General counsel & senior in-house lawyers roundtable: driving value in legal procurement

Following our second General Counsel roundtable discussion, we outline the key themes that emerged from a very insightful conversation

Date: 28 March 2019
Location: The Ivy, Birmingham
Participants:

  • Simon Colvin – Partner, Weightmans
  • Tracy Lake - Partner, Weightmans
  • Mo Ajaz - Global Head of Legal Operational Excellence, National Grid and founder of LEx360

As well as delegates from Bibby Distribution Limited, Cadent Gas Limited, Severn Trent Water Limited and South East Water Limited.

Key takeaways

  • General Counsel (GCs) or Heads of Legal face a difficult balancing act, ensuring their businesses are not taking excessive legal risks, while avoiding being perceived as business blockers. GCs are no longer just lawyers, they are key business partners providing pragmatic value adding, risk-based advice on a huge range of compliance-based topics.
  • Providing tools and training to empower non-legal employees to work more autonomously can free up legal teams to focus on higher value work. It takes time and certain skills to implement such programmes. In-house lawyers should make use of value added service offerings from their legal partners to fill this gap.
  • Automation and other legal technology has the potential to transform the way in-house teams operate, but implementation is in its infancy for many. Automation will have a role, but in-house lawyers must ensure that the appropriate platforms are purchased and the correct agreements are automated.
  • Value-based fee arrangements with law firms rather than fixed hourly rates can deliver value, but sophistication and mature thinking is needed on both sides. True value arrangements tend to be used where there are strong relationships between a GC and a law firm as there will always be an element of trust.

Access to the right legal advice is critical for anyone who owns or manages a business, whether they’re a leader in a large enterprise with its own legal department or running an SME and working solely with external advisors.

But sourcing this advice in a way that delivers maximum value can be a challenge. Where should the responsibilities for different types of work lie, how much of it should be outsourced to law firms, and to what extent can automation help alleviate the load?

Clearly there is no “one size fits all” solution to any of these questions.

So, to address this complex and broad topic, we recently held a roundtable discussion, under Chatham House rule, to canvass the views of in-house General Counsel (GCs) and legal consultants.

The role of the in-house lawyer

It seems that for many in-house advisors, a key challenge is ensuring compliance and minimising legal risk within a company while not being perceived as the person that always says ‘no’.

The role was described by one attendee as “treading a line between a trusted team member and a gatekeeper”.

There was agreement that understanding the real risks faced by the business and ensuring operations and strategy are in line is a central responsibility. However, lawyers should also aim to use their understanding to help executives find creative solutions and new ways of working, in order to be viewed as an enabler, rather than a blocker, of business development.

There was also broad agreement that, as disruption increases in almost every sector of the economy, and big businesses increasingly need to adapt the way they work, the role of the GC will only grow more important in supporting these strategic changes.

Doing more with less?

In-house legal teams are frequently challenged to do this, but clearly there are limits. For many teams, the real goal is simply to do enough with the budget available.

Finding ways of reducing the workload of overburdened in-house advisors is a priority, and empowering people within the business to make their own decisions is key.

While this process is not without its challenges – changing working cultures can take time as well as a lot of work to put the right tools, checklists, training and standard terms in place – the benefits can be significant.

Legal technology

The potential for technology to support in-house legal professionals by automating processes was another hot topic during the discussion.

Already, sophisticated artificial intelligence-based solutions are being used by law firms to increase efficiency for high-volume, lower-value work, and in-house legal teams are looking to take inspiration from this – albeit for many as an aspiration for the future.

Smarter outsourcing

The approach to working with law firms played a key part in the discussion, and evolving fee arrangements away from traditional hourly-rate models was a hot topic.

Some are choosing to implement points-based systems that look to align billing with the value of outputs to ensure resources are focused on the most important areas.

However, there was acknowledgement that traditional ways of working are often deeply rooted both in clients and law firms, and that changing this culture will be a long journey, requiring equal levels of maturity and sophistication on both sides.

I’d like to take this opportunity to thank all of the attendees for their contributions to what was a fascinating and insightful discussion on an urgent topic.

Our next roundtable will focus on “Technology and Innovation” and will take place on the 27th June in Manchester. If you are interested in attending, or would like further information regarding our event programme for General Counsel and Senior In-House Lawyers, please visit our General Counsel initiative webpage.

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