Legal department benchmarks 2024: ACC report takeaways

Do you know whether your legal department is ahead of the curve or falling behind? 

From key performance metrics to the latest tech trends, this year’s ‘Law Department Management Benchmarking Report’ by the Association of Corporate Counsel (ACC) covers a range of topics from key performance metrics to the latest tech trends.

The aim? This wealth of information enables legal departments to measure their effectiveness, make smarter resource decisions and boost process improvements.

You can read the Executive Summary and download the full report here.

For a quick digest, we’re covering three of the key takeaways. 👇

Takeaway #1: Cost management and efficiency

The ACC's 2024 benchmarking survey sheds light on a pressing issue for legal departments: rising external legal costs. Let's break down the key findings and their implications.

Outside counsel and Alternative Legal Service Providers (ALSPs): A growing expense

• Median spend on outside legal services: $1.8 million
• Top 25% of departments: at least $11.2 million annually
• Top 10% of departments: $41+ million annually

These figures highlight a clear trend: as businesses expand and legal matters become more complex, the reliance on external expertise is increasing significantly.

The revenue impact

Legal spend remains a significant cost:

• This year’s results show a slight decrease in median legal spend as a percentage of company revenue compared to 2023.
• Average allocation: 0.50% of revenue.

• This, however, reflects the different composition of the survey population rather than any significant decrease in legal expenses.

   

With this figure remaining high, it is prompting legal departments to scrutinize their spending.

The need for better visibility

As costs climb and complexities multiply, many legal teams are finding themselves in need of clearer insights into their spending patterns. Improved visibility isn't just beneficial—it's becoming essential for effective management.

Leveraging technology for better control

This is where advanced legal spend management solutions like Apperio come into play. These tools offer:

• Real-time insights into spend patterns
• Data-driven decision-making for resource allocation
• More accurate budgeting and cost control

The goal isn't simply to reduce costs, but to optimize the value derived from legal spend.

Takeaway #2: Headcount and structure

As companies grow, so do their legal needs. The ACC's 2024 Law Department Management Benchmarking Report highlights exactly how legal teams are scaling to meet these challenges.

Legal team size versus revenue: It's all relative

• Big companies, big legal teams: Companies with $20B+ revenue typically have 158 lawyers
• Smaller firms, leaner teams: Under $1B revenue? Expect just 2 lawyers
• Under $1B revenue: Median of 4 legal staff

• Over $20B revenue: Median of 158 legal staff

   

This stark contrast highlights how legal complexity scales with company size.

The rise of legal ops

Legal operations professionals are being utilized for efficient legal departments:

• Companies with $1B+ revenue are increasingly building legal ops functions
• Larger companies have 1-6 legal ops professionals (median values)

These specialists are key to managing the growing complexity of legal operations in larger firms.

What does this mean for you?

Whether you're a small firm looking to scale or a large corporation aiming to optimize, these trends highlight the need for:

1. Scalable legal management solutions
2. Tools that enhance visibility across all legal functions
3. Strategies to integrate specialized roles like legal ops professionals

As legal departments evolve, the right structure and tools become crucial for balancing headcount, efficiency, and growing legal demands.

Takeaway #3: Legal technology adoption

The legal world is going digital, and fast. The ACC's 2024 report shows how legal departments are embracing technology to boost efficiency and streamline operations.

Tech tools making waves

• eSignature: The clear front-runner, adopted by 71% of departments
• Contract management systems: Close behind at 59% adoption

• Legal spend management: A growing priority for cost-conscious teams

   

While eSignature and contract management are in the lead, the increasing focus on financial oversight highlights the rising importance of tools like Apperio.

Size matters in tech adoption

• Large enterprises (revenue $20B+): Heavy users of eBilling and matter management systems (80-88% of usage). The results signal a focus on automation and efficiency in core legal workflows for larger organizations.

• Mid-size and growing firms (revenue $1bn to $5bn): Leaning towards quick-win solutions like eSignature (40-60% of usage).

   

It's not one-size-fits-all when it comes to legal tech adoption. Legal teams need to find solutions that address unique needs and can integrate with other systems.

What this means for legal tech providers

The diverse adoption patterns across company sizes present both challenges and opportunities:

• Large enterprises: Looking for comprehensive, integrated systems
• Smaller firms: Need cost-effective solutions targeting specific pain points

Understanding these nuances is key to developing tech solutions that truly resonate with legal teams. And that’s where Apperio comes in. Apperio's scalable solution caters to this growing demand across the spectrum of legal department sizes.

The bottom line

Legal technology is no longer optional – it's essential. From budgeting to matter management, digital tools are transforming legal operations. Legal spend management, in particular, is becoming a cornerstone of efficient legal departments.

For legal teams looking to optimize their operations and gain control over their spending, solutions like Apperio offer a powerful way to drive efficiency and make data-driven decisions.

Empowering legal departments in 2024

The ACC's 2024 Law Department Management Benchmarking Survey reveals a growing trend towards increased external legal spending, more complex team structures, and a rising adoption of digital tools.ll of which highlight the growing need for sophisticated legal spend management solutions like Apperio.

For instance, with median outside counsel spend reaching $1.8 million and legal departments scaling up to meet growing demands, the need for real-time financial insights and strategic spend management stands out.

Apperio is ready to meet these challenges head-on, offering a solution that aligns perfectly with the nuanced needs of modern legal departments. Our software provides real-time visibility into legal spend, actionable reporting, and the tools necessary to make data-driven decisions. Whether you're a small firm looking to optimize your limited resources or a large corporation managing a complex legal ecosystem, Apperio offers the insights and control you need–including managing diverse team structures and controlling escalating external costs.

Ready to modernize legal processes? Get in touch with us today.