Legal Pricing and Project Management Pros Commanding Competitive Salaries, But with Disparities

Topics: Billing & Pricing, Business Development & Marketing Blog Posts, Client Relations, Data Analytics, Law Firm Profitability, Law Firms, Legal Innovation, Legal Operations, Process Management, Reports & White Papers, Surveys, Thomson Reuters, True Value Partnering Institute

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The burgeoning field of legal operations has been the source of much discussion on both the buy- and sell-side of the legal market in recent years.

This increased focus on how legal services are delivered is evident in the ascendancy of organizations like the Corporate Legal Operations Consortium (CLOC) and in the shifting focus of conference agendas across the industry, where topics like pricing, project management, and practice management are now mainstays of panel discussions.

Law firms in particular seem to be increasing their focus on these functions in meaningful ways, not the least of which is the hiring of new stables of professionals to oversee these functions. But with a high degree of innovation can come disparities in terms of how teams with seemingly similar mandates are structured and, perhaps more importantly, compensated.

The Legal Executive Institute was pleased earlier this year to have the opportunity to partner once again with the True Value Partnering Institute by sponsoring the Institute’s second Legal Pricing Professionals Compensation Report and its inaugural Legal Project Management Professionals Compensation Report. Rees Morrison, director of General Counsel Metrics, also was a vital partner in creating both these reports.

These two reports provide an insightful look into how law firms are building out their legal operations functions, the people they’re targeting to fill not only leadership but also frontline contributor roles, and the kinds of compensation these professionals are drawing.

You can download the executive summary of the Legal Pricing Professionals Compensation Report here; and the executive summary of the Legal Project Management Professionals Compensation Report here.

And you can download the full results of the surveys at the True Value Partnering Institute site here.

Both reports are remarkable for a number of findings, but perhaps the most interesting may be the general lack of predictability in the findings. For example, many observers, myself included, might surmise that professionals with law degrees might command higher salaries than those with other types of educational backgrounds, if for no other reason than that law firms tend to look favorably on those with legal backgrounds. But the findings in these reports indicate that is not, in fact, the case. Compensation is tied more closely to the title of the role held by the individual rather than to that individual’s level of education. A legal pricing analyst with a four-year degree is likely to be just as well compensated as one with a law degree.

Equally interesting is the wide range of salaries earned by professionals in these disciplines, particularly among those in leadership roles. Chief-level officers, for example, reported a disparity range of more than $467,000 between the highest and lowest reported levels of total annual compensation. Indeed, some C-level officers reported total annual income that is likely significantly below the compensation paid to other members of their firm’s C-suite.

It is likely that many of these disparities will self-adjust over time, but studies like these will hopefully help bring some parity to the industry and help top-level professionals understand the level of compensation they may expect.

Further, as the importance of legal pricing and project management professionals seems unlikely to wane in the foreseeable future, it will be fascinating to watch these roles develop through studies like this.