In-House Counsel

Experience curve theory and plausible applications in law departments

By Rees Morrison

Research at various manufacturers has shown that as production doubles, the hours required to make something falls by a fairly consistent percentage, on the order of 10 to 30 percent. As volume builds, workers become more productive. Edward Russell-Walling, 50 Management ideas your really need to know (Quercus) at 80, discusses the experience curve theory, but doesn?t explicitly apply it to a service context.

Still, it makes sense that increased experience increases efficiency. Other posts have alluded to the plausibility of an experience curve for law department attorneys who handle a number of transactions of a similar kind (See my posts of Nov. 6, 2006: delegate to go up the efficiency curve; May 31, 2006: the sigmoid curve of management initiatives; Feb. 2, 2008: specialist billers at law firms and learning curves; Oct. 10, 2006: core competencies and skill curves; and July 15, 2006 and June 20, 2007 # 1: Horndal effect of increasing productivity.).

We may not know how to measure the output of a contracts lawyer, but it makes intuitive sense that if that lawyer does twice as many more of a kind of contract, the time required to do the average one in that second batch drops by 10-30 percent.

Full post as published by Law Department Management on May 21, 2008 (boomark / email).