Alignment with the business. Key to the success of the in-house legal department is
alignment with the interests and goals of the client. To ensure alignment, savvy general counsel
will review the enterprise strategic plan to identify priorities that may require or drive legal
services. The next step is plotting legal services on a “value matrix” (considering risk and
competitive advantage) and sitting down with business leaders to discuss their needs and how
the legal department will meet them. Proactive agreement upon which legal services to invest
in (or not), as well as service standards, yields alignment.
Legal project management. Put simply, deliberate planning, budgeting, communication
and review yield sound management of legal matters. Start by “scoping” the matter —
articulating the goals and being clear about what’s in and what’s out (i.e. what does not have to
be done), then establish the parameters within which the work will be accomplished — the
schedule, people and budget. Once launched, regular meetings and reports ensure the project
stays on track, and improvement in future projects comes with conducting quick reviews upon
completion of each matter.
Value-based fees. Any fees that are not primarily based on hours worked are value-based
fees. Value to clients is often a matter of achieving predictable spending, so fixed fees are
valuable. There are many variations, but the key is alignment of incentives — when outside
counsel are specifically incented not to work as many hours “as it takes,” but rather to focus on
efficient delivery of legal services, and on the clearly articulated outcome that the client wants,
value is achieved.
Process improvement. There are several disciplines borrowed or adapted from the
manufacturing context to improve legal work processes — Six Sigma, Lean, etc. They can be
useful, but the point is simply to eliminate waste, such as extra steps; streamline processes to be
more efficient; and, most important, to relentlessly address root causes — not just of mistakes
or inefficiencies, but also of legal work itself. Prevention of disputes is the most potent way to
control legal expenses.
Knowledge management. This is the process of capturing, distributing and effectively using
knowledge. In its most evolved state, there is an integrated approach to identifying, capturing,
evaluating, retrieving and sharing all of an enterprise’s information assets. These assets may
include databases, documents, policies, procedures and “know-how” in individuals.
Technology. In the value context, legal teams leverage technology to automate processes that
lawyers should not be doing, or to make those processes more efficient. Another important
application of technology is to capture and provide data to assist in decision-making and to
assess progress against goals — even to predict outcomes.