KEY TAKEAWAYS
- Legal departments face budget cuts and downsizing, yet are expected to accomplish more work and deliver more value
- By creating transparency, which we define as what work is being done, why the work is being done, and how the work is being done, we can ensure greater efficiency in the legal department
- Establishing formal processes and minimizing standardized work allows for legal professionals to become more productive
- Transparency is obtained through detailed analysis by a team of internal resources and external professionals
- Transparency allows for more efficiency in the legal department, and encourages the shift from legal as a function of the business to legal as a business which delivers value to the organization
Optimizing the legal department with transparency
In recent years, there has been a shift in what is expected of Legal departments. It is no longer enough for Legal to simply deliver on requests; today, it is necessary for Legal to create and deliver value for their organization. This shift of the Legal Department from a business function (which delivers on requests) to a business (which delivers value) is a result of several factors, one of which is the increasing demand of the organization to spend less money. Budget cuts and downsizing which traditionally target areas such as Technology and HR now include Legal, as well.
Despite these cost constraints, there are more responsibilities being imposed upon the department. Legal today is explicitly relied upon for strategic planning and business advice and is expected to weigh in on decisions made by almost every department across the organization. There are no extra work hours in the day, so how is it possible to accomplish more work with fewer dollars and less staff?
The solution is to be more effective and more efficient, and to ensure that existing practices genuinely deliver value. To accomplish this, the Legal department must first become transparent – the business must understand what Legal is doing, why Legal is doing it, and how this work is done. Once this transparency is obtained, there must be a strategic evolution in how the Legal Department operates to create transparency in not just Legal’s current state, but the department’s future state, as well.
Creating Efficiency Through Transparency
Legal has historically been a black box – an entity which is not clearly visible or understood from the outside (more on this in a following article). This means of operation is no longer sustainable. To improve upon efficiency and productivity, the department must be fully understood. Legal’s operations, processes, and knowledge management (means of creating, sharing, using, and organizing information) must be transparent. This means that for everything the department does, we must understand why they’re doing it, how they’re doing it, and how it supports the business’s overarching mandate. Only once the existing systems are clear can we begin analyzing and improving upon those systems.
When we look at the existing systems cohesively, we can begin to implement tools and processes to increase efficiency. Templates and playbooks can be developed to enforce standardized approaches to varying situations. Processes can be automated; data and document storage can be formalized. Establishing these protocols results in fewer decisions to be made and fewer discussions to be had. Streamlining knowledge management allows for the Legal Department to do its work without getting bogged down in the process.
Of course, there is no one-size-fits-all solution to amending your legal operations. Every organization functions differently and must have solutions developed to suit their individual needs. But for all organizations, the first step is to obtain this efficiency is through transparency.
Streamlining Operations to Increase Productivity
By addressing the processes and knowledge management systems within the Legal department, we can allocate the right work to the right people so that everyone is making the best use of their time. Establishing templates, playbooks, and automated processes (discussed above) removes operational work from lawyers, which allows them to spend their time on the legal work itself. Their responsibilities during each stage of the process become clear, saving both time and money for the organization.
Having established formal processes also ensures that outlier issues and net-new projects will be more manageable. The operational work becomes a question of modifying an existing template or process, rather than establishing and developing a whole new system. Project costs become easier to estimate, timelines become more reliable, and legal review becomes more predictable.
By revealing the existing system and evolving it into an effective and transparent one, legal professionals become more efficient and more productive; their time is spent doing the legal work, rather than deciphering how and when to do it.
Obtaining Internal Transparency through External Resources
The process of unveiling the Legal department’s operations should not be left to lawyers; their training is in different areas, and their time is better left to legal work. Similarly, legal employees might have a good understanding of how the existing systems work, but they might not be in the best position to uncover all the connections, perhaps due to office politics, or perceived conflicts of interest. It is human nature to become emotionally attached, and the perspective of internal people will always contain some form of bias. External resources will not have this personal connection to the organization and will be able to bring a removed perspective to the team.
External resources take a detached, holistic view of the organization, which can be difficult to achieve from the internal perspective. There must be a level of detachment to ask the right questions, and to be sure that all areas are adequately investigated. Internal teams are prone to looking too intensely into factors which do not require a deep dive, and can feel pressured to not ask questions around certain areas (for example, they might feel they are expected to already know the answers). External resources have implicit permission to ask these ‘dumb questions’, because it is understood that they have to learn everything. To do the job right, external consultants must form a partnership with internal employees; their job is not to provide answers, but to ask the right questions so that the team can find the answers together.
Transparency Allows for Efficiency
Transparent Legal Operations allow for Legal Departments to be more efficient with fewer dollars, and to minimize their operational work. These systems are designed to save time and effort, to increase the effectiveness of legal professionals, and to enable legal professionals to ask the relevant questions at the ideal time. Effectively, Legal departments can accomplish more with less.
Because of this revelation in the Legal Department, more integration with the business, surrounding departments, and clients became possible. This inevitably led to further evolutions in legal operations, contributing to the shift from Legal as business function to Legal as a business.
Improved operational efficiency created the opportunity for Legal to do more than just deliver on what is asked of them; it enabled them to start providing value to their organization. Today, this perspective of Legal as a business is no longer a potential by-product of change. It is the goal, and achieving this goal begins with transparency.
Thank you for reading, and stay tuned for our next article! Until then, be sure to check out our Blog for more Legal Operations discussions.