Hi there,
Attorneys are great at “why we shouldn’ts.”
After all, we’re trained to see — and mitigate — the risk around every corner. 🫣
When we first introduced PERSUIT to the legal marketplace, one of the top “why we shouldn’ts” we heard (and still hear) from in-house teams was:
"Using alternative fee arrangements and competitive sourcing will ruin our firm relationships, if our firms will participate at all."
But as our 2024 PERSUIT Firm Rankings Report shows, that’s just not true.
Over $10 billion in RFP value has been submitted on PERSUIT.
Including 100% of the Am Law 100 law firms participating.
And in 2023, nearly two-thirds of those matters utilized AFAs.
Clearly, AFAs are not ruining corporate legal departments’ firm relationships.
In fact, when we invited some of the top firms in our 2024 rankings who are using innovative pricing to share their perspective in a recent webinar, we heard just the opposite.
Everyone's being asked to do more with less these days — both clients and law firms included. And AI is only hastening that demand.
The demand for better value at a lower price affects all of us.
So the question isn't how do we stop that.
The question is, how do we embrace that; how do we deliver?
And AFAs are a big part of that.
As legal teams are building better muscles around scoping and communicating on AFAs (and certain platforms are helping them in that “PERSUIT” 🤔), AFAs are proving less administratively burdensome, and dare I say profitable!
Here’s what else firms told us.
The truth is, the hourly rate doesn’t always work for law firms either.
Because the real risk for firms, regardless of the fee arrangement type, is that overruns occur and clients are left disappointed that they didn’t get the outcome and value they expected of the bargain.
As Ron Chapman (Shareholder, Ogletree Deakins) shared:
"I think it's risky to not do an AFA or at least explore it because your relationship with the client depends on it. The outcome of it depends on it. You want a good result for the client. The law firm wants a good result for themselves as well, because it means that the client is more likely to come back to them."
That’s exactly why we designed The PERSUIT 50 Firm Rankings Report based on the real-world buying behaviour of the world’s largest corporate legal teams.
Not subjective surveys, interviews, or “peer” reviews.
The way we see it, the more often you buy something, the more you trust it.
So which firms did your peers trust most often in 2024?
You can find the rankings here.
Cheers,
Jim
