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Legal Project Management and the Challenges of Transformation

April 2, 2019

Context – the initial adoption of Legal Project Management 

 

This year marks a decade since the term ‘legal project management’ first started to appear in 2009 – enabled by what Mark Cohen describes as a ‘perfect storm’ of economic, regulatory and technological elements that increased pressure on legal practices to deliver better value. [1] These pressures have not abated: ‘today, in the face of unprecedented financial and budget pressures, legal clients are demanding greater control, predictability, accountability, and responsiveness from their outside legal service providers’. [2] 

 

Broadly, project management results in more effective planning, cost control, resource allocation and appropriate risk management throughout the duration of a project, giving project team members the structured tools to make deliberate, fact-based decisions. [3]

 

Given these benefits, it is unsurprising that LPM is (at least according to US data) becoming an increasingly entrenched component of legal services delivery: [4]

 

  • Over half of the AmLaw 100 firms have professionals functioning as legal project managers

  • Over 50% of legal organisations have a budgeting or estimating tool for legal matters

  • Over 50% of legal organisations are requiring more detailed engagement letters or scope of work agreements at the start of new legal matters 

  • 40% of US firms engage in project management training, and 

  • 33.2% of US firms and 24.1% of chief legal officers are using LPM to increase the efficiency of their service delivery. 

 

However, implementing project management principles within a legal practice is an exercise in change management – and as with any industry, change inevitably presents challenges. [5] Jim Hassett, a well-known LPM thought leader, has colourfully noted that ‘in legal project management, figuring out what lawyers should change is easy. The hard part is getting them to do it’. [6] Notwithstanding their investment in developing LPM capabilities, few firms to-date have successfully embedded LPM so that it is an integral part of their client value proposition [7] – and as a result, the actual adoption of LPM practices has remained slow. 

 

Susan Lambreth, another LPM thought-leader, has recently observed that ‘even the law firms who are the US leaders of LPM have only been able to implement it on a small percentage of total firm matters (a very small number have started to reach 40%, while many others struggle to get 10% of matters or partners on board). Survey data shows that only 29% of US firms have structured project practices in place, and only 15% rate themselves as having a ‘high’ project management maturity level. [8] Similarly in Australia, a 2017 survey has reported that only 19% of surveyed law firms use project management software. [9] 

 

The difficulties experienced by legal practices in implementing LPM as much arise from the resistance of lawyers themselves to change, as from the inexperience of legal practices in properly managing change programs. 

 

Change Management – the theory

There is a substantive body of research in the area of change management, which is ‘the process of continually renewing an organisation’s direction, structure, and capabilities to serve the ever-changing needs of external and internal customers’. [10] Unfortunately, the literature in this area is anything but structured, with over 3,000 titles listed by Amazon under the official category of ‘organizational change’ [11], and a mosaic of competing change management methodologies. Newcomers to the field may find themselves unable to easily distinguish between competing models, such as Kanter’s Ten Commandments for Executing Change [12], 

 

Kotter’s Eight-Stage Process for Successful Organisational Transformation [13], and Luecke’s Seven Steps [14] –  indeed the area is sufficiently complex that theories even exist on how to classify different change management methodologies [15] 

 

Somewhat disconcertingly, the one area this research has reached broad consensus upon is that the majority of change management projects ‘fail’ – albeit that the definition of ‘fail’ varies significantly between researchers. This includes research undertaken by McKinsey & Company (2006) [16], IBM (2008) [17], and Kotter (1995) [18] – and which identified between 60 to 80 percent failure rates. Whilst some commentators have challenge these specific figures [19],  they do not challenge the consensus view that change programs are difficult to implement successfully. 

 

Nonetheless, the research still contends that change management is necessary to succeed in a competitive and continuously evolving environment; and furthermore that the pace of change has never been greater than ‘now’ (seemingly  irrespective of the date of publication) [20].  Organisational change cannot be separated from organisational strategy [21]:  some authors have quoted the axiom of ‘requisite variety’ from the field of cybernetics, in that an organisation’s internal processes must adapt at a rate no less than its external environment, in order to survive. [22]

 

It is only recently that LPM literature has also begun to reference aspects of change management, in direct response to the difficulty of adopting LPM practices. Legal practitioners are currently presented with an array of disparate guidance (with varying degrees of sophistication) on how best to implement LPM, but without a framework to assist in adapting and contextualising these approaches for each legal practice’s unique circumstances. Adding to this confusion, is the fact that (depending upon how expansively LPM is defined) LPM can include continuous improvement approaches such as lean six-sigma which are themselves examples of change management… in other words, these are change strategies to implement change management capabilities. 

