LR NEWS 1898 DAILY

Third half: the way forward for authorized transactions

Our third and final installment in the maturity model series deals with the future of legal transactions. In our first post, we introduced the concept of the maturity model and defined the five different operational levels that legal departments can reach when they strive to meet the needs of their organizations. The second article discussed departmental initiatives based on the maturity model and the tools critical to each of these initiatives.

Now we’re going to dig deep into the evolution of the industry and what legal professionals are doing to keep track of things.

Decisions are based on data, not intuition

Gone are the days of advice and a qualitative approach to legal operations. The future is data.

Legal departments now have the technology to ingest large amounts of data so they can speak quantitatively about their department and measure productivity using lenses such as total legal costs, costs by subject or area of ​​activity, internal or external expenses, and more. Part of this quantitative approach is to proactively suggest business process improvements, including using legal technology to align and integrate with core business processes to ensure closer collaboration with other key departments such as finance.

The most important piece of information for legal operations is a line-by-line analysis of where your department is spending money. You want to be able to demonstrate that every dollar has a traceable return on investment, whether by reducing key risks to the business or actually increasing revenue through contract management.

With this data, legal departments now have the opportunity to break away from traditional stereotypes and lead in areas that were previously out of reach for the legal team. A good example of this is one of our customers, a medical device company. As we entered the current stage of economic uncertainty, their leadership team urged them to cut spending. The Legal Operations team was able to rely on technology to provide insight into spending for the next few months and enable them to immediately view outstanding claims, decide which reports to run, review the billing universe required, and decide what data should be shared and with whom.

Processes do not have to be initiated

The future of legal transactions already takes place in operationally mature legal departments, as these have sophisticated systems. Predefined processes for defined activities take place every day without the need for human input.

For example, consider hiring outside legal counsel, a task that spurs many companies to adopt software solutions for legal operations. In a mature department, the company has likely already published a request for quotation (RFP) and identified a handful of companies that they only work with. Why this? As with all processes, the setting is repeatable and consistent, which can be tracked and measured. As a legal department grows and matures, the CFO is often asked to contain costs and possibly meet procurement requirements. This process will only run smoothly if the department already has the right tools and reports in place.

For one of our most operationally mature clients, the Legal Operations software enabled Legal Ops to develop a convergence panel for the selection of external lawyers. The ultimate goal was to have all the data in one panel and show what types of businesses were needed and what regions they have. The company created the panel as part of the RFP process. Now the bulk of his legal work is assigned and used daily to determine which companies the department should hire. All the data lawyers and paralegals need can be easily accessed in the legal software so they can make data-driven decisions and ensure consistency in hiring.

Unravel complex management systems for better data

Proper technology management is required to ensure the platform’s rollout while building a networked stack of legal technologies that will benefit the entire legal department. In the near future, technology management will be a top priority for legal professionals.

E-billing and expense management software are essential tools for today’s legal department to meet growing pressures, reduce costs and work more efficiently. Implementing these tools is often the first step in creating a more data-driven department because they gather so much useful data for the business.

Too often, in-house legal operations teams are faced with onerous workarounds designed specifically from corporate finance software. For the medical device company mentioned above, the move to legal software after years of pulling various reports from an ERP’s financial system made it easier to get a grip on the company’s expenses. After switching, they never had to go back to the vendors to ask what they were being billed for for a particular matter. This saved a lot of time on tasks that previously burdened lawyers directly. This underscores one of the greatest advantages of mature legal business: attorneys can be attorneys while the Legal Ops team can work on projects that add value to the organization.

E-billing software is not the only technology that is revolutionizing legal processes. Secure file sharing is a valuable tool for legal departments as they process a significant number of documents – emails, contracts, invoices, memos, filings, and more. Contract management solutions also help effectively manage the large volume of contracts that companies are processing today. Without a dedicated software solution, manually managing all contact conditions, renewals, and compliance policies across hundreds or thousands of contracts is inefficient at best and, at worst, can be incredibly costly and significantly increase risk.

Final thoughts

Whether you have a single team member spending some of their time on legal operations or a full department with multiple dedicated staff on legal operations, the basic facts are the same. All over the continuum, legal operations thrive when the right tools are in place.

When these tools are used effectively, the legal department can take advantage of the lessons learned. Efficiency gains are achieved, there is clear visibility into data, and lawyers can be assured that administrative tasks are being performed so they can focus on the critical task of actually acting as lawyers.

When systems are in place to run the legal business and decision-makers have the data they need to make their decisions, lawyers can finally exercise the law and legal practitioners can focus on value-adding projects. This is what mature legal transactions look like.

Comments are closed.