My long history with legal firm scorecards (Part 1) By Bill Henderson

The legal industry wants more innovation. The missing ingredient is strong leadership.

Several years ago, a good friend threw me to the lions, though that was not his intent.

My friend, who works in legal tech, asked me to present some legal prototypes I had developed on giving feedback to law firms at the headquarters of a Fortune 100 company.  Cost pressures were rolling downhill to the legal department.  Thus, in an effort to better manage costs, the senior leadership winnowed their outside law firms to a panel of preferred providers.  In theory, the firms were supposed to work cooperatively with each other. If only to deliver world-class quality within a large predefined budget.

From a distance, this all sounded innovative. But up close, implementation was a challenge. The only management tool was an annual rating system that measured law firms on a 1 to 5 scale. (1 = poor, 5 = excellent). Because the performance was aggregated across dozens of lawyers and dozens of matters, the narrative comments were too general and lacking in context to be helpful. Further, all the quantitative scores were clustered in the 4.8 to 4.9 range, making them useless for making merit-based adjustments.  Indeed, if in-house lawyers gave scores any lower, they’d be tacitly admitting a problem with their own oversight.

I had approximately 90 minutes to present my prototype to a room full of BigLaw relationship partners.

Basically, my proposal was to have in-house counsel to complete a monthly survey tool for each significant matter they were managing. (a 10 to 30-minute commitment per lawyer who managed outside counsel). In turn, the results would roll up to a centralized knowledge management system. One that would generate practice group, firm, and legal department-level reports.

Although the proposed prototype required the in-house lawyers to do all the work to generate the feedback. The law firm partners disliked everything they heard. Arguing that the work to review the feedback would be burdensome and counterproductive. One especially vociferous partner remarked, “If there’s a problem, I’d rather have a phone call.”

He would not concede that there was any value to timely bucketing specific examples of good and bad behaviors. As well as that the resulting data could provide a roadmap to help the client and create a factual basis for higher fees.

In-house lawyers looked on in silence as I was pummeled by BigLaw partners.  And in hindsight, I really don’t blame them.  They, like me, were learning the depth of the opposition to systematic measurement of performance.  It would have been a different dynamic if the general counsel was not supervising this initiative. Had communicated that the company was going to use a feedback system to better manage millions in legal spend and that the purpose of this meeting was not to question the premise, but collaborate on implementation.

At this juncture in my career, I had not witnessed many examples of strong and decisive leadership among lawyers and thus did not appreciate how essential it was to organizational progress.  Over the next several years, however, I began to see the pattern.

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