The Corporate Law Function Needs Disciplined Management & Usually Does Not Get It

October 28, 2022

Corporate Legal’s Latest Approach to Cost Containment: Same Old / Same Old

by Joel A. Webber

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The Point

1. For decades, corporate Legal has offered two responses to spiraling costs:

(1) “Bring more work in-house” — substitute less expensive, generalist lawyers as full-time employees to whom you pay salary & benefits, for more expensive, specialist law firm attorneys who you pay by the hour, and

(2) Slow-walk adoption of technology-enabled systems to do routine and recurring legal work cheaper, quicker, and more accurately — and instead double-down on use of lawyers to do such work manually.

2. Corporate Legal’s latest response to spiraling costs (as reported this past Monday, October 24, 2022, by the Association of Corporate Counsel, the leading global organization of in-house lawyers, in their State of Corporate Litigation Today Survey Report for 2022):

(1) “Bring more work in-house” — this was the leading cost containment method cited this past Monday, coming in at nearly 60% in the survey, and

(2) Slow-walk adoption of technology-enabled systems — this was reported dead last this past Monday among cost containment methods, with technology coming in at a mere 12%. Continue reading

October 20, 2022

Attorneys Are Good at Law, But Bad at Efficiency: So Have a Proven Manager — Not General Counsel — Run Legal’s Budget, Personnel & Operations

by Joel A. Webber

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The Point

1. The corporate law function costs too much and takes too long.

2. Most corporate law functions knowingly accept material amounts of waste in two major forms:

(1) Rather than fixed fees agreed between lawyer and client in advance of the work, most pay outside lawyers by the hour, and

(2) Rather than engaging alternative legal services providers (ALSPs) to implement process-based, technology-enabled systems to do routine and recurring legal work cheaper, quicker, and more accurately, they largely avoid ALSPs, and use lawyers in firms or in-house for such work instead.

3. Most general counsel’s backgrounds are confined to the practiced of law; they lack “management” experience as that term is understood elsewhere in the business.

4. It makes no more sense to insist that only lawyers can run the budgets, people, and operations of the corporate law function, than it does to say that only a physician is qualified to serve as CEO of a hospital system. Continue reading

April 21, 2022

If Only One Employee Knows of Something that Poses Early-Stage Legal / Regulatory Danger, Can Your Business Prevent a Full-Blown Catastrophe?

by Joel A. Webber

The Point

“It’s the front-line people who know what’s going on, not the people with their feet up on the desks in their offices”. So writes Alan Weiss, the clearest thinker on professional services delivery I’ve ever met.

Yet, in the context of critical enterprise risk management, the odds are against one employee’s knowledge of incipient legal or regulatory danger coming to the attention of someone positioned to effectively nip that danger in the bud. Unless that one employee is either relatively senior, or visits with one of the company’s lawyers by happenstance.

This Matters to Your Business

With the early-stage legal and regulatory dangers that mutated into the Boeing 737 Max crashes, the General Motors ignition switch tragedy, and the Blue Bell Creamery listeria outbreaks, it was, as Alan Weiss would have put it, “the front-line people” who knew about those hazards well before any customer died. It was not the corporate law function (see post). Continue reading