Managing Legal
Last week — when I read that its General Counsel Jeffrey Carr was calling the shots for the law function in targeting 50% savings in Univar’s legal spend — I took notice.
I believe that the single most important success factor in the ElevateNext / Elevate Services / Univar collaboration is that the client’s law function is being led by a business guy — not someone whose perspective is confined to practicing law.
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I write Part III of this series from a strong personal viewpoint. My comments here are based on observations over the years about how companies are well served — or badly served — by their lawyers.
Besides reading what’s in the media and press releases, I have no special knowledge about this particular venture (though I have met and spoken with some of the participants in the past — long before this announcement was made).
Following my own experiences as a practicing lawyer and later as an executive (see more here), I’ve concluded that attorneys are good at deploying technical legal expertise, but that they are unskilled in managing people, poor at cost control, and are either uninterested or undisciplined about proactive liability prevention.
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This was not always my view. As a practicing lawyer I never questioned the way that lawyers in law firms and in-house conduct companies’ legal affairs.
Then I accepted a corporate client’s invitation to run one of its divisions.
Only after moving from the lawyer side of the lawyer / client table to the client side did I recognize that prevailing law firm and in-house counsel offerings contain prejudgments about pricing, work flow, and assignment of people to tasks that no general manager would tolerate anywhere else in business.
And only after completely changing roles this way did I conclude that 40% or more of conventional in-house budgets and law firm fees consist of avoidable costs.
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The individual calling the shots for the client in this collaboration — Univar — is a business guy.
Earlier in his career Jeffrey Carr was an executive — not in a law role — running an international business with his colleagues. Unlike virtually all other chief legal officers and in-house lawyers I’ve met or am aware of — Carr’s background is not confined to being a lawyer.
To be sure, Carr has the bona fides of prestige in the legal profession: Georgetown Law, clerkship with a prominent federal judge upon graduation, and practice with an elite Washington, D.C. law firm thereafter.
But I believe that his record at FMC Technologies — reducing total legal budget (outside counsel fees plus in-house spending) from $14.3 million annually in 2003 down to $9.5 million in 2013 while FMC Technologies’ revenues grew 4X — reflects his P&L skills as much as his legal erudition.
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Carr has expressed his business guy bona fides in an “I’m-not-a-lawyer” riff speaking to other lawyers (See video here):
“I’m not a lawyer … I’m a racecar driver“: Where he contends that as law function leader he — like a racecar driver — is really a project manager. He needs to focus on directing a team. He believes that bad things will happen if he relies on himself as a solo performer. And he contends that his real value is in managing an execution model consisting of policies, relationships, and projects.
“I’m not a lawyer … I’m an operator“: Specifically, as law function leader Carr argues that he is operating the processes of that function. He’s not a solo performing one task after another — or a micromanager of other lawyers’ work.
“I’m not a lawyer … I’m a lifeguard”: As law function leader his job is prevention. He says: “The best legal problem is one you never have“.
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As a practicing lawyer I knew how to try a case, write a contract, or convince a regulator that my client was on the right side of the rules.
Nothing wrong with those capabilities. They’re necessary to a company’s legal needs.
But as a business guy I learned that those needs are a lot broader than what most practicing lawyers comprehend. I learned that management of a company’s legal affairs is just that. It’s a management job — not just a lawyer job.
I’m betting on this collaboration because Jeffrey Carr — the one acting for the client here — has been living this outlook for years.