Canadian Lawyer InHouse

DURAND: I have found depending on the reason you want to add an additional resource, you may or may not have a direct correlation. So if you outsource a lot of contract work and then bring someone in, then, yes, my boss and finance team would look for a direct correlation. If you do it because of growth or a new area that you need to look into or you have new issues to deal with then I think that is a different discussion about why you need the resource and the value that it's going to add. INHOUSE: Do you find the external firms are working with you more to help control costs or do you still have to push the conversation? MEHES: I think there are a lot of different ways to look at costs. We all talk about trying to reduce cost and to manage cost. There are a lot of different factors that go into doing that, and I think it's very different for complex "bet the company" litigation than it is for commodities kind of day-to-day business or transactions. I still view it as gearing the conversation more towards not just controlling cost but delivering value. DURAND: The law firms I am working with are open to the dialogue. I am not sure we have advanced too far on it, and I think there is work to be done on both sides in my case. Some of it I think is compartmentalizing the work a little bit better to say, "Here is what I am looking at from a value proposition and here are the things that might be viewed in a more traditional sense because they are unpredictable event-type matters." I think I would say one of the things I need to do is be more transparent about how it works for me. That's to say, "Here, this is the budget I get and this is what I am accountable for and this is what I am trying to manage." I think that would be helpful for my law firm partners to have a better understanding of that rather than the sort of blanket statement like, "You need to figure out a way to reduce the legal expense." AHMAD: That is a great point. We have had discussions with our external counsel a while back on these types of topics, and I paused and said, "We should be having this discussion not now but back in the fall. Let's get involved on that point, and I will set out what the issues are for me." One thing I think the firms and external counsel do now recognize is that at the least you need certainty. You need to, as much as you can, communicate with the business and be able to deliver. ALLGOOD: I agree it's a value question. I would like to see more leadership from the law firms, but I think general counsel are taking on the leadership of the conversation. More are going to the firms and wanting to have the dialogue, and I think the firms are coming to the table and having the discussion around value. The value challenge the ACC launched was quite successful and continues to have traction in Canada. One of the most important things I see is the in-house lawyers sitting down with the firm to do the budgeting. I think we were quite guilty of just throwing files at the firms and then they came back and we said "that's not what we wanted" but we didn't tell them. I think the firms are listening more. My only disappointment is I would like to see more coming from them, but I think general counsel are leading in this area. LEWIS: We have a very open approach with external counsel and we tell them we are looking to manage better. But we also get a lot of value added things like internal education. They do it willingly and well. I think our wish to spend more wisely and more carefully is part of the same impetus that they have to make the most of the hours they work and to do well because the work has decreased for large firms. So we both are going in the same direction with opposite goals in mind, perhaps. JOHNSON: I wouldn't even know how to judge a fixed fee but we keep an eye on the legal fee and if they are too high then I let them know that. We also, when possible, try to use smaller law firms. There is skill and expertise and they are more economical and you don't need the massive teams because our deals are not that large. INHOUSE: Are regulatory and compliance issues putting more pressure on your department? MEHES: Pharma is such a heavily regulated industry and the regulations are changing all the time. I have a regulatory affairs function reporting to me as well as the legal function, so it makes for all kinds of interesting regulatory and compliance issues. I don't see it as pressure as much as I see it as a challenge and an w w w. c a n a d i a n law y er m a g . c o m / i n h o u s e august 2013 • 23

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