A couple of weeks ago at a meeting of the Chicago Legal Innovation & Technology Meetup, Alma Asay, the founder of Allegory Law, offered a primer on encouraging lawyers to adopt technology. During her presentation, she said something very interesting: that many people she speaks with at law firms are unaware of changes to legal operations being made by their corporate clients. (Specifically, that they are taking great strides to streamline, automate and reorganize the delivery of legal services).
Her observation confirmed a hunch I made while at the annual Corporate Legal Operations Consortium conference in May. During one of the daily opening sessions, a speaker asked those from law firms to raise their hands. Needless to say, of the hundreds in attendance at the session, attendees from law firms was a very small minority.
Why should outside counsel care about internal changes to corporate legal operations? Well, let’s start with their wallets. A recent survey of in-house counsel concluded that 75% of all legal work is kept in house, and many plan on bringing even more legal work in house.
Also, as corporate legal departments streamline their own processes, they are going to expect outside counsel to streamline too.
In-House Counsel Is Keeping an Eye on You
Asay notes that “many lawyers at law firms don’t realize the changes that are afoot inside corporations.” She notes that an outgrowth of modern legal operations is more process and more technology which also means more insight into the activities of outside counsel.
“Where it used to be one or two corporations that were ahead of the curve and stricter on outside counsel, now the legal operations teams across corporations are banding together and sharing information, so they can all implement the same standards.”
Asay agreed that law firms were not well represented at the CLOC institute this year. “CLOC membership reads like a ‘who’s who’ of the corporations that any law firm could hope to represent, and the 2017 CLOC Institute was chock full with in-house counsel and legal operations professionals sharing ideas and examples of how to both bring more work in-house and exercise more oversight over outside counsel. Yet, almost none of the law firm lawyers with whom I’ve met since then have any idea that CLOC even exists.”
Disaggregation of Legal Work
Dan Linna, an attorney and law professor at Michigan State Law School notes that corporate legal departments are disaggregating legal matters and looking for better ways to get legal work done–with or without law firms.
“In some instances they are ‘making’ what they need, including by having attorneys do the work in house. But they are also improving legal processes by employing process improvement disciplines like lean thinking and applying project management.”
Linna points out that in-house legal departments are also automating tasks with technology, from document assembly, expert systems, and process automation tools to artificial intelligence. But, he also notes that many corporate legal departments are not reaching out to law firms to support them in these endeavors.
As a result, Linna says, law firms should discuss the client’s improvements to their legal operations to learn how they as a law firm may use a “people, process, data, and technology” approach to improve legal-service law firm service delivery efficiency, quality, and outcomes. (To those ends, Linna recently launched the Legal Services Innovation Index, a study and pilot project to create an index of legal-service delivery innovation. In the first phase, the index will catalog of law firm innovations and a law firm innovation index.)
“If law firms are not having these discussions with their clients, they should assume that their clients are having these discussions with other law firms, legal technology companies, and alternative legal service providers.”
New Role for In-House Counsel: Legal Process Consultant
Oscar Romero, Percipient’s Director of Corporate Legal Operations Technology and formerly in-house at Bridgestone Americas, notes that corporate law departments are under pressure from other departments (finance, operations, HR, etc) to reduce costs, streamline functions and deliver better work product.
“It’s not just about cutting costs, it’s about improving work product and delivering it at lightning speed. The days of in-house sitting in their office buried in work are over. In-house counsel are going to take on more of a legal consultant role, who engages early on in the planning stages with business colleagues. This will mean more and greater alignment with not only business leaders and management, but also outside counsel to help steer the direction and success of their companies.”
So, where should outside counsel start to learn more about developments in legal ops? A good start is regular communication with clients about legal department initiatives and departmental changes. Independent from client communications, the CLOC website is a great start. Also, books by Dr. George Beaton and blogs like 3 Geeks and a Law Blog are helpful because they feature in-depth coverage of changes and innovations in legal service delivery.