• Do you have a preferred law firm list already in place? If so, what types of value-based fee
structures terms have your outside counsel shown familiarity with?
• Look over your outside counsel performance reviews to see who has the strongest success
and track record on value-based fee structures. If you don’t track written reviews, talk to
your colleagues to gather this feedback.
• How much competition will you interject into the process to assess which firms would
deliver the best value on a particular matter? This can range from informally speaking with a
couple of trusted firms, to issuing an RFP and soliciting terms from multiple firms (including
some “brand new” firms) to identify the best mix of quality, staffed talent, and cost.
• Some law firms may object to higher levels of competition, but there is a very reasonable
conversation to be had about: (1) the economic and commercial realities facing your
company, which have likely increased competitive pressures internally and externally across
the board, and (2) the opportunity for additional business for those law firms that continually
deliver the best value. t is also helpful to note the emphasis on long-term value (i.e. quality,
cost and outcomes) – not to be confused with just the lowest price. Executed correctly,
value-based billing is a management approach focused on success in the long term, with
deeply rooted incentives built on trust and mutual understanding.
• Must ask – how reliable or believable is this proposal? Think about this firm’s ability to meet
budget historically. If warranted, adjust the figure to an expected value that properly reflects
the real likelihood of achieving it.
• Must determine whether the budget will be viewed as an estimate or a quote.
To what extent will you hold outside counsel accountable? Does the plan include pre-agreed
contingency or “safety valves” for unlikely but possible deviations based on how the matter
unfolds? This can be one of the biggest determinants of value and savings.
• In the end, trust is a key component in making these arrangements work. Do client and firm
believe that each will honor its commitments, behave fairly and be able to work together in
good faith to address unanticipated issues?