10 Battle-tested Tips To Tame Legal Spend

Summary

Legal spend continues to rise, but industry experts have identified proven strategies to maintain control without compromising quality. This article presents actionable tactics from seasoned legal operations professionals at GEICO and OGE Energy Corp., based on real-world experience managing multi-million-dollar budgets.

Key Highlights

• Data-driven cost management - Use audits, benchmarking, and robust analytics to make informed decisions and justify spending to stakeholders
• Strategic provider relationships - Diversify legal service providers, implement blended rate structures, and negotiate multi-year engagement cycles for predictable costs
• Optimized resource allocation - Leverage technology, restructure work distribution, and implement vendor management programs to maximize value from legal spend

Legal costs keep climbing, but savvy legal operations professionals are fighting back with proven tactics that deliver real results. In a recent Buying Legal Council session, industry veterans Jessica Williams, Director, Legal Operations, Strategy and Data with GEICO, and Amanda Reyes, Supervisor of Law Department Operations with OGE Energy Corp., shared their most effective strategies for controlling outside counsel fees without sacrificing quality. They spoke with Kris Satkunas, Director of Strategic Consulting with LexisNexis® CounselLink®.

Drawing from the latest LexisNexis CounselLink 2025 Trends Report: Benchmark Metrics to Empower Legal Cost Metrics and real-world experience managing multi-million-dollar legal budgets, these experts revealed their specific approaches that have helped their organizations stay ahead of rising costs. Whether you're dealing with rate increases, scope creep, or budget pressure from leadership, these nine actionable tips will give you the tools to regain control of your legal spend.

Ready to put these strategies to work? Watch the full session recording [here] for additional insights and Q&A from the panel.

10 Tips to Tame Legal Spend

1. Conduct an Audit with Data. Every legal department needs to know where it sits on its maturity journey. A department that uses zero data in decision making is on the low end of the maturity spectrum; whereas a law department that selects and uses data to drive decisions based on analysis is highly mature and successful, adding value to the enterprise. Drilling more deeply, data audits and analysis can be conducted in various parts of the legal department. Ensure that benchmarking data is used to conduct annual analysis. This provides a baseline for the audit process and is an indicator of areas for improvement.
2. Plan for Incremental Increases. Anticipate that outside counsel fees will likely rise during the engagement. Set your budgets to allow for scheduled bumps, whether moderate or marked, to avoid last-minute surprises.
3. Diversify Legal Service Providers. Consider shifting some work from larger, costlier firms to smaller, regional ones. This method can help maintain quality while controlling overall spending. Most, if not all, corporate counsel know that the mid-tier law firms are hungry to prove their worth. Find a test project and give a new firm a try.
4. Structure Engagement Cycles. Implement longer-term cycles for reviewing rates with external counsel. By setting a multi-year review period, you can mitigate the frequency of rate hikes and negotiate more predictably.
5. Optimize Work Allocation. Rethink the distribution of tasks among legal teams. Use cost-effective staff like associates and paralegals for routine assignments while reserving partner input for specialized issues. One particular finding, however, in the CounselLink 2025 Trends Report, indicated that some associate hourly rates are being billed at $1,900 per hour. It’s important to inquire up front about the billing rates for the legal team representing the company.
6. Rely on Robust Data. Leverage both internal spending records and external benchmarks. Good data helps justify decisions and demonstrates effective cost management to stakeholders.
7. Clarify Expectations with Blended Rates. Adopt a standard of blended fees for most matters, reserving premium hourly rates only for niche expertise. This approach sets clear expectations with law firms and aligns costs with the value received.
8. Request Broader Value Offerings. Push for additional benefits beyond legal advice. Inquire about related services like training sessions, continuing legal education, or other complementary resources that can add value during periods of fee increases.
9. Consider a Bonus Structure. For outside counsel that deliver services over and above, and perhaps have a winning litigation record, too, consider adding incentives to the relationship. You can be the judge of what constitutes an incentive, but the goal is to build and strengthen a vendor relationship for the long term. Using data to determine a bonus structure makes sense.
10. Implement a Vendor Management Program. Enterprise legal management software includes a vendor management feature. Legal operations professionals can implement a vendor program to track and analyze fees and hourly rates; determine the status of budgets; review the timekeeper mix for each matter; look at the diversity of the legal team to ensure it matches the matter needs; and improve invoicing accuracy, among other opportunities. Each suggestion is designed to help legal operations teams manage rising fees while maintaining service quality through strategic planning, thoughtful partnerships, and data-driven decision-making.

Consider LexisNexis CounselLink

As a leading enterprise legal management solution, LexisNexis CounselLink provides e-billing, matter management, vendor management, contract lifecycle management, and analytical workflow management integrated into a single dashboard. Legal operations and general counsel can work with the finance department to create and manage legal spend budgets that align with the enterprise. Set up a demo of CounselLink here.

TL;DR:

The article outlines 10 effective strategies for managing rising legal costs, including data audits, diversified providers, optimized task allocation, and structured vendor management, to help legal operations teams control legal spend and consider the use of enterprise legal management software without sacrificing service quality.