Legal news and trends for Canadian in-house counsel and c-suite executives
Issue link: https://digital.canadianlawyermag.com/i/50877
law department is involved in and set- ting out estimates and targets for each phase. Basically to make sure the final bill is never a surprise. Still, not all of RBC's plans are being met with open arms. Often when the idea of value billing or demanding law firms work in a different way comes up, smaller groups say it's easier for places like the Royal Bank due to its size. Aust says even with the power of Canada's largest corporation behind them, the value discussion isn't a simple one. "I think you would be surprised," he says. "[Law firms] are always going to listen to us, but [it's] whether they co- operate actively or aggressively resist. I think we see a lot of passive resistance. idea that it would reduce inefficiencies. As one of Seyfarth's clients, Motorola helped the law firm understand the protocol and in turn the firm adapted its own process called "Lean Six Sigma." Basically the project management sys- tem helps deliver the very thing the ACC Value Challenge and businesses like RBC and FMC promote. "The way we can deliver the biggest return to our clients is to collaborate with them on a process," Damon says. "Looking at how we deliver work, how they use us to make sure along the line we have the greatest efficiency and then we can lower costs to them while we are continuing to deliver high value." But before Seyfarth could even begin I can say even for our size, which gives us some leverage, I would say this is not an easy thing to do, it's a big ship we are trying to turn around. MURRAY AUST, Royal Bank of Canada ney means more and more clients are looking to the "Lean" business model approach. However, because of Sager's assertion and her belief the approach has to be total firm buy-in, Damon isn't worried about too much competition. "I'll be surprised if any other firms are able to do it without the kind of top- down unrelenting commitment that Tom [Sager] talked about." Still, law firms would be wise to look at the value-billing model, if for no other reason than it's what their clients want. "A lot of in-house counsel are embracing the Value Challenge and recognizing that it is not simply a ques- tion of saying I want a discount," says Andrew Fleming, a partner with Ogilvy Renault LLP, a Canadian firm that has won the ACC's president's award for work with the association for three years running. Fleming will be one of the first people to question the billable hour and the use of discounts, because as he says, the lowest price may win you a client for a day, but a value-based system of col- laborative approach to legal services will get their business for the long haul. Like Carr, Fleming believes the Value "What I would take from that is this is going to be a tough road and it is going to be tougher for a company that doesn't have our size on their side. Because I can say even for our size, which gives us some leverage, I would say this is not an easy thing to do, it's a big ship we are trying to turn around." One such firm that is having the dis- cussion with its clients is Seyfarth Shaw LLP, a full-service U.S. firm with more than 750 lawyers. Lisa Damon, the firm's former managing partner who is now its national chairwoman for labour and employment law, says it too began work- ing on a different billing structure — in earnest — five years ago. Motorola, Inc. had begun a process called "Six Sigma" as a way of improving the manufacturing process and avoiding defects. However, the process has been adapted for other uses, with the basic on its journey it was given some words from the wise. Tom Sager, senior vice president and general counsel of DuPont, told the firm don't bother unless it is done from a top-down approach. Sager is known as a value-billing pioneer through DuPont's convergence and law firm partnering program. Even with the top-down approach the road has not been an easy one, says Damon. Changing the entire nature in which legal services are provided and billed takes a long time and is still a long way off. "This is a journey for us, I don't want anyone to think that all of our lawyers and all of our clients are all lined up in unison, we are not, we are on a journey." In fact, Seyfarth spent a great deal of time in the beginning of developing its project management systems by "prac- tising" on itself. Now the Seyfarth jour- 26 • DECEMBER 2009/JANUARY 2010 INHOUSE Challenge is all about in-house and outside counsel working together and understanding each other's business. "The ability of in-house counsel, and perhaps those in leadership roles in law firms who are being pressured on value challenge, is to create a palatable story for the partnership and sell it, it's a sales job . . . not a snow job." Despite the Value Challenge being ahead of its early goals, Carr is incredu- lous when he talks about legal depart- ments not embracing value billing. "Frankly we've been quite amazed that others have not been as aggressive and robust in sitting down with their out- side counsel, having a conversation, and moving forward along those lines. But we are really glad to see the ACC has embraced this issue and going great guns on it. We think it's the right way to go, we've been doing it for years and we think it's the right thing for the profes- sion." IH