operating like a small town

This article was originally published in Legaltech News.

The bystander effect, one of the most empirically-validated effects in social psychology, occurs when the presence of bystanders causes individuals to ignore a situation they could have helped. Think ten Olympic swimmers each passively watching somebody drown and telling themselves it isn’t their job to do anything because one of the other nine will.

Morbid, but illustrative.

High-performing legal teams work together to advance their organizations. It is incumbent upon each individual on these teams to manage their own responsibilities and manage them well. However, it is less likely those individuals will do their part if law department leadership does not do its part to create an environment of accountability where the bystander effect is minimized.

Take your departmental outside counsel budget, for instance. In order to hit budget, the cost of most ongoing legal matters is going to have to be reasonable. Furthermore, if costs escalate in one area, the rest of the department will have to adjust accordingly. Yet this is exactly the opposite of what happens in environments lacking transparency and accountability. That pattern is:

  • Many legal matters lack budgets altogether, even when they are “required.”
  • Dysfunctional or non-existent reporting means nobody knows the extent of the problem.
  • The GC and practice group leaders do not hold direct reports accountable, either because they don’t know about the above issues or because they naively believe people will police themselves.
  • Nobody tracks budget violations or budget revisions.
  • The few in-house counsel who do police budgets well get no recognition.
  • Budgets are routinely exceeded with no consequences for vendors or for the in-house counsel who let it happen.
  • The rest of the department is unable to pivot to compensate for poor budget performance occurring in a particular practice area because they don’t know about it, and it is “not their job” to clean up somebody else’s mess.
  • There is no single “budget czar” whose head rolls when things go wrong, so nobody takes responsibility or even acknowledges these deep, systemic issues.

The Small Town Corporate Law Department

In a small town, everyone knows everyone’s business. While this might sound negative, knowing where everyone stands can be highly beneficial for law departments.

I believe organizations should strive for a legal department equivalent of Mayberry, where there is transparency into the quality of administration at all levels. In this environment, metrics keep everyone in check. They blast away at anonymity and focus good peer pressure in just the right places. Nobody wants to let down their team.

The one exception where you might want anonymity is where people are truly struggling. There is no reason to embarrass them by letting the whole world know. It might be best to keep their lagging performance between their manager and you—reach out to them on a personal level to see what they need to get better.

The Town Crier

When sharing these metrics with team members, it’s important to remember that the more impersonal the communication, the less effective it will be. For instance, managers should refrain from issuing standard email blasts. They are easily ignored and perpetuate the zero accountability atmosphere that needs to be dispelled.

Instead, managers should opt for more accountable distribution channels. All-hands meetings offer the perfect chance for team members to discuss team performance metrics and trends. Other settings, including practice group meetings, meetings with internal corporate clients and legal project managers, and quarterly business reviews with law firms can also be good venues for honest discussion and accountability. And managers should never underestimate the effectiveness of spontaneously picking up the phone or knocking on somebody’s door.

Friendly Competition

Beyond in-person interactions, there are other creative ways to share metrics. Some law departments have set up LCD monitors that keep running tabs of key metrics. These can be placed near water coolers, in kitchens, or other places where people congregate. Teams can also embed metrics in workflows where they are most likely to inform decision-making, such as matter opening and closing, invoice approval, timekeeper rate approval, and more.

Competition is also a motivator. High-performing recipients can be rewarded for their efforts through bonuses, sports or concert tickets, and the like. Perks like these can draw attention to the fact that quality administration matters to the GC and is not just an afterthought.

In law, accountability is everything. Clients hold firms accountable on a daily basis and should hold themselves to the same standard. Treating the legal function as if it were a small town, where everyone knows everything, is a great way to uphold accountability and responsibility and turn bystanders into active participants.

About The Author

Nathan Cemenska

Nathan Cemenska, JD/MBA, is the Director of Legal Operations and Industry Insights at Wolters Kluwer's ELM Solutions. He previously worked in management consultancy helping GCs improve law department performance and has prior experience as a legal operations business analyst.

In past lives, Nathan owned and operated a small law firm and wrote two books about election law. He holds degrees from Northwestern University, Ohio State University, and Cleveland State University.