Hacks to Help You Reduce Outside Counsel Spend

Managing outside counsel spend is one of the biggest challenges facing in-house legal teams. Too often, we find ourselves with eye-watering legal bills that could have been avoided with better planning and smarter resource allocation. After years of building and running legal functions, I've learned that reducing outside counsel spend doesn't mean compromising on quality - it means being strategic about when and how you use external legal resources.

Here are eleven practical hacks that will help you take control of your outside counsel budget while still getting the legal support you need.

1. Use Alternatives

Process-heavy, repetitive tasks should be outsourced to an Alternative Legal Service Provider (ALSP) or replaced with AI and automation. Both options reduce overhead costs fast.

Traditional law firms charge premium rates for work that doesn't require their deep legal expertise. Document review, contract redlining, compliance monitoring, and legal research can often be handled more cost-effectively by ALSPs or automated tools. Save your outside counsel budget for the complex, strategic work that truly requires their specialised knowledge.

2. "In-Source" Low-Value Work

Take a long hard look at the work outside counsel is actually doing. You've probably got them handling low-value work at a high price point - bring that back in-house. Save your budget for the work you really need their talent and deep expertise for.

Many in-house teams automatically send work to outside counsel without considering whether it could be handled internally. Simple contract reviews, routine employment matters, and standard compliance issues can often be managed by your internal team with the right templates and processes in place.

3. Small Is Beautiful

BigLaw doesn't always equal big results. A small or mid-sized firm may be a better fit for your needs and budget.

Large firms come with large overheads, which get passed on to clients. Smaller firms often provide more personalised service, faster turnaround times, and significantly lower rates. They're also more likely to be flexible on fee arrangements and willing to work within your budget constraints.

4. Limit Access and Communications

The fewer people on your team that have access to outside counsel, the better. Too many cooks can lead to overlaps, confusion, out-of-scope work, and conflicting instructions.

This works both ways: limit the number of fee earners contacting your team too. Designate specific points of contact on both sides to ensure clear communication and prevent unnecessary duplication of effort. Every additional person in the communication chain adds cost and complexity.

5. Close Fast

Letting matters drag on can lead to doubling up on work, outside counsel needing to read back in to see where they left off, new fee earners losing context of your matter, and scope evolution that drives up costs.

Set clear deadlines and stick to them. Long, drawn-out matters become exponentially more expensive as lawyers need to refresh their understanding of the issues, catch up new team members, and navigate scope changes that inevitably occur over time.

6. Be Clear on Scope

Scope creep is a huge offender when it comes to budget overruns. Both you and outside counsel need to be proactive in setting expectations from the start and managing spend as you go. Be clear on fee estimates and ask for regular updates to nip any confusion in the bud.

Define the project boundaries clearly in writing. What's included, what's not, and what happens if additional work becomes necessary. Regular check-ins help ensure everyone stays aligned and prevents nasty surprises when the final bill arrives.

7. Use Billing Guidelines

Define what you will and will NOT pay for to set expectations and create an agreed framework for tracking spend. Billing guidelines also reduce errors and will get you in your finance team's good books.

Clear billing guidelines eliminate ambiguity about what constitutes billable time. Specify your requirements for time entry descriptions, approval processes for expenses, and any activities you won't pay for (like administrative tasks or excessive partner oversight).

8. Actually Discuss Fees

Forgetting to chat about fees happens a lot - sometimes understandably, and sometimes because money can be an awkward topic. But hoping outside counsel will keep fees low and work within your guidelines is a terrible strategy, so make sure you're proactive about this from the get-go.

Find a way to take the emotion out of talking about money. Treat fee discussions as a normal part of project planning. Discuss budget constraints upfront, explore alternative fee arrangements, and establish clear parameters for when additional approval is needed.

9. ALSPs for the Win

I cannot speak highly enough about Alternative Legal Service Providers. They rescued me from burnout.

Use them for repetitive redlining, process-heavy work, and projects like legal tech selection and implementation. Save your outside counsel budget for when you need it most - work that requires deep legal expertise, complex transactions or litigation, and moral support during challenging matters.

ALSPs combine legal expertise with operational efficiency, often delivering better results at a fraction of the cost of traditional law firms for routine work.

10. Legal Ops for the Win

Many General Counsels haven't operationalised their legal function and don't run it like a business. You need to get to grips with finances as soon as possible. Learn the lingo.

Audit what is and isn't working in your processes and identify areas where you needlessly spend too much money. Also identify areas that work well and justify continued investment. Legal operations principles help you make data-driven decisions about resource allocation rather than relying on gut instinct or tradition.

Taking Control of Your Legal Spend

Reducing outside counsel spend requires a strategic approach that balances cost control with quality legal support. The key is being intentional about when and how you use external resources rather than defaulting to outside counsel for every legal need.

Start by auditing your current spend patterns. Where is your money going? What work could be handled differently? Which relationships are delivering value and which are simply expensive habits?

Implement these hacks gradually, starting with the ones that will have the biggest immediate impact on your budget. Track your results and adjust your approach based on what works best for your organisation.

Remember, the goal isn't to eliminate outside counsel entirely - it's to use them strategically for the work that truly requires their expertise while finding more cost-effective solutions for everything else.

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