When General Counsel Michael Tucker took the helm of the legal department at Avis Budget Group in 2010, he found “chaos”: a company using almost 700 law firms globally, often hired by local managers at the mobility company that includes such brands as Avis, Budget, Payless and ZipCar.

“It was almost impossible to get my arms around the legal budget,” says Tucker, who heads up a department of about 30 attorneys. Further, there was little appetite within the business to spend the time and money to get things under control. But in

2014, everything changed: The company adopted a zero-based budget policy that required a justification for everything in a department’s budget. A closer examination of spend revealed many inefficiencies, not the least of which was that ABG was paying

71 percent of its outside litigation spend for partner time. “We also discovered that we were outsourcing a lot of legal work, not because we were lacking the skill set but because we were lacking the bandwidth,” says Tucker, who subsequently hired six new attorneys to allow for the strategic insourcing of certain legal work.

The foundation was laid for an innovative law firm convergence program, coupled with strategic insourcing and new legal operations capabilities, that collectively transformed the department and has changed the way ABG lawyers view themselves and their clients think about the legal team, Tucker says.

A disaggregation exercise separated
legal work into three tiers according to its
complexity and level of exposure:
• Cream: high legal and financial exposure,
with relatively low volume and frequency
• Core: medium to high legal and financial
exposure, with significant volume and
regular frequency
• Commodity: low to medium legal and
financial exposure with high volume and
frequency.
In 2015, ABG began its yearlong legal
transformation effort using a multistep
process:

1. A pre-RFP package went to over 130 firms, asking law school-type scenario questions: how the firm would solve and staff a matter, use technology and apply innovative strategies. “We were focused on the firm’s use of technology, a culture that supports innovation and a client satisfaction orientation,” Tucker says.