About a 100 corporate legal professionals participated in a panel discussion that centered on maturing legal operations at the annual 2015 annual LexisNexis CounselLink customer conference.
In some ways, listening to the session was like being a fly on the wall as attendees and panelists discussed objectives and programs unique to respective industries, including financial services, communications and biotechnology.
Here are three anecdotes from the discussion that provide snapshots or so to speak as to the ongoing endeavor to move up the corporate legal maturity model.
1. Inside-Outside: Battling the Deluge Together
“Our basic objective is to survive throughout the year,” said a senior vice president of legal operations support for a financial institution. The organization employs hundreds of attorneys in-house. Banks face a dynamic deluge of legal challenges which are usually both large and complex. Top priorities include reducing risk, driving down costs and looking for ways to use data to drive better legal outcomes.
“We have increased efficiency in which our outside firms are able to settle matters,” he said. “We expect our firms to collaborate together and we want to increase the amount of fixed fees we have.”
2. Walking Away From “It Costs What it Costs.”
The number one priority is to protect the company, according to the legal operations manager at a communications company however it’s beginning to examine whether or not value it receives from their legal vendors aligns with the cost. For example, the legal department is beginning to analyze how many depositions the company really needs and is closely scrutinizing rate increases.
“If the reason for the increase is that a six year associate has been promoted to a seven year associate, then that is no longer a valid reason for a rate increase,” he said.
The organization has experienced an evolution from crawl to walk as inside counsel has layered a mentality of “it costs what it costs” with a more thoughtful and data-driven analysis of value. The company doesn’t have a formal vendor management program in place, but it’s working toward that goal. First, we were just crawling, but now we are at a place where we are walking,” he said.
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3. Formalizing Billing Guidelines
A biopharmaceutical company is just getting started with vendor management according to the legal operations manager. The firm has put formal billing guidelines into place, is developing creative AFAs and says the department is better at aligning legal vendors with corporate legal objectives. It’s “a start” she said and indicated the long term goal is to harness the department’s own legal spend data to negotiate with outside legal vendors, she added.
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As Kris Satkunas wrote for InsideCounsel – Corporate legal maturity: Demonstrating value with data –
There is not a right or wrong place to be along the maturity curve. The legal department with the least maturity, accented by manual processes, little automation, and absent of analytics, has the greatest potential for gaining efficiency. The more mature legal departments also have substantial gains to be earned in predictive results through scenario modeling, data-driven forecasts and win-win pricing. The end goal is to move the legal department ahead in the maturity cycle.
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Photo credit: Flickr, Adam Selwood (CC BY 2.0)