Eric Eckhardt, Vice President, Legal Solutions weighs in on innovation and how it applies to the future of corporate legal operations.
Once upon a time (the year 2000ish) in a land far away (the conference room most often used by the C-Suite) spreadsheets were reviewed and reports were read and everyone scratched their heads asking “What are we going to do about Legal?” Budgets were mounting and benefits were largely intangible, not because they weren’t important, but because they weren’t necessarily measured to a magnitude commensurate with cost. Someone (probably a COO) said something along the lines of “We just need to apply the concepts that govern the rest of this place to legal.” The legal operations profession was conceptualized.
20 years later, the ACC and Wolters Kluwer have developed the legal operations maturity model and surveyed legal operations professionals to gauge advancement in the field. The 2020 Legal Operations Maturity Model Report paints a picture of functional progress most influenced by corporate size and proportionate resources. The legal operations professionals who responded also rated their maturity higher than corporations without a dedicated resource which is likely more an indication of survey bias than the stated conclusion that dedicated resources make a difference. Even if that conclusion was sound, the report indicates that average overall maturity is sitting below the halfway point on their scale. 20 years in and there is still far more to travel. So, where did the story deviate from the outcomes conceptualized in the boardroom?
The ACC model helps us understand Legal Ops’ functional priorities (with compliance and financial management at the top of the list). The report also identifies challenge areas, which are the functions with the highest importance with the lowest maturity. These include change management, knowledge management, process/project management, metrics and analytics, and innovation management. It raises the question: “How can an emerging function stagnate and struggle with innovation management for 20 years?”
There were some clues in the narrative responses provided in the report that mirror common discourse in the marketplace, many of which fall under the umbrella of innovation. Notably, the challenges indicated in the report for achieving innovation maturity all speak of budget constraints and difficulty with tech buy-in or adoption. I found myself yelling at the computer screen: “Technology and innovation are not the same things.”
What is innovation, in reality? Different experts provide nuanced definitions, but practically they all have common elements. Innovation is a culture that fosters ideation, is supported by process, and offers quantifiably improved results (revenue, products, efficiency). Can technology support innovation? Of course, it can. Can new technology adoption or development be an example of innovation? Of course, they can. But you can have an innovative culture and innovative solutions without using technology. Tackling a budgetary challenge by restructuring a legal department that hasn’t changed in 40 years and engaging with an Alternative Service Provider could constitute innovation. It has all of the elements; an idea posed to a problem and a solution supported by process with quantifiable outcomes. It might not be as sexy as adopting an emerging technology, but it could be a stepping stone to a more innovative culture by stirring the proverbial pot and letting some really good ideas rise to the surface. Such an initiative could also help a legal department advance in maturity in all of the challenge areas listed and create a pathway to even more exciting innovation in the corporate legal structure and beyond.
Where to start? If we use the ACC model as a guide, the lowest hanging fruits for innovative focus are the top tier areas of importance – compliance and financial management. Ideating solutions to these types of challenges (most notably the ones felt by other business units with greatest commercial impact) will provide a larger captive audience throughout legal and beyond. Change management will be easier as you work to support solutions through process while quantifying the meaningful commercial impact for stakeholders. Drawing on the expertise of the right partner (in the form of an ALSP, consultant, a technology provider, or even all three) could help skyrocket these solutions to optimal outcomes with appropriate levels of disruption.
What about my tech budget? Understand your constraints and work through them; adverse conditions are often the catalysts for innovation. Maintaining a focus on resourcefulness and optimal budget allocations, you can take incremental steps to find cost-saving solutions. Proper planning and partnership with the right provider could free up funds for your tech endeavors if expectations are set accordingly. Just remember. cool technology isn’t going to solve your problems on its own. Throwing a tech solution at a broken process will only compound the issues and halt operational maturity.
Make your commercial case. Nothing you do is happening in a silo, so be sure to understand the goals outside of legal and manage the expectations of your internal customers. Often you will find inspiration in the way your predecessors in other operations capacities have solved their challenges. Stay aligned with your enterprise goals and be able to attribute value to your solutions. Value can be revenue enhancement, cost savings, risk mitigation, or service improvement.
How do we finish the story? How do we drag innovation out of the meaningless realm of buzz words? How do we prevent Legal Ops from being just a passing fad that evaporates into the ether of obsolescence? (I mean, 20 years in an average organizational rating teeters at mediocrity.) There is no silver bullet that will fast-track your legal department’s operational maturity, and each organization faces unique challenges to growth. There are, however, common themes underpinning the gaps highlighted in the ACC report. At Exigent, internally, we tackle operational innovation through culture, process, and technology and leverage those elements while working with our clients to develop a bespoke approach to their challenges, properly aimed, to further advance their legal department’s goals and maturity.
Contact us to learn how we can help drive operational efficiency within your legal department.