“Overbill me once, shame on you. Overbill me twice, shame on me. Overbill me now – when I have a lot more work and a lot less budget – and it’s time for change,” writes David McVeigh, CEO of Axiom.

It’s fair to say, at the risk of putting words into his mouth, that Mr. McVeigh,  a former McKinsey consultant, is fed up. He even hearkens back to the former GC of Cisco, who in 2008 fired a well-publicized shot across the bow of BigLaw  and their billing models, which he called “the last vestige of the medieval guild system.” And McVeigh does recognize that there have been reactions from the client community, including heavy investment in in-house teams – a model McVeigh says is tough to sustain in a cost-reduction environment. “Yet here we stand again, looking at another year of law firm rate increases,” he says. “This time, however, feels different. This feels like the first-time in-house leaders are actually ready to reject the old binary ‘staff up or send out (to law firms) paradigm’. This time feels like the first year GCs are not only frustrated enough, but also empowered enough, to let their actions do the talking.” McVeigh isn’t just spouting off. He cites five reasons why this will be the year in-house leaders meaningfully transform the sourcing model: rates are anticipated to jump between 7% and 8%, the largest increase in at least 15 years; as firms such as Cooley trim their fat with layoffs, clients will find themselves paying more and getting less in return; such rate hikes are completely out of whack with current economic conditions; and law departments can’t just cut back as they get busier and busier, which opens a clear path for another option. “The right legal resource, when cost mitigation is paramount, is flexible legal talent,” McVeigh says. “By incorporating more flexible lawyers into their resourcing models, GCs can reduce increasingly expensive law firm engagements to those exceptional, high stakes events for which their rates are warranted. But for everything else, enough is enough.” Read more at CCBJ