How does your organisation handle COVID-19?
For clarity, ‘organisation’ here is in-house.
Tracking the responses to this question over a six month period (see graph above) has been interesting.
- Extending payment terms; which I thought would have ballooned, has actually contracted.
- Ask for (additional) discounts; which I would have thought would be leading the pack, has actually held relatively steady.
- Bring more work in-house (outside of a blip in June) has held relatively steady. But more on this one in a second.
- Hire alternative legal providers has actually ballooned, and may go some way to explaining why may believe the alternative legal services providers have been the real winners from COVID-19 – there time has come.
- Renegotiating terms with law firms – more on this one below.
- Pushing non-urgent work to a later date. No surprises with this one, makes perfect sense.
- Cut non-essential costs: this one has shrunk relatively significantly since April. Not sure if that tells us there isn’t much ‘fat’ in in-house teams?
- Reduce internal head count; is on the increase again and would seem to suggest a conflict with the “bring more work in-house” response above. Alternatively, in-house teams are really busy at the moment, which coupled with the rise in the use of alternative legal providers could well be very true.
Anyhow, the purpose of this post was to remake on the significant rise in clients ‘renegotiating terms with law firms’.
While this BLC reports (from what I could find) doesn’t define how this renegotiation process is happening, my experience has been that since May of 2020 there has been a significant increase in pitch and tender activity. Many clients are looking for significant savings and are looking to lock law firms into those savings for lengthy periods of time.
And I would have to say that I expect this trend to grow, so if you are a private practice lawyer who hasn’t yet locked-in expert pursuit/pitch/pricing expertise, you’re probably in for a rough 2021.
In any event, keep an eye on BLC – seeing where this trend tack us will be interested in the coming months.
As always, the above represent my own thoughts only and would love to hear yours.