Positioning the Legal Department at the Heart of the Business
The Change in the In-house Counseling Position and Role
In the last ten years the in-house legal profession has grown rapidly and consistently. Now approximately 20-25% of lawyers work in-house, and in the UK, the in-house counsels market doubled itself in the past 15 years and currently, one of four counsels work in-house.
The role of in-house counsel has also changed significantly . In-house counsel no longer needs to be solely focused on the law, but also on other “non-legal” tasks. There are many reasons for this, including, among others, the economic environment, globalisation, mergers, governance concerns and competition. In-house lawyers need to deal with – and be experts in – a long list of issues, such as:
- Cost effectiveness and ROI (Return on Investment)
- Data and knowledge management (including BigData)
- Reporting and analytics
- New technology / LegalTech
- Project management
- Business decision making.
From a “Responsive” Troubleshooting Role to a Strategic Business Partner
One “role” that is commonly forgotten by in-house lawyers is their that of a strategic business partner, contributing to the core of the organisation. This goes far beyond a trouble-shooting or problem-solving role. An in-house lawyer must also take the initiative to address core business concerns and become indispensable to the wider organisation.
It is important that management recognises in-house lawyers’ contribution to the business and it is a key factor in an in-house lawyer’s success. Any in-house lawyers that fail to position themselves this way risk being sidelined or having their roles outsourced.
Beyond (re)branding their role and position in the business, in-house lawyers must generate and deliver a strategy for success and a clear business plan for their wider team. Bottom line, this means running the legal department like a business within a business.
Besides dealing with legal matters, in-house lawyers should spend a significant amount of their time on:
- identifying gaps in the service of the wider business;
- developing cross-departmental joint solutions
- creating a clear vision, goals and priorities
- collecting and analysing accurate data
- providing detailed reports that demonstrate the “business value” of in-house lawyers
Legal Tech – Running the Legal Department as a Business within a Business
Using knowledge management, contract lifecycle management, entity management and e-billing LegalTech tools can help in-house lawyers to create an accurate, real-time legal database.
These tools can help keep track and provide visibility of legal matters and costs. They enable in-house counsel to demonstrate that the legal department is using minimum costs to provide maximum results. In addition, they enable the legal and financial teams to set up clear financial guidelines and strict budgets and alert each other upon any deviation from the guidelines.
Arich and accurate legal database will enable the following capabilities and, by doing so, optimising the legal function of the business both from a professional and operational point of view:
- monitoring and managing (legal) data
- learning from past actions and their results (both business and legal)
- making data driven decisions
- increasing the accessibility to legal data
- keeping track of the performance of tasks
- managing the workload and dealing with it in advance
- highlighting potential cost savings
- identifying gaps and trends
- making informed choices and taking calculated risks
- making accurate and “realistic” forecasts
- reducing administrative time
- streamlining the work (both from financial, procedural and operational points of view).
If investing in legal technology would bring so many benefits for the wider business, , how come in-house counsel encounter endless difficulties in getting budgets for purchasing and implementing the necessary technologies or tools?
Justifying Investment in Legal Tech – Positioning the Legal Department as a Productive-Business Unit
There is no doubt that the legal department provides value to an organisation. Investing in the right technology may increase added-value and optimise the legal function’s work and performance. As a result, the entire organisation will benefit.
Nevertheless, in many cases it is difficult for in-house legal teams to get the necessary budget and resources to research and purchase the necessary legal tools. Among other reasons, it is often due to the fact the legal department is commonly not considered to be a productive business unit but rather a necessary overhead.
How can we change this perception? The answer is quite simple. In-house lawyers must present a clear business case that demonstrates the value of such investment to the entire organisation. Needless to say, that value will never be solely (legal) costs savings.
In-house lawyers need to objectively demonstrate the added-value the legal department offers to the organisation, and make it clear that by investing in the right technology, the added-value it can offer will increase. For example, investment in LegalTech could reduce time and resources spent in finalising deals, empower legal consumers by providing them with permission-based access to data, create optimised processes, reducing and perhaps even eliminating bottlenecks, enable learning from past actions and their results (both business and legal), manage the legal workload, by identifying gaps and trends.
Implementing any technology should be done after exploring and exhausting the current technologies and their capabilities, based on the organisation’s tolerance and openness for new tools and with a “baby-step” approach.
After getting the initial approval from management and implementing the first step – whatever it may be – it will become part of the organisation’s culture and a “way of life”, so further investment in the legal department are just a matter of time.
About the author: Adv. Edo Bar-Gil is head of the Legal Ops department at LawFlex – an international legal outsourcing company located at Israel – the Startup Nation (https://www.lawflex.com/)