to law 2.0 and beyond the shape of things to come
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To Law 2.0 and Beyond The Shape of Things to Come. Jeffrey W.Carr FMC Technologies. Or. Or. But Decline as % of Sales. Total Legal Expenses Increased -- Now Trending Down. Performance Benchmarking. Our Vision. We are not lawyers. - PowerPoint PPT PresentationTRANSCRIPT
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Innovative Technologies, Creative Solutions ™
To Law 2.0 and BeyondThe Shape of Things to Come
Jeffrey W.Carr
FMC Technologies
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Innovative Technologies, Creative Solutions ™
Or ...
Or ...
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Total Legal Expenses Increased -- Now Trending Down
But Decline as % of Sales
Legal Expenses
0.000%
0.100%
0.200%
0.300%
0.400%
0.500%
0.600%
2002 2003 2004 2005 2006 2007 2008 2009
Year
Perce
ntag
e of S
ales Ext$/Sales
Int$/Sales
Legal Expenses
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
2002 2003 2004 2005 2006 2007 2008 2009
Year
Ext-Gen
Ext-Lit
Ext-IP
Internal Expenses
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Performance Benchmarking
Category FMC Technologies
Mean Median
Exp/$Rev 0.284% 0.865% 0.497%
Int/$Rev 0.061% 0.215% 0.131%
Ext/$Rev 0.222% 0.609% 0.302%
Lit/$Rev 0.117% 0.297% 0.214%
IP/$Rev 0.083% 0.095% 0.11%
Total Legal/$Rev 0.330% 1.174% 0.809
Avg In-House $/Hr
$167 $212 $197
Avg Ext Cnsl $/Hr $250 $400 $385
Attny/$B 2.86 6.78 6.85
Legal Heads/$B 3.96 8.92 6.66
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Our Vision
• We are not lawyers.
• We are business people with legal training forged into a cohesive legal team committed to the success of FMC Technologies through focused effectiveness, relentless efficiency, constant improvement, creative disruption and unyielding integrity.
5
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Our 1º Law™ Tool Box
• Integrated matter management – Serengeti
• Performance based pay – ACES
• Early case assessment – Decision Pro
• Streamlining process – P-Card, Serengeti, Sharepoint
• Driving Performance – Meaningful metrics & Snapshot
• Delivery/Execution – Project & monthly MPR
• Leveraging internal knowledge – Sharepoint
• Leveraging external knowledge – Legal On Ramp
• Leveraging resources – “Cook Book”; Guidelines
• Leveraging time/space – Webex; Telepresence
• Continuous Improvement – L2A2
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The Matrix
IUrgent
Important
IINot UrgentImportant
IIIUrgent
Not Important
IVNot Urgent
Not Important
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The Circle
Avoid
Manage/ResolveEfficiently
Lessons Learned
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The Arrow
HealingDenial Anger Resignation Acceptance
Anarchy: Old style, silos, rules don’t apply to law
Cost focus: Supply chain management
Cost Focus: Reduce number of firms
Aggregated buy
Value Focus: Alliances, Partnering
Best practices
Value Extraction: Leverage
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The Atom
Experts
Lawfirm 1
Lawfirm 2
Legal Content/Research Provider
FactHolders
ProfessionalService
Providers
Lawfirm 3
In-housecounsel
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The Pyramid and the Funnel
vs.
Document Processors
Associates
Partners
$
Volume Centric Focus on Hours or
$/page
Value CentricFocus on leverage or
key info
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Bespoke CommoditisedStandardised Systematised Packaged
The Arrow – Redux
Hourly billing Fixed feesCommodity
pricing, tendingtowards zero
Marginal costs of delivery reduce
Source: R Susskind – “The End of Lawyers?”
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The Cloud
Customer/Client
Lawfirm 1
Lawfirm 2
Legal Content/Research Provider
Fact Holders
Professional ServiceProviders
Experts
In-housecounsel
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The Matrix Revisited
I
Advocacy
II
Counselling
III
Process
IV
Content
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Future
Fixed Fees
Budgets with Implications
Risked
Hourly Rates/ Efficiency
Expectations
Recent
Fixed FeesBudgets with Implications
Risked
Hourly RatesNo Budget Implications
The Pyramid – Stacked AFA’s
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• Variable (aka Non-Transformational)
– Discounts
– Blended Rates
– Freezing Rates
– Budgets w/o Implications
• Value (aka Transformational)
• Fixed Fees
• Budgets with Implications
• Risk Sharing
• Efficiency Expectations
The AFA Table
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The Arrow -- Again
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The FMC Litigation Value Challenge
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1° Law Litigation Value Challenge
Forum Objective Format Decision
Ph
ase
II
Ju
ne
20
09
Ph
ase
III
Au
g –
Se
p
20
09
Ph
ase
IM
ay 2
00
9
Legal OnRamp
This is about cultural fit,
innovation and capability
2 Page Yes/No Questionnaire
1 Page Excel Table Plus 140 character
“Tweet”
Indicative ACES Budgets: This is not an auction. It
is about value.
Private online
Selection based on interactive chemistry and
impact
Discretion of Firm – 10 topics suggested
In person meetings @ FMC
6 firms selected
Qualification
Economics
Wow Not Woo Meetings
16 Firms selected
52 Firms responded 32 selected
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The Challenge – Phase I
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The Challenge – Phase 2
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The Challenge – Phase 3• 33 firms invited to use Twitter and send a “Tweet”
– 140 characters or less
– What makes you different?
– Why should we meet you?
• 16 firms invited to “Wow not Woo” Face of Face Meetings
– Format up to firm
– Memorable moments
• Poem
• Video of the making of the tweet
• Role play of intake meeting
• Process mapping
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The Decision
• The Team
– Beirne Maynard
– Fulkerson
– Littler
– Seyfarth
– Summit
– Sutherland
– Valorem
– Womble
• The Structure (TBD)
– Plan A
• JV to leverage capability – Plan B
• Shark Tank (mini-RFPs)
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Your Future
This?
Or This?
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“If you dislike Change, you’re going to dislike Irrelevance even
More.”
US Army Chief of Staff, Gen. Eric Shinseki