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“It’s a transformational time for us – we’re literally creating a new profession,” says David. “The job we do as in-house counsel has always been very different from what happens in private practice, but the difference is now growing wider than ever before.”
To characterize the difference in a nutshell – for in-house counsel, the emphasis is no longer simply on delivering traditional reactive, siloed legal advice. Instead, it’s about becoming a proactive strategic partner who is deeply embedded in the business.
David says the speed and complexity of this shift is testing both traditional law firms and the business world alike. Law firms are finding it difficult to grasp how this new dynamic will impact their working relationship with in-house teams, while many businesses still view their own in-house legal functions as a cost center and struggle to appreciate the value they offer beyond the confines of black letter advice.
“I was recently involved with a large corporation whose view was that the purpose of their legal function was to spot and mitigate risk – full stop,” recalls David. “This, unfortunately, led to the belief that the fastest way to get a ‘no’ was to go to legal.” This type of implacable mindset, which buys into the idea of lawyers purely as siloed academics who sit in an ivory tower, is detrimental to the success of the business as a whole.
Yet, despite the entrenched thinking in some quarters, change is occurring. As the fourth generation of in-house counsel gives way to the fifth, the result is a shift away from siloed and reactive approaches to work. Or, as David puts it, the, “I’m too busy, I don’t have time – let’s throw more lawyers at the problem” attitude.
“It’s been my mission to get businesses, especially the COOs, CEOs, CFOs, and boards of directors and investors, to understand that if you’re running your legal function in a modern way, with modern management principles, technology and a great ops function, it’s super-valuable to the business. By being proactive – having a scalable engine room, embracing things such as an enterprise legal management system and AI, being innovative and focusing on excellence, we can accelerate the legal function. In fact, due to our wide and deep connections to the business, we can accelerate the entire business.”
He stresses that being a pure legal advisor is no longer enough for today’s in-house counsel. It’s also essential to be a decision-maker – someone who can say, “the business should do this” or, even better, “we’re doing this – and I understand the business well enough to make this call.”
He also makes the point that if legal teams want to stick their head above the parapet, they better be prepared – and have the data, metrics and business cases to successfully engage with the scrutiny that will follow. Some business leaders are still grappling with the notion that their legal functions can and should be much more than just risk spotters and mitigators, and the stereotypical attitude – that the legal function is an entity separate from the organization, and a cost center – continues to prevail. Certainly, without data to prove their worth – which technology can deliver – the “cost of the in-house legal department” will continue to be a deeply misunderstood topic.
“Without data to prove our worth, the cost – and value – of in-house legal will continue to be deeply misunderstood.”
David has heard it all before, especially from consultants who are brought in to evaluate business expenditure: “They say the way to save money in legal is to stop them being involved in business partnership work. Stop talking to the business, stop going to the meetings, stop building trust. Just do the legal work – stay in your lane. Don’t listen to those guys – they are usually finance consultants and they will tell you how to save money the old-fashioned way. It’s time for a more enlightened approach.”
He also offers good advice. “From a tactical perspective, my approach has always been to do your own benchmarking. Prepare for when they come – because they will. And when they do, be ready to say: “We’re a modern and effective in-house legal function, we’re scaling and we’re driving this business. What you’re telling us is old school. Oh, and here’s a report we’ve prepared to show the impact of our work.”
A modern in-house legal function should embrace the fact that businesses operate under a very different model to that of private practice law firms. The key to success is to focus on efficiency, working smarter not harder, and on building two-way understanding and visibility between legal and the rest of the business.
David says that while implementing technology is advisable, it’s not essential – at least during the early stages of modernizing your ways of working. However, technology platforms can be incredibly useful for optimizing efficiency – as well as creating that much-needed visibility into what legal does. “We’re at a tipping point technology-wise – there are now platforms available that are comprehensive and allow you to speed things up and shine a light on your team’s value in real time without adding a lot of extra administrative overhead.
“By reducing the low and mid-level routine work through things like contract template automation, AI, and enterprise legal management, you can accelerate the business. This allows you to focus your efforts on the higher-complexity work which is most valuable to the business strategically.
“In-house legal teams have got a lot of work to do to bring our functions into the modern age. But if we get it right, we’ll be doing something very different from what has happened in the past. We’re using new technologies to usher in a different way of working which allows us to become strategic operators in our business. It’s a really exciting time to be creating a new profession. We’re not what we were five years ago, and we’re certainly not what we were ten years ago. These days, we’re not just lawyers – we’re business leaders with legal skills.”
By taking a proactive stance and shifting towards a more integrated, strategic approach to legal work, in-house counsel can have a visible and tangible impact, becoming indispensable assets to their organizations in the process.
