Legal Department Benchmarking

Updated February 3, 2025 | Argopoint Consulting

WHY LEGAL DEPARTMENTS NEED BENCHMARKING

In their quest to be "best-in-class", legal department leaders are looking to assess the capabilities, resources, effectiveness and efficiency of their organizations.  General counsels want to know how to measure legal department performance, how to track key legal metrics, and how the top corporate law departments are managing legal spend and efficiency. What are the cutting edge solutions to your most pressing challenges? Enter legal department benchmarking.

Argopoint legal department benchmarking data helps cut costs, communicate value to executives, justify the resources of the legal department, and form the basis of the legal department strategic plan, all via  objective, numerical data and qualitative interview commentary from a set of similar peers and top departments in the relevant industry.

Benchmarking is one of the most enduring management tools used by legal leaders to enhance effectiveness and productivity. 

CHOOSING BENCHMARKING QUESTIONS, METRICS, AND PEER SET

Finding the right benchmarking data for corporate legal departments is no easy task. There are, of course, the general and basic metrics which most benchmarking will include - legal department spend vs. company revenue, or support staff percentages, for example - but even more important than those are the qualitative commentary from leaders of peer departments that gives a “full story” to the data. And equally important is choosing which peer departments to survey, so that the data output represents both an appropriate specific subset of applicable peers and also an “aspirational” set that includes leaders in the industry - thus giving a picture of how you are performing vs. current state and also a target “future state”. From there, you can choose more advanced and custom benchmarking questions to address your specific challenges - these could be anything, but for just one example, what are peers offering for standard terms on indemnification for a certain type of contract, and what is the average cap peers offer for limitation of liability?

Argopoint is deeply experienced with crafting these more advanced, high-impact benchmarking questions.  Our proprietary benchmarking (and metrics) methodology yields “decision-grade” insights and recommendations that drive meaningful changes for our clients – We create a completely customized and proprietary suite of metrics and accompanying interview questions for each benchmarking client.

Our benchmarking typically identifies improvement opportunities that offer savings and benefits that are at least ten times the cost of the study. 

STRATEGIC AND PERFORMANCE INSIGHTS BENCHMARKING OFFERS LAW DEPARTMENTS

Discovery of Innovative “Best Practices”

Our experience suggests that it is likely that almost every function performed by corporate legal departments has been studied, improved and potentially optimized by another admired corporation. We identify the “best practices” being used by these leaders and offer insight into how to most appropriately adapt them to the situation of our clients.

Recruiting Valuable Companies to Benchmark

Improvement opportunities are often missed due to an unwillingness to identify the “best practices” that outside of the organization, and outside of the industry. We are experts in developing the right mix of study participants and recruiting them to participate in benchmarking. 

Information Tailored to Client Needs

Benchmarking data is incomplete without considering relevant context and the operating environment. Rather than producing a generic, meaningless set of data, we use a collaborative approach with our clients to ensure our benchmarking studies and data are tailored to their needs. Among other factors, we take into account our clients’ business strategy and objectives, business structure, historical conditions, personnel capabilities and position relative to competitors to provide insight into key topics.

Impartial Perspective

Often leading corporate legal departments fail at improving performance and enhancing cost-effectiveness because they primarily look inward, rather than outward, for solutions. We offer an impartial perspective, without predispositions to the status quo, which enable us to conduct best-in-class legal benchmarking exercises. 

Understanding where your department is on the journey, and how progress on that path can be accelerated is a critical first step.  Argopoint's expertise and knowledge of leading departments "best-practices" are reasons why legal department leaders speak to us first when they want to get started.