Report: 46 cents of every legal dollar goes to outside counsel as legal ops increase in stature
The latest survey by the Corporate Legal Operations Consortium (CLOC) is out. And while it somewhat predictably shows the growing importance of legal operations pros in large legal departments, the survey also contains some interesting statistics about how legal departments do their work.
We thought it interesting that outside counsel costs, which are universally criticized as astronomical and getting worse, don’t consume most of corporate legal spend. In fact, they come under half—46 percent. What’s the median external expenditure? The survey says $11.7 million. If you break that spend down by individual in-house attorney, it comes to $451,000. Insurance companies have the highest total legal spend—little surprise there, given the number of legal matters they handle.
And what about legal ops? According to the survey, the discipline and its practitioners are now an integral part of the legal department—or, we should say, a part of the larger departments. They have an average of six operations pros. Again not surprisingly, insurance companies have the largest number of legal ops employees, while large corporate departments have on average 14 operations professionals.
Are those professionals all lawyers? No. While many are, and hold such titles as deputy general counsel, most have more operations-oriented titles, such as legal operations manager. That makes sense, as while they must fully understand the legal work done in the department, their expertise lies in procuring vendors (law firms and legal services) and controlling costs.
You can find the entire survey here.