 

For practitioners, the short summary is that no single change strategy or set of axioms will be relevant across an entire legal practice for all time. However, borrowing from Deming’s famous (and misattributed) proposition that ‘if you can’t measure it, you can’t manage it’,  [23] this leads to another question: how can we best select from and adapt the numerous change management approaches, to best fit the constantly evolving nature of legal practices? 

In this instance, the legal sector is the beneficiary of an existing substantive body of applied research into complex project management and the design and delivery of complex evolving systems, particularly from the defence sector. [24]

 

The Capability Acquisition and Sustainment Group (CASG) [25] (which is responsible for procurement on behalf of the Australian Defence Force) classifies all of its projects according to their level of ‘complexity’ [26] using the Acquisition Categorisation or ‘ACAT’ framework. [27] There are four categories in ACAT’s graduated scale: ‘the largest, most demanding and complex projects are categorised as ACAT I; less demanding and minor projects are categorised as ACAT II, ACAT III and ACAT IV. The ACAT level of a project is determined by assessing its complexity across the following domains: acquisition cost, project management complexity, schedule, technical difficulty, operations and support, and commercial.’ [28] The literature in this area largely agrees upon a common taxonomy of project complexity – ranging from simple, to complicated and then to complex. [29]

 

This contingency-based model around the concept of ‘complexity’ can also provide a useful framework for classifying different types of LPM change programs [30], as follows: 

 

  • Simple change programs: changing isolated legal processes (systems) in a manner that requires little (or no) change in lawyers’ identities, attitudes or behaviours;

  • Complicated change programs: delivering a group of integrated, simple change programs in a modular manner, where any resultant non-trivial impact upon lawyers’ identities, attitudes and behaviours is restricted to specific processes or groups; and

  • Complex change programs: changing multiple integrated legal processes that will have an enterprise-wide and non-trivial impact upon lawyers’ identities, attitudes and behaviours.

 

Practical applications of change management to deliver LPM 

Whilst there is broad consensus that the majority of change management projects ‘fail’, there is an equally vibrant discussion as to the underlying causes of this (as well as its counterpoint, namely the elements required for a change program’s success). [31]  This debate is also informed by similar discussions within project management which identify ‘change’ (in organisational priorities and project objectives) as the leading causes of project failure. [32]  Some commentators have argued that it is not change management strategy which is at fault, but rather the managerial capacity of those tasked with its implementation – and that change programs should be delivered using appropriately adapted project management approaches. [33]  
 

A. Simple Implementation 

Levy and Merry define ‘1st order changes’ as “minor improvements and adjustments that do not change the system’s core and occur as the system naturally grows and develops”. [34] The process of making incremental improvements to singular systems is covered in the literature by continuous improvement methodologies such as Deming’s plan-do-check-act cycle (or Shewhart cycle) [35], Total Quality Management [36] (where employees continuously improve their ability to provide on demand products and services that customers value), SixSigma [37] (which improves output quality by identifying and removing the causes of defects and minimising), and Lean [38] (derived from the Toyota Production System, and which removes ‘waste’ from processes). All of these approaches assume a high degree of stability in the underlying process or system (elsewise the benefits of incremental improvements would be undermined by system changes) – and which means that behaviour and performance of this process can be accurately modelled (and subsequently measured) using ‘hard systems thinking’ approaches such as systems analysis and systems dynamics. [39] 

 

Within legal practice, relevant examples of incremental improvements to singular systems would include workflow automations that reduce the time required to produce those parts of a legal process which lawyers perceive as being necessary but of low value – such as using document automation technology to develop a first draft document from a template; using an expert system to identify relevant legal information and/or triage (and even respond to) legal requests; and workflow automation that optimises routine administration.

 

Importantly, simple process changes largely reinforce (rather than challenge) lawyers’ traditional mindsets, since they still require lawyers to provide their esteemed legal input as subject matter experts, and they do not require lawyers to substantively change how they manage their legal work or interact with others. As such, simple process changes should have a relatively low risk of incurring resistance from lawyers, as well as lower technical implementation risks due to being singular (non-integrated) systems – these types of change program can be planned with a higher degree of certainty as to outcomes and timeframes. 

