12 Nov The in-house legal department and the C-Suite connection
Digital Transformation has been an important goal for nearly all companies during the last years but it was not like this for the majority of legal departments. After Covid19 this situation have changed and now, Digital Transformation it really is the number one priority to them, but, what is Digital Transformation?
Digital Transformation is certainly not only about implementing technology. Technology implementation is the last part, the ultimate thing to be done and is the result of a larger process. Most legal departments go to consultants asking “which technology should I be using to manage my documents, or my matters, or my contracts” and it’s ok, but this is not the point if we talk about Digital Transformation.
Digital Transformation is about client centricity.
Is about thinking, in the first instance, what our client wants or needs. And they care very little about how efficient we are, or how we handle our contracts lifecycle unless it has a significant impact on their business. That said, the next questions would be: who is my client? And what does he want? And the answer is simple: my client, or my “partner” in the case of in-house legal departments is the business unit, the company, and the clients of the company. So, the first thing we have to do is asking ourselves, or our clients: how can we do better for them in a way that matters to them.
For example: the company CMO. What is he worried about? Most probably, he would love to speed up the company go to market cycle. But what he is not at all interested in, is how we manage our contracts. What the legal department could do in this example, is talk to the CMO about the go to market cycle and try to see in which way the legal department, as lawyers, can help him to improve this very important KPI he absolutely cares about. Once we know what is important for our client, we can start thinking of which technology can help us.
Digital Transformation is much more than reducing legal fees and costs.
This is a very good point because most of the times, legal departments feel the pressure to lower their costs, and the very first thing we all think about is:
- Reducing the headcount
- Reducing external legal costs
- Implement technology to “do more with less”
A legal department can do this or a combination of these three things but unless we can prove the real value we bring to the business, the legal department will always be seen as a cost center, and therefore, the pressure to reduce cost will always be there. This is where Digital Transformation can really help because it is much more than reducing fees and costs.
Digital Transformation is about:
- Changing the way we deliver our services.
- Changing the way we work with external legal providers
- Having stronger relationships with both.
- Solving real problems in a more effective and efficient way.
- Bringing more value to the company
- Presenting the legal department as a strategic department being part of the value chain the company delivers to clients.
In this highly competitive environment, it is urgent that legal departments play a strategic role within the company. And this is not a matter of cost reduction.
There are other ways to achieve cost savings other than negotiating discounts with legal suppliers, for example:
- Redefining the relationship between them making it a more collaborative one.
- Changing the pricing model in a way both parts feel comfortable.
- Implementing legal project management methodologies.
- Defining the different types of work the legal department needs
- Deciding if other legal providers, such as ALSP can do some of this work.
- Defining goals, objectives and metrics to be achieved working together.
Remember that asking for a discount is never a good way to treat a provider, a trusted provider that sooner or later will have in its hands some of the most important legal problems of the company.
How can the legal department engage the CSuite in the Digital transformation process? Do they need to be aligned?
Absolutely. But there is not a way the general counsel can involve the C-Suite in this process unless they really feel it’s about them. If we just tell them that we want to be more efficient, that we want to improve the quality of our contracts… well… these are things the C-Suite does not care about at all. We need to talk about metrics that C-Suite cares about.
The CMO, the CFO, the CTO, the COO… all of them have their own Dashboards and kpi’s. Let’s talk about how we can help them achieve or improve their kpis.
Sometimes, the legal department is seen as the “stone in the shoe” being the ones saying “no” to most things, delaying or stopping things….Let’s change this! But this can only be done if we can have a real, open and frank conversation about what really matters to them and then, try to find the ways to help them.
This way, we will be seen as their allies, they will come to us more frequently and with a more open minded attitude.
The fact is that Digital transformation is about changing the way things are done with a more client centered approach. Being this true, we can not aim to do this process without the involvement of the C-Suite.