ELM Amplify 2020, the ELM Solutions annual user conference, took place online from October 20 through 22. This event is still available for on-demand viewing here, and we continue to highlight some of the sessions that were presented.
Over the last several years, many corporate legal and claims departments have introduced alternative fee arrangements (AFAs) into their spend management programs. Those who have used AFAs have had varying levels of success, however. In a panel session called Meet the Companies that Are Walking the AFA Walk, we were joined by several legal professionals who talked about how their organizations achieved success with their fee arrangements from both the legal department and law firm perspectives.
Here are just a few of the best practices that our expert panelists recommended:
- Rea Koren, Senior Project Manager, Corporate Legal Operations, UnitedHealth Group: Be sure to capture and present the right data. Your goals may shift over time and your knowledge will grow. As your operations and understanding evolve, update the ways in which you use your ELM system, including the reports you run. To optimize your AFAs, you’ll need data about your historical spend and special discounts. You should also make sure that specific teams within the law department can drill down to get the exact data they need on their areas of responsibility.
- Estelle Rhee, Senior Business Analytics Specialist, Microsoft: Success with AFAs depends on establishing and maintaining a trustworthy relationship with outside counsel. While providing you with better pricing certainty, AFAs can sometimes make scope uncertain for firms. If you focus on the long-term relationship with the firm and understand their pain points, you’ll be better able to arrive at an AFA that meets your needs and theirs and supports long-term success for you both.
- Terry Williams, Head of Client Finance Operations, Hogan Lovells US: Put in the necessary time at the beginning to allow the work to progress organically further on in the process. It helps to have AFA templates ready and to tailor them for individual matters. Sharing data from both the legal department and law firm sides can help give everyone perspective to agree on a mutually beneficial AFA. It takes longer, but you will save time that would normally need to be put into budgeting, billing, recoding, etc.
- Chris Sweet, Chief Operating Officer of Parker Ibrahim & Berg: It is important to be clear about what exactly you are trying to accomplish with your AFAs. Is the goal cost reduction, budget certainty, or some other improvement? Have conversations with the firm to share the goal and show them any data you have on billing, as well as calendaring, document management, settlement offers, and anything else relevant to the matter. Talk with them about how to create a sustainable AFA and approach it with some flexibility to keep the relationship positive.
To access a recording of this informative panel discussion and learn much more from these experts, visit the ELM Amplify page and fill out the registration information or, if you previously registered for ELM Amplify, click the Already Registered button and enter your email address. Once you’re in the event page, click on Theater at the top and select Agenda for a list of all on-demand videos. For this session, click the On Demand button next to AFA Panel: Meet the Companies that Are Walking the AFA Walk.
While there, be sure to check out our other on-demand sessions for more valuable information and thought leadership.