Managing Legal
Part III
For routine, repetitive, or high-volume legal or regulatory compliance tasks, ask yourself which service provider brings the the right business processes — and perhaps the right technology — to the need presented.
…
Some of your company’s legal and regulatory needs call for a team and a process.
Not for a particular attorney.
And certainly not for an attorney who happens to be under-utilized or to have only partial aptitude for the task.
…
Unlike general management, the legal industry doesn’t usually break down routine, repetitive, or high-volume tasks according to Six Sigma, the Toyota Production System, etc.
As a friend put it when we were both first year associates in a prestigious Wall Street law firm: “We’re in a cottage industry!”
He didn’t mean that our work was small beer. After all — each lawsuit and transaction had lots of zeros after the dollar sign.
Instead my friend meant that lawyers at our firm were essentially individual artisans, sitting at work benches making shoes by hand, etc. sitting at our desks, proof-reading trust indentures, researching case law, etc.
Most tasks handled by large law firms, by small law firms, and by in-house legal departments are made-to-order. Lawyers’ work is usually marked by intellectual rigor in the thinking behind it — but not by management rigor in its execution.
…
Hence some guidelines for general management in securing legal services where routine, repetitive, or high-volume work is involved:
1. Since law firms and in-house departments work on a made-to-order basis — realize that they’re unlikely to perform your routine, repetitive, or high-volume work by the sort of rigorous business processes you’ve seen elsewhere in the company.
One lawyer recently described well what I’ve seen consistently. Law firms who are:
“… Compelled to sell not only a fuller spectrum of their capabilities at the maximum price that might otherwise be unnecessary, but also to use under-utilized lawyers rather than involving the right people for the right job at the right price.”
Ditto for in-house departments assigning generic company lawyers to tasks to which they are only partially suited. Witness the Fortune 500 general counsel with whom I was in a meeting a few months ago who referred to his in-house legal staff as “utility infielders”.
2. The last decade has seen new offerings that take tasks traditionally performed ad hoc by law firms or in-house departments to bring (1) specialized competencies, (2) economies of scale, and (3) usually — technology.
For instance:
- Ernst & Young’s artificial intelligence-powered review of hundreds of leases to ascertain conformity and need for adjustment in light of new IRS regulations.
- Axiom’s Contracts Intelligence Platform to automate via machine learning due diligence reviews in M&A deals.
- Outsourcing of business functions and processes associated with regulatory compliance to a Big 4 firm such as Deloitte.
3. Lawyers tend to view routine, repetitive, or high-volume work as akin to in-house support services — and so devalue them.
Peter Drucker put it this way in his classic “Sell the Mail Room” essay:
“The people running in-house support services are also unlikely to do the hard, innovative and often costly work that is required to make service work productive … Each task, each job, has to be analyzed and then reconfigured. Practically every tool has to be re-designed ….”
I have firsthand experience defending clients where a regulatory agency catches a low-level employee’s mistake or some minor miscue results in a lawsuit. That a legal or regulatory task is routine, repetitive, or high-volume does not mean that it’s so unimportant that an under-utilized law firm lawyer or in-house “utility infielder” will suffice to handle it.
…
See Part I (“Where there’s a lot at stake in the matter at hand it’s usually best to begin with “Who’s the right lawyer?” — Not: “What’s the best law firm?”) and Part III (“Match the attorney you pick to the decision-maker you face if a court, regulator, or prosecutor with a distinctive viewpoint will be driving the legal outcome”) — of this series.