routinely weeding out the ones that underperform or are overpriced. There are even tech solutions such as Contact’s M8™ that are specifically designed to help you with this. It’s also good to have eDiscovery expertise either internally or in a trusted consultant. This expert can help determine if you need to bring in specialized vendors or if giving the entire job to one comprehensive vendor is the better move.

2. Investing in outsourcing rather than training.

As the old adage goes, “give a man a fish, he eats for a day. Teach a man to fish, he eats for a lifetime.”

Oftentimes, your internal team is capable of more than you think, they just need the right training. This is especially true as long as law schools focus on the theory and history of the law but devote relatively little time to teaching lawyers how to use technology.

It’s a waste of money to buy technology your team never adopts, but it’s also a waste of money to pay vendors to do things you could do internally. The best way to walk the fine line between these two forms of malinvestment is usually some combination of the right technology paired with proper training on how to use it.

Sometimes legal teams choose to switch to more modern technology, but grossly underestimate the growing pains of that transition. Don’t make that mistake. Understand that there will be an adjustment period, and give your team the requisite empathy. Ask them what resources they’ll need to become confident on the new solution and act on that intel. Maybe you’ll want to plan training workshops, or temporarily hire some extra support staff that can be on-call to answer your team’s questions. 

3. Paying lawyers to do things non-lawyers could do

Lawyers have hard-earned expertise and deserve to be compensated for it. The most efficient organizations tend to make the most of their attorneys’ knowledge and talent. They can’t do that when those lawyers are stuck sifting through spreadsheets or combing through the internet for trademark violations.

Efficient organizations let their lawyers focus on lawyering. If there’s enough grunt work to justify hiring more support staff, they do. That could take the form of an outside service provider, or bringing on more internal hires.

While it could seem counterintuitive to hire more people when budgets are tight, firms that give lawyers the support they need can usually afford to take on heavier caseloads and generate more revenue in the long run. In corporate settings, the legal department is less of a bottleneck when lawyers have ample support staff.

Every case is different, and there is a myriad of different reasons why you might not be making the most of your legal budget. It’s important to get to the root cause of such inefficiencies and come up with long term solutions that will work for you.  

If you have any other questions about how to make the most of your legal budget, reach out to Contact today.

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