 

B. Complex Implementation

At the other end of the spectrum, Levy and Merry define ‘2nd order change’ as ‘multi-dimensional, multi-level, qualitative, discontinuous, radical organizational change involving a paradigmatic shift … 2nd order change is viewed as discontinuous, deep structural and cultural change.’ [40] This definition closely aligns with Dunphy and Stace’s concept of corporate transformation [41], and the process for implementing radical change is covered by authors such as Pascale [42] and Stebel [43] (who advocates for change through ‘breakpoints’). These approaches assume that underlying systems will adaptively change and behave in a non-linear manner – which requires more complex modelling approaches such as agent-based modelling, [44] as well as systems thinking models which ensure that conflicting or marginal stakeholders are involved in the process (such as Critical Systems Heuristics). 

 

Traditional project management strategies, tools and techniques are generally premised upon an assumption of certainty operating within a closed, static system – and as such are not appropriate for complex change programs: ’when certainty does not exist, traditional project management and systems engineering persist with the presumption of certainty, which inevitably leads to failure through the impact of uncertainty’. [45] 

 

Within legal practice, relevant examples of radical change to complex systems would include new deployments (or legacy platform migrations and integrations) of key operating systems such as the practice, finance or document management systems; firm-wide or office mergers; and the rapid scaling-up of alternative resource or technology solutions (including LPOs and artificial intelligence). Complex process changes such as these directly challenge lawyers’ traditional sense of discipline, trust and relevance, and represent substantively higher risk of incurring resistance from lawyers, as well as higher technical integration risks. 

 

C. Complicated Implementation 

Between these two positions are ‘modular transformations’ – namely, ‘organisational change which is characterised by major re-alignments of one or more departments / divisions. The process of radical change is focused on these subparts rather than on the organization as a whole’, including the ‘introduction of significantly new process technologies affecting key departments or divisions’. [46] The process of delivering change across multiple integrated systems is covered in the literature by areas such as systems engineering [47] as well as soft systems methodology [48], both of which provide approaches on how to identify and then integrate different systems and/or stakeholder objectives.

 

The difficulty faced in delivering complicated change programs is precisely that there is no clear boundary delimiting between simple, complicated and complex programs – there is a continuum which is highly context-specific to each organisation, and indeed to each lawyer involved. As such, whilst a legal practice may believe that it implementing a simple LPM change program with limited risk of internal resistance, an individual lawyer (or group of lawyers) may subjectively feel that their professional identifies and behaviours are being challenged – whether in relation to any one or combination of the areas of discipline, trust or relevance; and depending upon that individual’s or team’s role within that legal practice (such as a leading partner, or a team which takes the lead on specific types of legal work), they may be positioned to drive significant internal resistance to an LPM change program. 

 

Generally speaking, change through organisational processes is significantly easier to implement than organisational culture or value change: ‘in most organisational change efforts, it is much easier to draw on the strengths of the culture than to overcome the constraints by changing the culture’. [49] Noting this, legal practices implementing LPM should seek to reduce their delivery risk by minimising the extent of cultural change, whilst nonetheless seeking to optimise the amount of actual behavioural change achieved.  

Notes  

[1] Cohen, M.A. ‘The Reluctant Rise of Project Management in Law’ on LegalMosaic (24 March 2015) <http://legalmosaic.com/2015/03/24/reluctant-rise-project-management-law>.

[2] Woldow, P. and Richardson, D., ‘Adopting Legal Project Management: Why LPM Is Here to Stay and the Law Firm Manager’s Role in Its Evolution’ (2011) 30 Legal Management 33.

[3] Ritts, G., Shannon, J. and Hopkins, M., ‘Perfecting Project Management’ (2010) 28(10) ACC Docket 64 <http://www.acc.com/legalresources/resource.cfm?show=1215121>.

[4] Altman Weil, ‘2018 Law Firms in Transition Survey’ (2018) <http://www.altmanweil.com//dir_docs/resource/45F5B3DD-5889-4BA3-9D05-C8F86CDB8223_document.pdf>;

Altman Weil, 2017 Chief Legal Officer Survey: An Altman Weil Flash Survey (2017) <http://www.altmanweil.com/dir_docs/resource/BD1D63C3-3DD0-4FE4-BCAC-AD6F59CCC65A_document.pdf>; also refer to Lambreth, S. ‘RFPs/Surveys Show Clients are Demanding Legal Project Management’ (2013) LawVision 3 <https://static1.squarespace.com/static/511be8cae4b0c9b5341e6c9a/t/515aefafe4b0e6ea87e2101f/1364914095505/RFPs+and+Surveys+Show+Clients+Demanding+LPM+-+LVG+Newsletter+Article.pdf>.

[5] Ali, A.,  ‘Legal Aid: Big Law Firms Are Turning to Project Managers in Response to New Competitive Threats’ (2018) 32(1) PM Network 12.

[6] Hassett, J. (2013) Legal Project Management, Pricing, and Alternative Fee Arrangements, LegalBizDev.

