External Service Provider Guidelines define how law firms and other external advisers are instructed, governed, and managed in the context of disputes and litigation.

Within the Disputes Line, they are the primary control mechanism for aligning external adviser behaviour with the organisation’s risk appetite, settlement posture, cost discipline, and governance standards.

This Station exists because litigation creates a structural imbalance:
the organisation bears the risk and cost, while the firm is paid to prosecute the process.

Left unmanaged, that imbalance drives cost, complexity, and outcomes in the wrong direction.

External Service Provider Guidelines apply to all external advisers engaged in disputes, including law firms, barristers, experts, e-discovery providers, and litigation support vendors.

They govern not just who is engaged, but how litigation is run.

◼️Instruction Framework: defines when firms may be engaged and for what types of disputes.

◼️Reporting Standards: prescribes what firms must report, how often, and at what level.

◼️Merits Assessment: mandates objective, early, and ongoing case evaluation.

◼️Cost Governance: sets expectations for budgeting, scope control, and forecasting.

◼️Technology Use: requires adoption of efficient litigation support and e-discovery tools.

◼️Settlement Posture: governs how firms approach resolution discussions.

◼️Ethical Boundaries: addresses incentives that favour prolonged litigation.

◼️Performance Management: defines how firms are measured, reviewed, and retained.

Effective strategies include:

◼️Stage-Based Fees: fixed fees per litigation phase.

◼️Success Fees: linked to defined resolution outcomes.

◼️Cost Caps with Quality Gates: spend limits tied to pathway standards.

◼️Blended Rates: discouraging over-staffing.

◼️Early Resolution Incentives: financial upside for efficient settlement.

◼️Disallowed Activities: no billing for work outside approved scope.

◼️Technology Discounts: reduced fees where AI and automation are used.

The principle is simple: firms should be rewarded for judgment, not duration.

The External Service Provider Guidelines station is considered a Repeater resource within the GLS Legal Operations model.

A Repeater Resource: Supports the performance of multiple "critical" legal functions and as such represents a "ripple effect" productivity intervention point. 

A best-practice External Provider Guidelines framework exhibits the following characteristics:

◼️Explicit Role Definition: firms support Legal’s strategy; they do not define it.

◼️Early Merits Discipline: objective assessment is required before momentum takes hold.

◼️Continuous Re-Assessment: merits, exposure, and strategy are revisited as facts evolve.

◼️Proportionality Rules: litigation intensity must match claim category and pathway.

◼️Technology Mandates: firms must use efficient e-discovery and litigation tools.

◼️Cost Visibility: spend is transparent, forecasted, and actively managed.

◼️Settlement Neutrality: firms must present settlement options without bias.

◼️Ethical Transparency: incentives that favour delay or complexity are surfaced and managed.

◼️Outcome Focus: success is defined by resolution quality, not procedural thoroughness.

External Provider Guidelines deliver the following value to the business:

◼️Cost Control: reduces uncontrolled litigation spend.

◼️Outcome Alignment: ensures litigation supports commercial objectives.

◼️Risk Containment: prevents over-litigation of matters better resolved early.

◼️Decision Clarity: enables informed settle-vs-litigate choices.

◼️Governance Assurance: demonstrates active control over external advisers.

◼️Reputational Protection: limits unnecessary escalation and public exposure.

◼️Predictability: improves cost and outcome forecasting.

◼️Value for Money: ensures spend is directed where it changes outcomes.

◼️Reduced Dependency: avoids surrendering control to advisers by default.

External Provider Guidelines deliver the following value to the legal department:

◼️Strategic Control: Legal remains the decision-maker, not the firm.

◼️Merits Honesty: reduces optimism bias in external advice.

◼️Cost Leverage: budgets and scope anchor firm behaviour.

◼️Settlement Authority: prevents firms resisting early resolution.

◼️Time Protection: avoids unnecessary procedural complexity.

◼️Credibility with Finance: demonstrates disciplined cost management.

◼️Portfolio Consistency: similar disputes are handled similarly by firms.

◼️Professional Cover: protects Legal from hindsight criticism.

◼️Sustainable Relationships: sets clear expectations upfront.

This Station is essential for:

◼️Litigation-Heavy Organisations

◼️High-Value or Precedent-Sensitive Disputes

◼️Regulated Industries

◼️External Counsel–Dependent Models

◼️Board-Visible Risk Portfolios

◼️Cost-Constrained Legal Teams

◼️Multi-Jurisdiction Litigation Profiles

◼️Mature Legal Functions

Where External Provider Guidelines are absent or weak:

◼️Litigation Drift: matters become longer and more complex than necessary.

◼️Cost Escalation: spend increases without corresponding outcome improvement.

◼️Merits Inflation: weak cases are pursued too long.

◼️Settlement Resistance: firms discourage early resolution.

◼️Technology Avoidance: inefficient manual processes persist.

◼️Reporting Noise: updates focus on activity, not risk.

◼️Client Dependence: Legal defers excessively to adviser judgment.

◼️Governance Failure: decisions cannot be defended under scrutiny.

◼️Ethical Blind Spots: misaligned incentives remain unmanaged.

External Provider Guidelines must explicitly govern technology use.

In particular, they should mandate:

◼️E-Discovery Platforms: proportional, defensible document review processes.

◼️AI-Assisted Review: use of AI to reduce cost and increase insight.

◼️Early Case Assessment Tools: rapid analysis of evidence and exposure.

◼️Litigation Management Systems: shared visibility of milestones and risk.

◼️Secure Collaboration Portals: controlled information exchange.

◼️Cost Analytics Tools: real-time tracking of spend versus value.

◼️Outcome Databasing: reuse of insights across disputes and firms.

◼️Reporting Automation: standardised updates aligned to GC requirements.

◼️Governed AI Use: clear rules on ethical and responsible deployment.