Our last issue discussed transforming the law department in order to align it with the corporate vision. This issue focuses on a critical aspect of that transformation – prioritizing the department’s work.
Ideally, the law department should give the highest priority to legal work that is most aligned with the company’s vision. Many departments, however, do not have a clear understanding of the relative value of their work and how that value compares to the department’s actual efforts. First, therefore, the department must assess, and even quantify, the relative value of the work it performs. Then, it can evaluate the amount of time and effort being put into each of those types of work and identify gaps between effort and value. This exercise provides the department with the information it needs to develop a plan to reconcile those gaps.
Values and priorities
It is important to get client input to the value assessment as well the department view, as there can sometimes be surprising differences between what the department thinks its clients want or need and the clients’ actual wish list. We suggest assigning each type of legal work a value – higher, medium, or lower – based on three primary criteria:
- Risk Potential: the extent to which the type of work has potential to negatively impact the company/matter
- Alignment with Strategic Direction: the degree to which the type of work supports the company’s corporate strategy and will drive or sustain the company’s competitive advantage
- Complexity: the relative legal and business expertise required to address the need, including resources and time
So, for example, a law department in a company whose strategic direction included new product development would probably determine that certain intellectual property work is of higher value. The same organization would define routine employment questions as relatively low value because they do not contribute to the company’s strategic direction and have minimal risk if they are routine, non-escalated inquiries. “Bet the company” litigation or litigation with high precedential impact is of higher value, while more routine litigation might be considered of medium value. You can use a similar approach to assess the value of each type of work that falls under the department’s responsibility.
Current workload allocation
Once you have determined the value of the various types of work, assess how law department team members actually spend their time. One way to discover this information is to conduct a workload survey.
Many departments find that their use of resources is not necessarily aligned with the newly defined priorities. Department members often prioritize their work based on when a request is received, who makes the request, or historical precedent, rather than on the work’s actual value to the organization. For example, team members may spend an inordinate amount of time responding to routine requests that may not actually require ongoing legal input, such as employee separation meetings or low value form contracts.
The matrix below illustrates the above-described framework for value prioritization and suggests how those priorities should guide who does the work, with higher value work getting the most attention from internal law department resources. Gaps between this matrix and the law department’s reality indicate potential areas for reallocating work. If a proportionately high number of law department team members are performing lower value work, for example, there may be opportunities to eliminate, automate, or outsource that work.
Putting the information to work
Conducting the assessment is the first, and perhaps the most important, step in the law department’s transformation. The information gained from these exercises – prioritizing specific types of work and then comparing the department’s work allocation to those priorities – is the foundation for the changes that need to occur. Challenge the team to look for efficiencies by revamping roles and processes such that the right level and type of resources are performing the work in alignment with its value. This may require changes in the department’s organization, changes in its relationship with other departments, changes in how the department delivers its services, or a different array of external resources. But it is only with a clear understanding of the true priorities that the department can be confident that moving forward with these changes will truly align it with the corporate vision.