 I thought the online RFPs, where companies would bid out legal work, had gone the way of the tech boom, but it turns out one is still around. A company called Procuri.com held a competitive auction of legal work from GE Commercial Finance last month, according to an article in the January 2004 issue of Corporate Counsel.
I've talked to law firm marketers who've had to bid for legal work online, and they hate it. It forces law firms to compete on price and makes any personal relationships irrelevant. In fact the article commented, "The lawyer/client relationship has just gotten a little more impersonal."
GE Commercial Finance invited many of the nations largest law firms to participate in the Web-based competitive process on Procuri.com, which is a provider of "self-service strategic e-sourcing solutions" in Atlanta. Online auctions of corporate legal work were considered the wave of the future back in 2000, when the NASDAQ was at 5000. But as the Internet companies began to go bankrupt and vanish, it seemed that the trend went with them.
Procuri.com has previously hosted 1,900 online "events" for companies, including those needing lawyers to handle bankruptcy or due diligence matters, saving clients an average of 23%. "Many law firm partners say GE Commercial Finance's approach is only the most extreme illustration to date of how corporations view lawyers as being just as interchangeable as any other outsourced service provider," the article says.
I also recall that corporate general counsel didn't like online auctions, because of the hefty commissions the services charge. Also, they require a lot of technical hassle, which many GCs don't have patience for. The problem with online bidding, as I see it, is that it presumes all lawyers are created equal and have the same track record. They're not. Online bidding de-values personal relationships, which is what marketing is all about.
10:41:11 AM 
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