Problems/Issues
GlaxoSmithKline (GSK) has an inefficient procurement process in the legal department. The traditional procurement methods were not suited to the unique needs of the legal department. In short, standard procurement practices were not working. The lawyers were skeptical about having to use the same procurement processes as other departments, and their skepticism led to resistance.
Another issue was the high legal spend. GSKs litigation exposure was to the hundreds of millions of dollars. The legal department spent a lot on outside counsel. There was no budget for individual lawyers, which contributed to the high legal spendan unnecessary cost.
Plus, a lack of a central management made it difficult for the company to monitor and control its legal spend. It also meant that the company was not totally aware of its potential spending power, which it should have been leveraging so as to get better rates with other firms.
Possible Solutions
One possible solution could be to introduce a new system with a reverse auction mechanism. In a reverse auction, law firms would bid for GSK's legal work (Horlen et al., 2005). This would allow for direct competition...
AFAs would let GSK pay a fee structure based on the value of the services rendered (Corrigan, 2021). This could include flat...…doingcapital that could then be deployed elsewhere more profitably.Additionally, centralizing the management with the Global External Legal Relations Team would let the company better identify areas for cost reduction, negotiate more effectively with law firms, develop a more transparent approach to legal spend by ensuring that all funds and budgets are tracked and managed centrally.
Finally, the new procurement process and AFAs would also help GSK to obtain good legal representation while controlling costs. The reverse auction system would draw attention from law firms looking to offer their best lawyers at competitive prices. AFAs would ensure that law firms are compensated by what they deliver (a merit-based system, in other words). All in all, GSKs legal representation would improve,…
References
Corrigan, S. (2021). Alternative fee arrangements. Man. LJ, 44, 134.
Cremona, M. (Ed.). (2008). Developments in EU external relations law. OUP Oxford.
Horlen, J., Eldin, N., & Ajinkya, Y. (2005). Reverse auctions: Controversial biddingpractice. Journal of Professional Issues in Engineering Education and Practice, 131(1), 76-81.
Kritzer, H. M. (2004). Risks, reputations, and rewards: Contingency fee legal practice in theUnited States. Stanford University Press.
Van Tulder, R., & Mol, M. (2002). Reverse Auctions or Auctions Reversed:: First Experimentsby Philips. European Management Journal, 20(5), 447-456.
Management Development Techniques All business organizations seek to maximize the profitability using the least available resources. The bottom-line in realizing such coveted success is by making their management processes efficient. In this regard, managers will often employ various techniques in developing and improving their existing management styles. This is because new issues always would come up and have to be addressed through the necessary change management initiatives. This study will look
Management accounting is an important factor that helps organizations to map their future directions through providing managers with necessary information for the establishment of strategies that ensures all inputs, processes, and outputs are in line with the organizational goals. Through the information provided by management accounting, managers access information that is critical in formulating policy, making comparison between alternative situations, and evaluate and examine performance. While management accounting has similar
Managing Diversity and Equal Opportunity With the turn of the 21st century, a dramatic increase is being witnessed in the international flow of labor with repercussion for domestic labor supply and management. The native, racial and emigre mixture of the employees is predominantly important for the workplace. The importance of this domestic cultural multiplicity in the labor force, highlighted by worldwide influences and necessities, has lately encouraged the researchers to focus
Management vs. leadership in nursing Managers and leaders, though they are often thought to mean the same thing, are actually different people in an organization. Managers are involved in controlling and guiding the activities in the organization through effective supervision and handling while leaders are those who motivate their followers towards meeting a common goal. There are also significant differences in the characteristics and behavioral descriptions of managers and leaders. However,
The use of managerial accounting to keep profit margins where they need to be and make sure that individual product offerings are not a net drain on the company is not the only thing that Thai Airlines can and must do to keep a competitive edge and to protect themselves from things like corporate malfeasance and terrorists attacks, but it is certainly a major thing that should be take
Management Principles Management Leadership Model Paper: Management Principles Research suggests that everyone is a manager in their own way. For instance, everyone manages his finances, time, careers and relationships. These examples of managing are simple and straightforward. However, when concepts of management apply in organizations, management becomes complex. At such a point, it calls for extensive studying in order to understand the theoretical basis of management. The application of management and the enunciation
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now