We don’t need a crystal ball to see that the future of effective corporate counsel decision making will be based upon greater use of metrics. Holding budgets tight requires strong data analytics to assess cost-effective strategies and to negotiate value-based arrangements with outside counsel. We chatted with Tom Melling, co-founder and president of Serengeti, to get his perspective on the importance of metrics to in-house counsel in the wake of his business’s release of Serengeti Intelligence.
Editor: Everyone is budget conscious, and certainly you have been hearing that from corporate counsel for some time. Why is Serengeti launching this measurement tool now?
Melling: You’re right, corporate counsel have always worked short-staffed and on a tight budget, and negotiated for strong business partnerships with firms. However, that negotiation process has often been based on surveys conducted the previous year – and with last year’s prices – and also based on a larger geography or more generalized pool of information. Now, that discussion, the negotiation process, can be more meaningful because it can be based on specific, real-time information.
Editor: What is Serengeti Intelligence, and what does it offer counsel that they didn’t have before?
Melling: This is the only real-time tool that provides comparative information for legal departments and firms to evaluate their performance against industry benchmarks and peers. Serengeti Intelligence is the legal industry’s largest source of aggregated and normalized legal project data, derived from billions of dollars of legal bills, budgets and results generated by more than 420 corporate law departments and 21,000 law firm offices globally.
Editor: What were some of the surprises or “aha!” moments that you encountered when developing Serengeti Intelligence, and how did they help you focus on how it should function?
Melling: When you’re working with a data pool this enormous, there are going to be lots of surprises. One insight that led to a substantial product enhancement came while working closely with the law department of one of the world’s largest financial services companies. We saw that the impact of rate increases was generally greater than what the law firms were telling them. With their help, we automated a process Amex used that runs proposed rate increases through the prior year’s bills for a much more realistic view of the likely impacts. Marrying this much more practical assessment of rate increases together with the billions of dollars of rate information from comparable firms in Serengeti means that there will be a much more realistic, data-driven discussion regarding the reasonableness of proposed rate changes.
Editor: You work closely with corporate counsel. How is this real-time information relevant to their partner firms?
Melling: Firms can instantly analyze their relationships with each client and manage to the same metrics the inside counsel/client is using to evaluate the firm, as well as measure what competitors are doing in the marketplace. The data is useful in trending for financials, invoicing and timekeeping; finding areas for growth potential; and analyzing current market rate trends over time. We feel this will strengthen the counsel/firm partnerships and lead to greater collaboration because everything is more transparent. Audit alerts are an additional feature that identifies discrepancies within invoices, allowing the problems to be corrected prior to sending the bill. We expect that dealing with these issues before the bill goes to the client will reduce the time currently spent by both in-house and outside counsel on disputed invoices.
Editor: The American Corporate Counsel annual meeting was held last month. What were some takeaways you heard from the meeting or from clients since the ACC met?
Melling: As you might expect, at the annual meeting the big talk was budgets and how to manage them better. Regulatory changes were significant again this year. Another ongoing theme we’ve been hearing from inside counsel as we approach the end of the year is their renewed interest in assessing how law departments and outside counsel are providing measurable value to corporate clients. We hear it is becoming more common for law departments to be asked for similar performance data as those required of other company departments – metrics regarding productivity, savings, and results. As a result, in-house counsel are demanding better ways to collect and to report on the data that will help them to increase the value they and their outside counsel provide to their companies.
Tom Melling is Serengeti Law’s President. As one of Serengeti’s original founders, he was previously responsible for the design of Serengeti Tracker as well as the Client Relations Group – the team that implements and supports the system. Prior to founding Serengeti Law, he practiced law at Perkins Coie in Seattle, Washington where his practice emphasized Internet and e-commerce law, specializing in electronic contracting, public key infrastructures, encryption and data protection.
Serengeti Law, a Thomson Reuters business and provider of Serengeti Tracker and Serengeti Intelligence, is the legal profession’s widely used and highly rated e-billing and matter management platform.