Three Steps You Can Take to Reduce Your Legal Spend

As a result of current economic uncertainty, in-house legal departments addressing the need to control legal spend are finding it more difficult, particularly with the increasing fees of outside counsel and financial constraints within the organization. While software is recognized as a powerful tool for legal spend management, the market dominance of e-billing solutions has hindered many legal departments from investing in technology, as reported in an article by LawVu. 

LawVu’s 2024 In-House Legal Technology Report reveals that only 21% of surveyed teams currently use legal spend management software, highlighting a significant gap in technology adoption. These are three technology-enabled steps that will make a meaningful and sustainable impact on your legal spend.

The first step is to address the burden of outside counsel invoicing, calling for the automation of e-billing and invoice review processes. It involves leveraging legal tech solutions with e-billing and invoice review to centralize workflows and reduce reliance on manual processes. The goal is to save time and resources.

The second step requires enhancing collaboration with outside counsel through bulk Requests for Proposals (RFPs), scope management, and real-time monitoring of work in progress (WIP). These practices can optimize the entire lifecycle of relationships with external legal service providers, ensuring efficiency, transparency, and cost control from the onset of engagements.

The third step is using data-informed reporting to achieve sustainable cost management with software solutions that capture and present internal and external data in an accessible format. By tracking key metrics such as spend vs. budget, internal vs. external counsel distribution, invoice approvals, and matter types, legal teams can gain valuable insights, fine-tune budgets, and inform strategic decision-making.

A comprehensive workspace approach that integrates internal work processes with the legal spend management solution takes this one step further. It connects the dots between outgoing costs and the broader workflows that generate them.