[7] Widdop, A. ‘Legal Project Management and Its Role at the Heart of the Law Firm of the Future’ (2018) 2(1) Modern Legal Practice 33, 34.  

[8] Ali, note 5.

[9] Melbourne Law School and Thomson Reuters, ‘Australia: State of the Legal Market’ (Report, Thomson Reuters, 2017) <http://insight.thomsonreuters.com.au/resources/resource/state-of-the-australian-legal-market-2017>.

[10] Moran, J.W and Brightman, B.K.,  ‘Leading Organizational Change’ (2001) 6 Career Development International 111. The Association for Project Management also provides a similar definition of change management as ‘a structured approach to transition an organisation from its current state into a desired future state’: Association for Project Management, Change Management (2018) <https://www.apm.org.uk/body-of-knowledge/delivery/scope-management/change-management>. For an overview of the main theories of organisational change management, refer to By, R.T.,  ‘Organisational Change Management: A Critical Review’ (2005) 5 Journal of Change Management 369.

[11] This data is accurate as of 1st January 2019.

[12] Kanter, R. M., Stein, B. A. and Jick, T. D. (1992) The Challenge of Organizational Change New York: The Free Press

[13] Kotter, J. “Leading Change: Why Transformation Efforts Fail”, Harvard Business Review, March–April 1995: 1

[14] Luecke, R. (2003) Managing Change and Transition Boston, MA: Harvard Business School Press.

[15] By provides a useful literature review of this area, applying Senior’s (2002) framework to distinguish between change methodologies according to: the rate of change (ranging from discontinuous, to incremental and then continuous); the process of delivering change (whether planned, emergent, contingency-based or by choice); and the scale of change (including fine-tuning, incremental, modular and transformational). (all of which are ‘emergent’ approaches): By, R.T. (2005) ‘Organisational Change Management: A Critical Review’ Journal of Change Management Vol.5, No.4: 369-380.

[16] http://www.mckinsey.com/app_media/reports/financial_services/the_inconvenient_truth_about_change_management.pdf and also Isern, J. and Pung, C. “Organizing for successful change management: A McKinsey global survey”, The McKinsey Quarterly, June 2006.

[17] http://www-935.ibm.com/services/us/gbs/bus/pdf/gbe03100-usen-03-making-change-work.pdf

[18] Kotter, J. “Leading Change: Why Transformation Efforts Fail”, Harvard Business Review, March–April 1995, p 1

[19] http://www.enclaria.com/2014/06/03/its-time-to-abolish-the-70-change-failure-rate-statistic/

[20] Pascale, R.T. (1990) Managing on the Edge Simon & Schuster, Sydney; Dunphy, D. and Stace, D. (1990) Under New Management: Australian Organizations in Transition Philip Alexander, Sydney; Kotter, J. P. (1996) Leading Change Boston, MA: Harvard Business School Press; Senior, B. (2002) Organisational Change, 2nd edn (London: Prentice Hall); Balogun, J. and Hope Hailey, V. (2004) Exploring Strategic Change (2nd ed.) London: Prentice Hall.

[21] Rieley, J. B. and Clarkson, I. (2001) ‘The impact of change on performance’, Journal of Change Management 2(2):160-172.  

[22] For further discussion about cybernetics, refer to Jackson. M. (2003) Systems Thinking: Creative Holism for Managers John Wiley & Sons

[23] https://blog.deming.org/2015/08/myth-if-you-cant-measure-it-you-cant-manage-it/ 

[24] For an overview of complex project management, refer to the Australian Department of Defence, Complex Project Manager Competency Standards (2012) <https://iccpm.com/content/cpm-competency-standards>.

[25] http://www.defence.gov.au/casg/ 

[26] For a discussion on the definition of project ‘complexity’, refer to the Australian Department of Defence’s Complex Project Manager Competency Standards: https://iccpm.com/content/cpm-competency-standards 

[27] http://www.defence.gov.au/casg/Multimedia/CASG%20Business%20Framework.pdf The US Department of Defence also uses a similar framework: https://www.dau.mil/acquipedia/Pages/ArticleDetails.aspx?aid=a896cb8a-92ad-41f1-b85a-dd1cb4abdc82

[28] https://www.anao.gov.au/sites/g/files/net4981/f/2008%2009_audit_report_09.pdf

[29] Dombkins, D. (2007) Complex Project Management: Seminal Essays, BookSurge; see also Hass, K.B. (2009) Managing Complex Projects Management Concepts, Vienna; and Cooke-Davies, T. (2011) Aspects of Complexity: Managing Projects in a Complex World Project Management Institute, Pennsylvania

[30]For a broader discussion on the application of complexity science to law refer to Ruhl, J.B. and Katz, D.M. ‘Measuring, Monitoring, and Managing Legal Complexity’ (2015) 101 Iowa Law Review 191.  

