It is essential that in-house counsel remain at all times not just a manager of risk and litigation but rather a strategic partner with the business team.
It is essential that in-house counsel remain at all times not just a manager of risk and litigation but rather a strategic partner with the business team. What this means and to what extent the legal department plays such a role varies from one in-house department to another, but it is critical that in-house leaders think about how the department adds value for its clients and how its strategic plans align and advance those of the client.
At the end of the day, this strategic role is what gives in-house counsel job security. Also, the fact that the department is able to deal with the day-to-day legal matters but also understands the client, the business, the industry and helps advance the objectives of the client is what earns the legal department a seat at the boardroom table.
I am not unmindful that the amount of strategic planning and objective setting that an in-house department can do is often limited by factors such as the size of the legal department, time constraints, the different workplace cultures (which may have different views as to the role of legal) and, ultimately, the levels of autonomy that the department has in setting its own strategic plans and objectives. That being said, I think that the following points represent some good strategies that all in-house should consider implementing to add value and become increasingly strategic:
• Every legal department should have “client service standards”: This document lists commitments that will guide the legal department in servicing its client. It can include commitments regarding time frames within which the client can expect a response to its emails, standards dealing with how legal advice will be provided and the approach that the department will take in providing advice. A good CSS document can also include what commitments the legal department can expect from its client and, as a best practice, is reviewed, approved and signed off by the client business partner(s).
• Shared objectives: Where every department is required to set its own departmental objectives (which may have an impact on merit compensation) and where the legal department will play a key role in that client reaching its own objective, I recommend that the legal department make it a point to share the same objective(s) as the business partner.
• Have a chat with your business partners: In setting strategic objectives and in undertaking strategic planning initiatives, it is critical to consult with your business partners to see how they feel additional value can be added by the legal department. This will help identify potential areas of opportunity to grow and strengthen the relationship. At the very least, the discussion is also an opportunity to get a different perspective that can assist in improving how the legal department operates and approaches its client.
• Go beyond the numbers: I often hear it said: “Go with what you had last year” or “If you cut an expense, it is gone forever, so better overestimate.” This kind of thinking misses the value associated with coming to the table with a potential cost saving. In my view, it is better to be realistic with budgetary assumptions and then, if necessary, add a line to cover any unforeseen costs or litigation matters. This move will help you gain credibility with your business partners and direct reports.
• Conduct a SWOT analysis: SWOT stands for identifying the strengths, weaknesses, opportunities and threats with regard to your legal team and the functioning of the legal department. Using these findings, it is possible to then develop the strategies that will fill the gaps and minimize the risks. This analysis should be conducted annually and, once the strategy is implemented, the process should end with a new SWOT analysis to see what further strategies may be required.
• Look for opportunities to make a big impact: There are numerous technology solutions in the marketplace that, regardless of the departmental budget, can — in a very cost-effective manner — introduce big improvements in productivity. One such example is the implementation of a contract management solution. While there are some solutions available that use existing software to provide basic contract management capabilities, managing contracts and litigation matters is a critical function or responsibility of most legal departments. You may want to develop a strategic plan to investigate and add such a process improvement.
For those in large departments, you are very likely already doing more than the above, but for small and medium legal departments, the strategies should not impose great constraints on your scarce resources, but the value derived from implementing these strategies is well worth the effort. For further information on how to set about strategic planning, there are many informative articles out there to assist you, such as this one. These strategies will also give the legal department a stronger voice and greater credibility at the boardroom table.
I am not unmindful that the amount of strategic planning and objective setting that an in-house department can do is often limited by factors such as the size of the legal department, time constraints, the different workplace cultures (which may have different views as to the role of legal) and, ultimately, the levels of autonomy that the department has in setting its own strategic plans and objectives. That being said, I think that the following points represent some good strategies that all in-house should consider implementing to add value and become increasingly strategic:
• Every legal department should have “client service standards”: This document lists commitments that will guide the legal department in servicing its client. It can include commitments regarding time frames within which the client can expect a response to its emails, standards dealing with how legal advice will be provided and the approach that the department will take in providing advice. A good CSS document can also include what commitments the legal department can expect from its client and, as a best practice, is reviewed, approved and signed off by the client business partner(s).
• Shared objectives: Where every department is required to set its own departmental objectives (which may have an impact on merit compensation) and where the legal department will play a key role in that client reaching its own objective, I recommend that the legal department make it a point to share the same objective(s) as the business partner.
• Have a chat with your business partners: In setting strategic objectives and in undertaking strategic planning initiatives, it is critical to consult with your business partners to see how they feel additional value can be added by the legal department. This will help identify potential areas of opportunity to grow and strengthen the relationship. At the very least, the discussion is also an opportunity to get a different perspective that can assist in improving how the legal department operates and approaches its client.
• Go beyond the numbers: I often hear it said: “Go with what you had last year” or “If you cut an expense, it is gone forever, so better overestimate.” This kind of thinking misses the value associated with coming to the table with a potential cost saving. In my view, it is better to be realistic with budgetary assumptions and then, if necessary, add a line to cover any unforeseen costs or litigation matters. This move will help you gain credibility with your business partners and direct reports.
• Conduct a SWOT analysis: SWOT stands for identifying the strengths, weaknesses, opportunities and threats with regard to your legal team and the functioning of the legal department. Using these findings, it is possible to then develop the strategies that will fill the gaps and minimize the risks. This analysis should be conducted annually and, once the strategy is implemented, the process should end with a new SWOT analysis to see what further strategies may be required.
• Look for opportunities to make a big impact: There are numerous technology solutions in the marketplace that, regardless of the departmental budget, can — in a very cost-effective manner — introduce big improvements in productivity. One such example is the implementation of a contract management solution. While there are some solutions available that use existing software to provide basic contract management capabilities, managing contracts and litigation matters is a critical function or responsibility of most legal departments. You may want to develop a strategic plan to investigate and add such a process improvement.
For those in large departments, you are very likely already doing more than the above, but for small and medium legal departments, the strategies should not impose great constraints on your scarce resources, but the value derived from implementing these strategies is well worth the effort. For further information on how to set about strategic planning, there are many informative articles out there to assist you, such as this one. These strategies will also give the legal department a stronger voice and greater credibility at the boardroom table.
