Bracing the Budget
During an economic downturn, the instinct for many legal departments is to batten down the hatches and, like General Mills, preserve as many internal resources as possible while slashing the outside counsel spending. Three-quarters of respondents say they brought more work in-house to control costs in 2008, and 39.5 percent say keeping matters in-house was their most effective cost-cutting measure. Others found limited success by using alternative fee arrangements with outside firms, delegating more work to non-counsel staff and employing technology.
Even as legal departments bring more work in-house, Jim Wilber, principal at Altman Weil, anticipates staff sizes to stay the same. "I think that the word of the year for general counsel is going to be 'How do we do more with less?'" he says.
Although one-quarter of legal departments have reduced staff to trim costs, staffing remains relatively stable. The median department budget for compensation, benefits and bonuses rose slightly in 2008. While in-house counsel anticipate a small decline in 2009 figures, their projected staffing budget holds fairly steady.