Law Department Management Blog
Have you ever seen a comparison of spending by the major staff groups, each groups spending as a percentage of the company’s revenue? I have not seen multi-company data on spending per billion dollars of revenue for Information Systems or Finance or Human Resources, but I have seen figures from one global behemoth: the ratios stood at approximately 0.8 percent of revenue for the Finance function’s spend, 0.6 percent of revenue for Human Resources’, and 0.4 percent for Legal’s.
The ratios progress neatly, but might there be a rule of thumb that at least ranks the three staff groups in this order? Might the highest account for twice the spend of the lowest? Where would systems support stand in such a ranking?
If law department managers had such a metrics framework, holding their spending ratio up against comparable ratios of other staff groups, they could benchmark internally. “Relative to our sister functions, we are more or less cost effective.”