In the last decade, a noticeable, if not radical, shift has developed in the relations between corporate and outside counsel.

Professional chat rooms and journal literature are replete with what has become the mantra for the management of outside counsel: Legal services must be reined in and replaced with strategic partnering in the management of the client's business. As a result, corporate counsel are looking to outside counsel to take a proactive partnership in the conduct of the client's business.

Outside counsel and corporate counsel, often adversaries in years past, are exploring ways to develop an ever-evolving partnership. Alternative fee arrangements, outsourcing legal and support services and anticipating issues before they become the next front-page mass tort -- this is the evolving relationship between today's corporate and outside counsel.

Yet the disparity in perception remains real. In the Ninth Annual Corporate Legal Times-Arthur Andersen LLP Survey of General Counsel, law firms gave themselves higher grades in creativity, client relations, communication, cost and billing, problem-solving, responsiveness, risk-sharing and value than the grades given by the evaluators, the clients.

How can in-house counsel attempt to diminish this myopia in perception? The means are remarkably simple: Lawyers who understand the client's business goals -- as partners, not adversaries -- can formulate plans that further those goals. To do this, clients and firms can implement the following strategies:

• Decrease the number of law firm providers to a national network of full-service counsel.
  
  
• Retain counsel who anticipate risks and who, on the basis of experience, counsel and advise the client in ways that minimize risks and further the company's business.
  
  
• Expand nontraditional relationships with providers, such as contract-staffing companies, document vendors and legal research experts, that permit the law firms to do what they do best: practice law and counsel the client.
  
  
• Explore alternative billing arrangements that provide an incentive to the law firm to work for a long-term relationship and to the client to continue to manage fees and costs.
  
  
• Create a system of communication through the Internet and state of-the-art technology that increases the efficiency of communication.
  
  
• Encourage counsel to share the bad news as well as the good in a timely manner.

One innovative way to foster these goals is to create a proactive law committee within the company. The group should include members of senior in-house counsel, counsel from outside law firms and representatives from legal services providers.

In providing this service the committee should collaborate with both outside and in-house counsel to draw on experiences that identify legal issues affecting the company's day-to-day business. These range from attorney-client issues to the creation of manuals that simplify the tasks of in-house counsel and other employees.

The committee should identify emerging legal, regulatory and legislative issues that confront the company, state-to-state and nationally. It should provide information to the client that helps all employees and departments perform their jobs in a more efficient, knowledgeable manner. This include providing handbooks, seminars, frequently asked-question guides and online training programs.

Additionally, the committee should document for executives changes in the law that may provide an opportunity for business growth or improved customer relations.

One of the areas in which law firms gave themselves higher grades than those received from legal departments was in "business savvy." Similar reports were made for "client relations" and "communication."

Law firms assume that as they represent their clients, whether in litigation or negotiation, they have gotten to know the ins and outs of the client's business. But clients are asking for more. They are insisting that counsel, on their own nickel, spend a day or two with clients learning the business.

This doesn't mean that counsel should only get to know the department for which they are doing the work. Outside counsel should understand the workings of the entire business. The lawyers should meet department heads and listen to the nature and extent of their role in day-to-day operations. These outside counsel should listen to the problems that department heads have as well as the solutions they might formulate together.

E-mail addresses should be exchanged and the client provided with updates about current industry or government news. Some corporate counsel invite members of the law firm to attend boards of director meetings, not as counselors or advisers but as listeners.

Some law firms have developed formal interviews to better understand the clients' needs and expectations. One approach includes the director of business development, the lead engagement partner and a representative of the firm's executive management.

The interview should be an open dialogue that will review the client's business and departmental trends and issues, examine the firm's past performance and identify all areas the client would like to see enhanced with outside law firms.

The interview should include a focus on the client's business and departmental needs. What service needs does the company have? Which firms or resources does it now turn to for help? What role has the law firm played in helping the client address past needs? What challenges is the client facing in the months and years ahead? Although the firm may think it knows the answers to these questions, there is a greater value in letting clients express their own views and perceptions.

It is important to look at the service the firm has delivered. This discussion will revolve around attributes such as responsiveness, communication, skills and capabilities of personnel, delivery on commitments and overall value. It's the one opportunity for the firm to conclude a case on a positive note rather than to close the deal with the final invoice for services rendered.

Finally, the client should be asked to describe the ideal relationship with a model service provider. This information is critical to defining tangible goals for closing the gaps between the firm's current service levels and the client's ideal.

Preparation is the key to a successful interview. The business-development group can compile a concise overview of the client and its business. Information can be extracted from such sources as Dun & Bradstreet, the Internet, market analyst reports and a listing of recent lawsuits. The accounting department can generate historical engagement information (matters, fees, write-offs, etc.) for inclusion in the briefing packet.

The law firm participants must meet for about two hours prior to the client interview to discuss past service delivery, perceived issues or "pressure points" in the relationship and the desired outcome of the session. Obviously, the client-service partner who arranges the interview should confirm that it will take place the morning before the interview.

During the interview, the meeting "belongs" to the lead partner, who is in the best position to respond to any needs, issues and opportunities identified during the session. The lead partner should open the meeting by introducing other interview-team members.

After that, participants should engage in a discussion with the client as in any business meeting. However, these rules should be strictly followed: Let the client do most of the talking and never react defensively to what the client expresses. The goal is to better understand the client and its needs, not to explain, defend, justify or sell.

Some interview questions could include the following:

• Understanding client needs and goals. Before discussing our service performance, can you give a brief description of your department, how it is structured, and its goals? Do you see these goals changing in the next few years, and how? How do you know when your department is successful? How do you measure success? How are your legal support needs changing? What are the issues that interest or concern you the most?
  
  
• Review of past performance. What prompted your initial request for assistance to our firm? What were your perceptions of the firm at that time? What were your service expectations upon hiring the firm? Did the firm understand your service needs and work to satisfy them? Do you feel we have consistently delivered on our commitments? Were you satisfied with the results of our work? Do you feel we have the appropriate service team managing and staffing your matters? How would you characterize our service strengths? What suggestions can you provide for improving the performance and value of our services?

If necessary, prompt the client to discuss the quality of the work product and of the advice and counsel, the accessibility and responsiveness of team members and success in keeping the client informed.

• Client relationship model. Please describe an ideal relationship with a legal services provider. If you were us and were trying to provide legal services to yourself, what bases would you be sure to cover? How do you define "quality"? What is "value" to you? Think of your best relationship with an existing service provider. On a scale of 1 to 10, how close do they come to your "ideal"? How close has our firm come to your "ideal"? Are there any other issues or opportunities you would like to discuss?

At the end of the interview, the law firm participants should formulate an effective service plan. Within a day after the interview, the team should construct an approach to address the client's needs and concerns.

In all likelihood, opportunities to expand the firm's service involvement with the client will have surfaced during the interview. This is an opportunity to objectively step back and understand exactly what the client has said. Approaching this with an open mind will help identify new areas of business.

A week after the interview, a follow-up meeting with the client should be scheduled to discuss the service plan. During this meeting the firm can discuss new services to either resolve stated problems or optimize opportunities the client identified.

The mantra used to be "location, location, location." In today's legal world, it's "communication, communication, communication." Firms open to this shift in client relations will understand that this is precisely what corporate clients respect and insist on.