Definition
The 'Total External Spend by Vendor' metric is used to identify key influencers in the legal department's total external expenditure. This analysis includes a breakdown of spend across law firms, ALSPs, and any other external vendors.
When reviewing TESV, often by applying the Pareto principle (the 80/20 rule, which states that roughly 80% of effects come from 20% of causes), you may find that a small portion of vendors drive the majority of costs. This insight may empower the legal department to focus its attention on these top vendors, for various strategic initiatives, such as relationship management, risk management, and negotiating service costs.
Data Sources
External spend data can be sourced from invoices, e-billing systems, and matter management or vendor management systems containing essential vendor information, including matters, fees, and expenses.
Filters
Business Unit
Practice Area
Location/Jurisdiction
Others
Limitations
The Pareto principle may not always apply, especially when multiple law firms are engaged due to the nature of legal matters, regional complexities, or the need for specialized expertise. Analyzing these factors can reveal opportunities for cost-saving through vendor consolidation, which can simplify management and reduce expenses.
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InfiniGlobe is a full-service consulting and software company. We have 20+ years of industry experience working with top corporate legal departments and law firms. Contact us at info@infiniglobe.com or at (833) LGL-TECH.
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