Law-firm performance management data and its uses by law departments

During the summer of 2005, Bottomline Technologies, the provider of eXchange, surveyed the Fortune 1000 companies and AM Best 200 insurers. Of the 1,892 individuals sent e-mail invitations to participate, more than 10 percent responded. Thomas Gaillard of Bottomline reported some of the results at ACC’s 2005 Annual Meeting.

The respondent law departments use law-firm performance data mostly to “award new work to high performers” (59% selected this response) and to “reduce the number of outside counsel” (47%). The least important uses of the performance data were to “help firms become more efficient (26%), “internal analysis only” (22%) and to “tie firm compensation to performance.”

It would be commendable if more law departments told their firms how the firms stack up against each other and how the firms should manage differently. That is partnering at a much higher level.