[31] For a comprehensive literature review on the different causes of change program failure, refer to Mosadeghrad, A.M. and Ansarian, M. (2014) ‘Why do organisational change programmes fail?’, Int. J. Strategic Change Management, Vol. 5, No. 3, pp.189–218; see also Bernard Burnes (2011) Introduction: Why Does Change Fail, and What Can We Do About It?, Journal of Change Management, 11:4, 445-450.

[32] For example, refer to PMI Pulse of the Profession (2016): http://www.pmi.org/-/media/pmi/documents/public/pdf/learning/thought-leadership/pulse/pulse-of-the-profession-2016.pdf

[33] Refer to https://hbr.org/2013/04/change-management-needs-to-cha; see also Henry A Hornstein, ‘The integration of project management and organizational change management is now a necessity’ (2015) 33 International Journal of Project Management 291; and http://blog.prosci.com/the-correlation-between-change-management-and-project-success

[34] Levy, A. and Merry, U. (1986) Organizational Transformation: Approaches, Strategies, Theories Greenwood Publishing

[35] For a history of Deming’s Plan-Do-Check-Act model, refer to https://deming.org/uploads/paper/PDSA_History_Ron_Moen.pdf

[36] http://repositorio.upct.es/bitstream/handle/10317/441/tqm2.pdf?sequence=1&isAllowed=y 

[37]Harry, M. and Schroeder, R. (2000) Six Sigma: The Breakthrough Management Strategy Revolutionizing the World's Top Corporations Crown Business

[38] Krafcik, J.F., (1988). "Triumph of the lean production system". Sloan Management Review. 30 (1): 41–52.

[39] For a discussion about these approaches (and systems thinking more broadly), refer to Jackson. M. (2003), note 23. 

[40] Levy, A. and Merry, U., note 35. 

[41] Dunphy, D. and Stace, D. (1990) Under New Management: Australian Organizations in Transition Philip Alexander, Sydney at page 72: “Organizational change which is corporation-wide, characterized by radical shifts in business strategy, and revolutionary changes throughout the whole organization”, and which includes “Reorganization – major changes in structures, systems and procedures across the organization” as well as “Revised interaction patterns – new procedures, work flows, communication networks and decision-making patterns across the organization.”

[42] Pascale, R.T. (1990) Managing on the Edge Simon & Schuster, Sydney.

[43] Strebel, P. (1992) Breakpoints: How Managers Exploit Radical Business Change Harvard University Press, USA.

[44] Agent-based modelling has arisen from research into complex systems (Weisbuch G., (1991) Complex Systems Dynamics: An Introduction to Automata Networks, Addison-Wesley: Redwood City, CA.), complex adaptive systems (Kauffman S.A. (1993) The Origins of Order: Self-Organization and Selection in Evolution. Oxford University Press: Oxford, UK) and artificial life (Langton CG (1989). Artificial life. In: Langton CG (ed). Artificial Life: The Proceedings of an Interdisciplinary Workshop on the Synthesis and Simulation of Living Systems, Reading, MA, pp 1-47); refer to Bonabeau, Eric (2002). "Agent-based modeling: methods and techniques for simulating human systems". Proceedings of the National Academy of Sciences of the United States of America. 99 (3): 7280–7287.

[45] Dombkins, D. and Dombkins, P. (2008) Contracts for Complex Programs: A Renaissance of Process Booksurge Publishing, Charleston: at 16.

[46] Dunphy, D. and Stace, D. (1990), note 42 at page 72.

[47] Refer to INCOSE (2015) Systems Engineering Handbook (4th ed.)

[48] Checkland, P. (1981) Systems Thinking, Systems Practice John Wiley & Sons, Chichester.

[49] Schein, E. (2010) Organisational Culture and Leadership, John Wiley & Sons.

About the Author

Peter Dombkins founded and leads Gilbert + Tobin’s legal project management capabilities, and is a national leader in LPM. Peter is the first LPM to be accredited by the Australian Institute of Project Management (Certified Practicing Program Director), and is a Teaching Fellow in LPM at the University of New South Wales. Peter sits on multiple national and State working groups and committees for LPM, including AIPM, CLOC and the Law Society of New South Wales’ FLIP initiative. In 2018, Peter received State, national and regional Asia-Pacific awards for innovation and change in LPM.

 

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