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The case for transformation

08 March 2022

Craig Chaplin explores how data and insight leads to change by informing better decision making and business cases for investment.

The global legal market has changed profoundly over the last decade as the necessity for change continues to be prevalent. There is a clear and growing desire for legal services to be delivered in a simpler and more efficient way.

In a sense the challenges in-house teams face are no different from last year but where 12 months ago there was insufficient bandwidth and budget, this year the teams that have survived the COVID-19 legal "tidal wave" are now getting ready to do something about making things better. 

Despite in-house legal budgets getting trimmed we are also seeing a willingness in real estate focused businesses to invest in legal operations and legal tech with the approval of a "transformation budget" for the right business case. New legal market disruptors and ALSPs have shown the way to an extent and legal operational efficiency is increasingly becoming a "thing". Despite shrinking legal budgets increasing salary expectations means that there is an escalating cost to serve and the diversifying and aggressive regulatory backdrop indicates that the work that needs to get done to simply keep companies on the straight and narrow is also on the up. 

As a final challenge GC's and heads of legal are now being asked for more insight into what their teams are doing. No longer "independent" or in ivory towers the legal team is simply seen as another business function that needs to "do its bit" and demonstrate its value. This showing of worth is particularly difficult to do in an environment where limited data has been collected historically.  If done right data and insight is definitely the fuel which will lead to change by informing better decision making and business cases for investment (e.g. into legal technology). 

Lean and mean

Last year we predicted that COVID-19 would be the catalyst for change and transformation and now the eye of the storm has hopefully been weathered, new plans and budgets are being readied. The biggest aspiration we hear from GC's is that they want to free up their team's time to undertake strategic and complex work which they are best placed to deal with due to the fact that no one knows their organization better than them. This makes total sense. The best way to do this is by redesigning business processes to enable self-serve or by outsourcing low value, low risk work to an ever increasing number of alternative legal service providers (ALSP's). Basic contracting and repapering exercises can be performed by a business set up and resourced to do just that at scale, with high levels of quality and at an appropriate price point. Not all legal solutions need to be dealt with by lawyers. 

Historically if you asked a GC about Lean Six Sigma they would give you a very strange look, particularly if you professed to be a "black belt" in the discipline! Now most team leaders want to understand how they can improve efficiencies by changing the way they do things. They are happy to invest time and money process mapping current and future states of a function with a view to optimizing the services which flow through them. This is especially so in the contracting world when they realize the level of efficiency gains possible by standardizing and simplifying contracts (and reducing negotiation time by both making contracts reasonable and not feeling the need to win every argument their teams are invited to). Imagine giving your team 60-75% of their time back to focus on the important things and being proactive. 

Technology tools for asset management

The biggest upsurge in interest that our legal operations consultants are seeing is an increased openness to the idea that technology will be able to help reduce time on routine tasks (or even automate them entirely). The realization that this is possible now on a moderate scale with the possibility of very advanced capabilities in the next three to seven years again should motivate legal budget holders to act sooner rather than later. Previously too many lead heads deferred making technology investment decisions because they were waiting for a perfect solution, rather than embarking on a journey of learning, tweaking and making mistakes. It's an investment journey and there is no right time either now or in the future to procure a 100% perfect technology (it doesn’t exist) so progressive learning is the key. The rapid technological response to COVID-19 may unleash a new wave of optimism surrounding the value technology can bring. Newly opened minds are already driving a technology orientated delivery demand particularly with asset management in mind. 

Data is the new gold

Everything is increasingly about data these days and businesses understand that data is information and information is power. Historically legal teams have been surrounded by data but really starved of insight and now there is a realization that those who can unlock the information available and use it strategically will achieve demonstrably better things. Why "demonstrably"? Because the data will show this! 

In a similar way to GC's who struggle to navigate the increasingly bewildering world of Contract Lifecycle and Asset Management (100 platforms and counting!), many also have yet to get going on their data journey. If you know where to look for good "data" (hint – start with all the information your legal panel holds in respect of your matters) and understand what story you are trying to tell then that is half the battle. That said you can collect and analyze all the qualitative data in the world but you have to interrogate and distrust it and use your own judgement to validate what it is telling you. Fortunately there are lots of legally focused data analysts now employed by legal businesses to help you on this journey. They understand the end-to-end process from collecting information to using it in a visual way to inform decision making. You must enlist their help. If you do not know how to ask the right question then even if you have data by the skip load, you will discover very little. 

Do or do not – there is no try

In summary, COVID-19 has taught people to be braver, more decisive and to not worry about making mistakes. In-house teams are learning how to articulate what they need and to demonstrate to their businesses the benefits of providing it. With the right investment into dealing with the "BAU churn" work carried out by in-house teams will become more strategic, complex and interesting with job satisfaction and attrition rates improving favorably as a result. Legal teams can optimize support through, process efficiencies, technology tools and outsourced services and they can use data to show the aggregate benefits of their transformation journey.

Legal service provision is now a multi-disciplinary team game and the successful teams will collaborate with their business functions and service providers to supercharge the value in what they do.

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