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An article in the Acad. Mgt. J., April 2012 at 399, concerns a problem well recognized among human resources professionals: “the transition from expatriation to repatriation routinely culminates with repatriates quitting organizations.” If you post a lawyer to an overseas location, when they return they often leave the company. The article cites a large-scale study of 120 multinational organizations. Repatriated employees voluntarily quit within the first year of returning to their home country at a rate three times that of the turnover rate of all employees.

Not that expat assignments are all that common in law departments, but when there is an international posting, it would be a loss to have the lawyer return and shortly thereafter resign. The article concludes that the during the time overseas, the employees change so much that they no longer fit well when they return. General counsel should try to preserve their investment in lawyer who are probably high potentials since they were sent overseas for training and exposure.

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On a pace to exceed 1,000 legal departments, the first release this year of GC Metrics survey of 2011 staffing and spending goes this week to the 332 departments that have submitted their data. The lengthy report focuses on 25 fundamental management metrics, such as lawyers per billion of revenue, for 23 industries. It also provides medians by revenue of company and size of law department and country.

New this year also are optional questions about compensation and contract management software. Participants in the no-cost survey will learn findings about those later this year.

You can get the first release promptly whenever you take the survey. Go to the confidential survey site and provide your identifying information and the six pieces of data asked for. All data is normalized and only medians and quartiles are published in the report.

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When meteorologists predict the weather for a month, they often use one of the so-called naïve forecasts. What the average spend during June for the last five years – the counterpart of the climate of the region and the basis for the naïve forecast – stands as a first-cut forecast.

A second type of naïve forecast is persistence, which would predict spending based on the average of the preceding months. All else being equal, it assumes the pattern will continue. A model developed to predict something needs to perform better than both of the naïve forecasts.

A third method, which is not described in David Orrell, Apollo’s Arrow: the Science of Prediction and the Future of Everything (Harper 2007) at 150, looks at the trend line of preceding months. The (persistence) average smoothes out and hides change; a trend line suggests the direction of change and therefore gives more information.

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Dr. Silvia Hodges combines teaching at Fordham Law School with her work at CT TyMetrix. As an academic, she has researched and spoken about procurement practices related to law departments. In a recent e-mail to me she explained her efforts to bring together procurement professionals who want to understand better external spending on law firms. “We gathered the procurement people on May 2 at the Harvard Club [in New York City]. The group was composed of almost 20 procurement professionals of the largest US and international companies. Other meetings will follow in the next few months. They are definitely here to stay!”

If you or someone you know is interested in taking part, write Silvia directly for more information (See my post of March 1, 2008: procurement with 17 references; and Aug. 6, 2010: procurement with 7 references.).

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The In-House Community comprises over 18,000 in-house lawyers and those with a
responsibility for legal and compliance issues within organizations along the “New Silk Road.” The New Silk Road is their clever term for a broad swath of the world from Asia through the Middle East. The activities of the Community include the annual In-House Congress circuit of events, Asian-MENA Counsel magazine and Weekly Briefing, and the In-House Community online forum.

One notable feature of Asian-MENA Counsel is the plethora of recruiters who focus on the in-house market. The placement scene must be frothing and bubbling over there! In the latest issue I noted full-page advertisements for seven of them: ALS Recruit, cml, Hughes-Castell, Legal Labs Recruitment, Lewis Sanders, Pure, and Taylor Root.

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Roughly summarized from the research presented in MMS Insights, four MMS packages stand out as having averaged more years in use, more lawyers in their departments, and more external spend under management. A second group of four packages were, generally speaking, less in longevity, less in average numbers of lawyers, and less paid to external counsel. Seven packages occupied another tier below that.

Not surprisingly, therefore, the law department market has segmented in terms of matter management software. We might think of them as industrial grade packages for heavy spenders, main stream packages for the middle-of-the-road spenders, and lite products for the relatively low spenders. Vendors of this specialized software logically tend to target one of those segments more than the other two.

If your IT group or your law department would like to purchase the report, please write its analyst and author, Rees Morrison, at Rees@reesmorrison.com.

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The supplement to the ACC Docket, May 2012 at 8, charts the career of Brigitte Catellier, Vice President, Legal Affairs and Secretary of Astral Media Inc. Early in her career, while at a large Canadian firm, she was asked by one of her clients, Culinar, to take on the tasks of its corporate secretary. Unusually, she remained with the law firm, but spent about a third of her time working in-house at the company. The article does not add how long the unusual secondment lasted.

