Hi there,
Yes, PERSUIT is incredibly passionate about helping the legal industry move away from hourly rates.
(Although we “killed” our “Kill Bill-able Hours” Newsletter last August, I may have been known to still don yellow and black socks and t-shirt on occasion🤺.)
We also know that regardless of where your team may be on its journey towards value-based pricing and other types of AFAs, hourly rates still, and will likely always, play an important role.
There are certain types of work where traditional hourly rates are simply best suited.
And even when they aren’t, negotiating hourly rates is an important starting point for negotiating more effectively with your relationship firms.
As Cintia LeLann, Sanofi’s Global Head of Legal Purchasing recently explained in our latest webinar on rate negotiations, hourly rates are an important starting point to understand firms’ overall competitiveness.
Hourly rates are also factored in when negotiating AFAs on specific matters, in addition to volume discounts and value adds.
Still, rate negotiations are painful.
😖 Setting up spreadsheets, building rate card comparison frameworks for all firms, and manually setting up calculations like “weighted average change %” and “spend impact.”
😥 Validating that data with appropriate internal and external benchmarks.
😣 Capturing and tracking the negotiation communications and relationship history scattered amongst various relationship stakeholders.
🤪 Ensuring all internal stakeholders — procurement, legal ops, legal leadership, and the lawyers who themselves are most directly managing those firm relationships — are all on the same page and coming to the negotiating table with a unified voice.
🤕 And then multiplying those efforts across the average 97 firms that GC teams with $10 million or more in external legal spend have relationships with.
Most in-house teams simply don’t have the resources to navigate mountains of pricing data and come to the bargaining table with their maximum leverage.
But what if you could...
✔️ Shorten the negotiation process from 6 months to a matter of weeks?
✔️ Come to the bargaining table with actionable insights on firm pricing — year-over-year, across firms and timekeepers?
✔️ Have the bandwidth to negotiate with 10%, 15%, or 25% more of your firms rather than being forced to blindly accept rate hikes because you don’t have the time or resources?
Next week, PERSUIT launches a new product — Rate Review Pro.
Rate Review Pro centralizes the end-to-end rate negotiation process by easily comparing hundreds of firms and rate cards side-by-side.
Rate Review Pro stores all rates in one place and calculates the metrics that matter so legal teams can negotiate with precision.
Stay tuned for all the details next week.
Cheers,
Jim
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