Having a connected legal function is more necessity than nicety. During turbulent times - think global pandemic or potential recession - the response of some in-house legal teams has been to hunker down and conserve resources. Others are embracing the opportunity provided to grow and adopt a connected way of working.
Shaun Plant, LawVu's Chief Legal Evangelist, is the pioneer behind LawVu's new framework for in-house legal teams, called the 'Connected Legal Function'. He believes that if an in-house team invests time and resources into becoming more connected, the legal team and the wider business will both benefit greatly.
What is a Connected Legal Function? Put simply, it is delivering in-house legal services in a way that is designed to maximize the productivity and efficiency of the team and its impact on the business while simultaneously being able to tangibly demonstrate its value.
The approach comprises four key pillars: productivity, engagement, proactive and impactful. Focusing on these pillars allows the team to become more connected to their work and team, the wider business, and business outcomes as a positive consequence. "Focusing on connected legal allows legal teams to grow, and in times like the recession you don't want to think how can I survive, but how can I thrive?" says Plant.
There's a lot of talk about an impending global recession. A Federal Reserve gauge indicates the US economy could be headed for a second consecutive quarter of negative growth, ticking the box for a recession. The Financial Times notes stock markets are taking a turn for the worst, with a sell-off in inflation-protected bonds, bonds, gold, industrial metals, and crypto. The World Bank expects global growth to slump from 5.7 percent in 2021 to 2.9 percent in 2022.
While it's not all doom and gloom until it actually happens, Plant advises legal leaders and their teams to start preparing for what could be tough times ahead for business. "Preparation does not mean squirreling all your nuts away to survive winter," he says. "Rather, it's an opportunity to re-think and optimize your team. It's a burning platform that teams can use to drive the change they want but haven't been able to prioritize."
Plant references the 2008 Global Financial Crisis when legal teams found themselves inundated with work as the cost of external counsel became unjustifiable. "If we face another recession, in-house counsel should be looking to the past and realize they will soon have much more work to do as things are brought back in-house. Not only will the volume of work increase, but the type of work will be different and more complex. Increasing headcount won't be an option."
Preparing for an influx of work means getting the right tools and processes in place. Investing in tech might seem like the last thing a legal team would do in a recession, but it will best set them up to weather the additional work and collect data to provide insights on the legal department's value.
Covid-19 also proved this to Plant: clients found themselves either grateful they had invested in legal tech before dealing with the challenges of the pandemic or kicking themselves for not getting on board sooner. "Use the time now to prepare for the recession should it happen," says Plant.
Unfortunately, some businesses view the legal function as a cost center. "You know what happens to cost centers in a recession? They thin us out," warns Plant. This is why it is crucial for a legal team to demonstrate the value that they add and that they are a critical component of the business' success. "Continuing to churn through work won't cut it. Legal teams need to be smart about what they spend their time on. The goal must be to maximize productivity and efficiency, ensuring the right processes, tools and behaviors are in place to produce good quality work with the least possible resources."
The Connected Legal Function framework was created after interviewing in-house legal professionals worldwide, finding that the profession needed a way to deal with the increased complexity and volume of work they were facing and then connect back with the business.
The framework starts by automating low-level tasks, allowing legal teams to be more productive and efficient. This gives counsel back time to focus on the strategic work that is valuable to business objectives. Plant notes the type of work that lands on the desks of legal teams is likely to change during a recession. "Right now, there are a lot of mergers and acquisitions and growth in business. We know from the GFC that that type of work will reduce, and litigation will skyrocket."
However, a difference to the previous GFC is that we are in a different digital space, the increase of data in daily business interactions has been astronomical, which means litigation cases will involve massive volumes of information that will need to be trawled through. "If you're using different and unconnected technology systems, the cost and effort to work through that volume of data will be huge. You will need something more sophisticated than Ctrl+F. Having a connected technology stack which provides a single source of truth is a critical component of an effective legal function through those processes."
Prioritizing being connected allows legal teams to have the most impact or, as the Executive Leadership Team might see it, to deliver value to the business.