In mid-October, The Economist presented an informative event in London for General Counsel (GCs), Chief Legal Officers, and other leaders of in-house corporate legal departments, entitled General Counsel 2015: Creating Value in a Disruptive World.
Because the event was held under the Chatham House rule, I can’t quote specific comments from individuals. Nevertheless, I’m eager to share my reflections on the overall themes that emerged from the day’s sessions and conversations.
Breaking Down Silos
Information, skillsets, and operations at many large corporations are structured into disparate silos that, at best, make it difficult for internal teams to work effectively and, at worst, can leave companies vulnerable to compliance breaches. This is a significant concern for a number of the event’s participants.
In some cases, silos might be jurisdictional. International supply chains and a worldwide customer base mean that globalisation is something that GCs must adapt to. When serving a global company, a legal department has responsibility for overseeing legal matters throughout the world, which sometimes requires coordinated efforts in multiple countries. But in the experience of the conference attendees, it is not uncommon for cross-jurisdictional knowledge to be lacking and for a legal department to be left simply hoping that they have done all of the necessary work to keep their company protected.
In other situations, silos may result from separate departments, such as Legal and IT, not consulting each other. Cyber fraud, for example, is a major concern for IT, but companies need to remember that the legal department should work in concert with IT to take responsibility for mitigating the likelihood of incidents and responding if they occur.
Collaboration is the lynchpin to avoiding these pitfalls. Policies must be put in place to require communication amongst stakeholders with the right expertise. And these should be supported by technology solutions that make it easy for collaborating teams to access to key data, regardless of their department or their geographic location.
For a GC to have an accurate view of the company requires visibility across departments and countries. This starts by first having a confident view of the legal department, which can be difficult with counsel in multiple locations. An Enterprise Legal Management system allows for quick reporting on high-risk matters, risk exposure, and legal spend, as well as enforcing standardisation of legal work across the business by consolidating and automating legal, risk, compliance and law firm processes.
One GC at the conference decided to make a change that increased internal visibility in an unusual way. He gave up control over the legal budget, moving it into the hands of the Finance department. After this shift, legal spending decisions became more objective and transparent because the GC now had to make a clear case to Finance for any budget expenditure. This is a task which can be made easier by implementing spend management technology that captures historical spending and supports analysis of ROI.
The first step in communicating value is capturing it. While some of the legal department’s contributions, such as good legal advice, are intangible and difficult to quantify, GCs should measure any value that they can. An Enterprise Legal Management system that tracks work and productivity levels, captures billing data, and generates reports on accomplishments allows a GC to quantify the contributions their team makes and share the department’s value with leadership.
It also helps to increase that value by providing concrete data on which a GC can base important decisions. For example, the GC can use combined data from matter and spend management to discern historical trends and determine what to outsource and what to keep in-house for the best results. This quality-orientated approach moves GCs away from concentrating on “doing more with less”, instead adding value and becoming business leaders.
This recap barely scratches the surface of a terrific event offered by The Economist. Thank you to them for giving legal department leaders the chance the share their challenges with each other and with those of us who serve them. And thank you to all of the attendees; your open participation and candid contributions allow us to help you achieve your goals.
To learn more about our Passport Enterprise Legal Management solutions, please visit our Passport Platform page.