This put blog has several references to law firm lawyers who simultaneously hold a position in a law Department, but this is the first instance I have run across where the lawyer is also serving as a company secretary. Since my last metapost on secondment, I have gotten a second wind, so to speak (See my post of Aug. 25, 2009 #2: four-month secondment to Legal Aid Society; Sept. 13, 2009: ten good questions for a secondment; Oct. 13, 2009: if law departments demand large numbers of secondees; Jan. 20, 2010: reverse secondments as a training method for legal departments; March 24, 2010: secondments will rise if more firms decide they are a prerequisite to partnership; Feb. 22, 2010: loyalty scheme of British firm can result in secondees; June 14, 2010: doubt that departments retain firms because of secondment prospects; April 21, 2011: current Motorola Solutions GC was once a secondee to it ; and May 3, 2012: as-need lawyers as alternative to secondments.).

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An excellent article in the ACC Docket, May 2012 at 32, describes the Litigation Investment Model of Reckitt Benckiser. Essentially, the model puts law firms at risk for their profit margin when they represent that company. And, those profits are lucrative.

For the 200 largest law firms in the United States, ALM Media found that their profit margin last year was about 38 percent. (I assume that one-third margin makes up the distributions to partners at year end, over and above their draws.) Law firms make much more than their clients as a percentage of revenue. “In the last reported quarter, the average operating profit, net of tax, for a typical US manufacturing company was 7.2 percent, and among technical and professional services, it was a paltry 6.8 percent.” Thus the heavy-weight firms in the United States are gold-plated; their profit returns are on the order of five times greater than the clients they represent. Hmmmmm……

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As my General Counsel Metrics benchmark survey now collects compensation data, I pay more attention to findings from that realm. For example, “In Brazil, lawyers can expect to receive an average basic salary of $279,600 – 21 percent higher than the average of $231,500 in the United States.” That comes from the ACC Docket, May 2012 at 18, which draws on a compensation study done by a recruiter. I have previously reported on data for U.S. general counsel, who from my data had median base salary plus bonus of $279,457 (See my post of May 23, 2012: from General Counsel Metrics benchmark survey.). The reported Brazilian and U.S. figures seem quite high, especially if “average basic salary” does not include bonus amounts.

I digress. Here is the point of this post. “In Dubai, the average salary has reached $181,800.” That is strikingly lower than the other two national figures but as is disclosed thereafter, Dubai residents don’t pay income tax. If you were to add roughly one-third to the basic salary figure for taxes, the comparison with Brazil and the United States becomes much closer. A benchmark study, let alone a compensation study, that uses Dubain figures unadjusted would seriously misrepresent comparisons.

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In-house counsel app. Thomson Reuters has released what it believes is the first iPad app delivering corporate counsel specific information. Called GC Advisor, the app offers information, technology and legal research tips, as well as articles and CLE classes. There is also an RSS feed to CLE-accredited webcasts from the West LegalEdcenter and to Twitter feeds. The app is available from iTunes, according to Charles Christian’s American Legal Technology Insider, May 2012 at 5 (See my post of Feb. 1, 2011: app industry for matter management functions; and April 15, 2011: information delivered in-house by mobile apps.).

How many in-house lawyers practice full-time in New York State. Under a rule promulgated in 2011, Part 522, “All in-house counsel employed full-time in New York as of Part 522’s effective date, April 20, 2011, were required to apply for registration within 90 days of the effective date.” This update comes from NYSBA Inside, Spring/Summer 2012 at 16, which is devoted mostly to the attorney-client privilege. Here is a way, perhaps, to find out how many in-house lawyers are in one of our largest states, and perhaps even how many law departments! To learn more about the New York requirement, write one of the co-authors, Vincent Syracuse (See my post of May 23, 2012: in-house attorneys in the United States.).

Extravagant number of lawsuits in Brazil would skew metrics. It seems innocuous to ask on a survey for “your number of pending lawsuits.” Then I read in Alternatives, the newsletter of the International Institute for Conflict Prevention & Resolution, May, 2012 at 120, about Brazil, “with 70 million court cases now pending.” A Brazilian litigator observed that “It’s very cheap to litigate in Brazil” and that cases routinely drag on for 10-15 years. It would totally distort a world-wide count of cases, such as for a benchmark study, if a company doing business in Brazil has more there than everywhere else combined.

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