By Richard G. Stock
This is the forty-second in a series of articles about how corporate and government law departments can improve their performance and add measurable value to their organizations.
Legal teams do not have strategic plans of their own. Still, the priorities of a legal team should align with the directional focus provided by the company. In addition, normally, business unit objectives and priorities should drive the law department’s annual business plan. The law department resources can then be aligned with each element of a company’s strategic plan.
Law department initiatives and action steps cascading from corporate strategic and business unit objectives can be mapped to a “balanced scorecard” methodology. Yet many law departments seldom document formal and comprehensive alignment or positioning for legal services. This means a legal team is not as effective as it can be. A law department should explicitly and closely align its objectives and each lawyer’s with corporate strategic goals and business unit plans. These can form part of the business plan for the law department spanning up to three years.
My experience advising law departments on workloads and workflows, resource allocation, and performance management challenges suggests that a clear statement of roles and responsibilities can benefit a law department. This kind of “manifesto” is intended to establish the priorities for change, service delivery, and resource management. It can be related to the company’s declared corporate priorities and guide the behaviour of the legal services team.
Most law departments have an implied service goal and an enabling role in providing legal services, including risk management, comparable to what can be obtained from a law firm. This can be done at a lower cost while fully complying with professional standards and ethics. There can be no criticizing such a goal and role. But they are minimalist and should be assumed by all company stakeholders, and such a formulation suggests no relationship to a company’s strategic business priorities.
Some years ago, an Altman Weil survey reported that CEOs ranked three law department activities as the most valuable: supporting business objectives, advising company leaders, and managing legal risk. Law departments can be regarded as value-added contributors to a company’s strategic priorities, business unit plans, and corporate strategic plan outcomes. To this can be added a set of performance targets and metrics for law departments focussing on a results-oriented contribution.
I recommend law departments adopt a formal statement of roles and responsibilities – effectively the manifesto – to better anchor its developmental and resource management priorities. The components include the mission, the strategic focus, operating principles, and a clear set of priorities. The manifesto can then be presented to and formally accepted by the corporate leadership team. Here is a sample manifesto.
Mission of the law department
We will provide the company with quality, cost-effective and accessible legal services for all facets of its operations across the organization to “Get Business Done.”
The elements within the corporate strategic plan to which our law department will add measurable value across the next three years are based on the company’s three strategic priorities:
Excellence in the customer’s experience
Excellence in operational efficiency
Excellence in talent management
Without limiting essential regular work, our law department commits significant resources to each focus area to serve as a value-added contributor. Most of the initiatives of our law department’s business plan are then based on business unit plans.
Our operating principles suggest the importance that we place on leadership and relationship management for each member of the law department:
Building deeper, more productive relationships with business units, enabling corporate growth and development.
Leadership in managing commercial contracting for the organization.
Leadership in the resolution of disputes with employees and suppliers
To serve as a stimulus for innovation and results in the quest by our board, by the corporate executive team, and by business units to respond to corporate objectives by - improving productivity and business unit engagement - guaranteeing timely, results-oriented services to all users of the law department - leading and demonstrating effectiveness in service delivery
To serve as the company’s anchor for best practices in contracting.
To ensure that, by March 31st, 2024, 75 percent of the objectives and the initiatives of each lawyer and staff member reflect specific business unit plans.
To ensure that law department members exceed the proficiency level required for at least 80 percent of the competencies (attributes, skills, and knowledge) required for their positions.
To re-structure the law department’s relationships with business units using relationship lawyers, service level agreements, and standards so that our objectives can be achieved and measured for quality and economic success.
To serve as a centre of expertise in legal services for the company’s commercial interests and in the company’s relations with its employees.
To ensure that the law department effectively and efficiently contributes to risk management and dispute resolution by December 31, 2024.
Initiatives, targets, and accountability are developed for each of the seven priorities. CLOs and GCs can generate momentum and results with a manifesto for the law department.
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