Successfully managing corporate legal resources requires precise strategic evaluation. Definitively understanding where you are now is the first step in establishing your desired future state. Establishing clear strategies for leveraging external resources is critical in optimizing your operational support across the legal function.
Internal & External Legal Resources Strategy
A company’s legal team and resources are vital to managing and mitigating risk making strategic management of this area a necessity. Developing a strategy begins with analyzing your current state, which includes evaluating legal spend, budget, in-house versus external resource allocation, and risk tolerance. Once the current state and any gaps are identified, documenting the goals, needs, and expectations lays the foundation for the implementation of a strategic plan. Performing a SWOT analysis of the legal team is a key component of this process.
Leveraging external resources, such as outside counsel and other subject matter experts, can provide your legal team with substantive expertise unavailable internally and supports high-volume, high-risk matters needing additional expertise. This allows your in-house talent to be strategic drivers by managing high-impact legal matters. Strong relationships between internal legal departments and external experts can significantly enhance legal cost reduction and efficiency, ultimately contributing to the organization’s overall success. Value-driven legal support includes strategic alignment with external counsel, experts, and technology that results in a deep understanding of the company’s risk tolerance, corporate culture, and goals.
Identifying a person from the internal legal team to lead external resources is an important factor in your strategy. The process includes identifying elements of your current workload that can be outsourced to free up internal resources.
Metrics, Collaboration, & Technology
According to the Thomson Reuters Institute, corporate law departments’ use of legal success metrics increased from 75% in 2015 to 90% in 2023. However, these metrics must go beyond core legal spend to include work volume, successes, matter cycle time, regulatory penalties and fines, settlements, recovered monies, and the ability to predict outcomes. Feedback programs are also material and can be conducted using surveys, polls, formal interviews, casual conversations, etc. Establishing, maintaining, and sharing some or all metrics facilitates effectiveness and boosts your perceived value and strategic importance.
Fostering a collaborative mindset within the legal ecosystem encourages external counsel to view themselves as an extension of the in-house team, which helps create a sense of shared responsibility and commitment to the organization’s success. Clear communications and expectations are foundational to successful relationships and high-value work. Regular training and knowledge sharing with external partners ensure the external team remains aligned with current industry trends and organizational objectives.
While the use of legal technology is on the rise, the rate at which technology is evolving requires constant due diligence. As noted by Richard Tromans, a distinguished legal tech consultant, “the industry has yet to witness a true tech transformation. This is largely because many businesses, despite adopting new software tools, have still to tap their full potential due to insufficient staff training and business practices that hinder industry-wide transformation. Therefore, it is essential to align your business model with technology that can significantly increase the production and delivery speed of billable work.”
Summary
Creating a strong legal operations strategy requires the attention of leadership and your entire legal team. Simplifying objectives is recommended to ensure clarity on what is critical. Circumventing a lack of direction involves comprehending what, why, and how you do things, as well as what benefit it delivers. Inflexibility enhances risk and is not an option as new legal challenges will continue to evolve. Prioritizing legal operations and risk management strategies, investing in people and technology, streamlining processes, investing in training and development, and using metrics to measure success should be top priorities for every organization.
