Digital disruption and the challenge of building tomorrow’s legal function
As legal environments get ever more complex, law departments are coming under relentless pressure to reduce costs. However, right now, with many just trying to keep the lights on, most are focussed on meeting day-to-day demand without the time to think about operating more effectively.
Most law departments have found it challenging to tackle costs strategically, instead choosing a tactical approach to meet savings targets quickly. Often, cuts have been made where it has been ‘easiest’, rather than where they were most needed and many have failed to look more deeply at the underlying issues with the delivery model.
Solving this problem requires a laser focus on the right business and strategic priorities, underpinned by a high-performing, scalable and cost-effective delivery model.
Transformation requires a holistic approach
There’s no "one size fits all" approach to legal department transformation but, working alongside their CEOs and CFOs, today’s GCs are looking towards cost-based transformation of their function by harnessing enterprise change programmes and focussing on the right level of business partnering, improving how the function operates, introducing legal technology and leveraging outsourced legal services, in addition to targeted use of outside counsel. Deployment of specific solutions for key costs areas, such as contract review, preparation and execution, and legal automation, remains vital in delivering this transformation.
Rolling out transformation requires careful consideration
Transformation isn’t just implementing new technologies; it involves major changes in how the function operates and how people work together and embrace this change. Because of this, the sequencing needs careful consideration and a reimagining of the entire journey, which can be hard after years of incremental improvements.
Only once the vision and direction are agreed can organisations build the processes and technology to support it and this is where legal functions should look to harness transformation initiatives that are taking place across the broader enterprise. Leveraging these programmes can help align with board ambitions, new business objectives and wider organisational investments to help the legal department put in place a more effective operating model and improved capabilities.
Outsourced legal services and contract review solutions
As legal teams revisit operating models, and focus on business advisory rather than documenting simple transactions or other execution-level tasks, new service models are being explored to deliver these activities more effectively.
Outsourced legal services (OLS) enable in-house teams to quickly and cost-effectively extend and enhance capability and capacity in relation to execution type tasks by leveraging the optimised resourcing model of a mature provider. Internal resources can then concentrate on higher-value, strategic matters where they can provide the greatest value to their organisation.
Alongside OLS, in-house teams can employ outsourced contract review and remediation solutions for cost-effective, large-scale, technology-enabled contract digitisation, review and remediation support programmes.
Incorporating LegalTech efficiently
Technology continues to be one of the biggest disruptors in the legal sector - and one that the global health crises has accelerated. While it’s clear the most successful legal teams of the future will leverage technology, selecting the right tools in a market that’s crowded by a huge range of vendors and solutions is difficult.
And digital transformation is much more than platforms, AI, and data. The key isn’t just introducing and using technology, but developing new skills, capturing legal insights, leveraging the efficiencies and changing mindsets to maximise return on investment.
Act now to overcome current disruption and drive future change
The legal industry has long faced pressure to modernise. To best help their organisations adapt to change, legal teams need to evolve.
Those that do it successfully will reap the rewards of better-managed capacity, increased efficiency and, ultimately, more significant cost savings. They’ll also be best positioned to add value to the business as a strategic partner and advisor, enabling and contributing to the future growth and success of the organisation.
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