Posted by: johnocunningham | March 18, 2017

Peering Into the Future: Microsoft’s New Outside Counsel Hiring Processes

A story that appeared last month in Bloomberg Law – about a coming overhaul in the way Microsoft hires law firms – may well be harbinger of things to come for outside law firms of other large clients.

Based on interviews I have done with GCs over the years, I see the following story highlights as likely trends that will gain momentum in the coming years:

  • A continuing move toward hiring specific lawyers with specific expertise rather than hiring firms for one-stop shopping
  • A move toward greater emphasis on building relationships between in-house counsel and minority associates at law firms, which will likely result in more minority partners eventually
  • A shift toward greater use of data and management dashboards by in-house lawyers, who will be able to examine historical data on the performance of individual lawyers in various engagements over the years, their rates, their previous engagements, and the history of who has hired them

The story also notes that Microsoft will be requiring in-house legal managers to hit certain targets for alternative billing. Data from other sources suggest that the alternative billing trend may have slowed in recent years, but that could just be a temporary pause until more creative ways of working with fixed fee arrangements and performance contingencies can be developed.

An Assistant GC at Microsoft said that the company is pushing its outside firms to make better use of data, technology and automation to deliver more value. Law firms that become quick adopters of technology, data analysis, and process improvement disciplines could benefit in the years to come.

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