Author:  Simon Taylor     Lexpert October 2005

Although corporate counsel recognize the need to keep themselves and their department up to date on legal developments, surprisingly few law departments think in terms of building new product development into the services they offer their internal “client”. For many CLO’s, the effectiveness of the service they offer is geared to keeping their board aware of legal developments which impact on the company’s business activities.

Most law departments therefore service client requirements by responding with solutions. In any event, many CLO’s argue that new products are rarely applicable to the role they perform. When the law changes, they advise on those changes. When the company amends its business strategies, the law department likewise amends its offerings to take account of those changes. The process is reactive, not proactive, and possibilities for changing are few and far between.

Central to this argument is an understanding of what is meant by “product” and “new”. When the definition of product is limited to legal solutions, then clearly new product requires new law, or at the very least, new modes of service delivery.

Product, however, is capable of a wider definition. When product includes service issues; that is, when it encompasses not only what the law department does, but also how it does it, then the possibilities for “new product” expand.

Look at the service offerings of the law department. In many cases, these will be a combination of matters handled internally, and matters entrusted to outside counsel. Has the law department got this balance right? Could the same (or better) service be obtained by re-jigging this balance?

Look at the work flows into the department. Have the flows changed since the current configuration of the law department was established? Could the work flows themselves be more actively managed?

Look at the skills sets of the individuals who comprise the law department. The fact that they were sufficient some years ago does not necessarily mean they are still sufficient today.

Once corporate counsel starts to think in these terms, the possibilities for launching new products expand. Monitor work flows and then analyze the whys and hows of these flows. Ask whether the department could operate smarter and more efficiently. Take a dispassionate look at skills sets. Are they the best available, or could more be achieved with a different configuration.

A law department which starts to offer legal reviews, training for non-lawyers in the business units, and which evaluates its effectiveness vis-à-vis the commercial imperatives of the business is offering a new product. Likewise, a law department which, with outside counsel, offers specific, clearly defined solutions in a box to appropriate business units is offering new products.

Law departments of any size can make the leap and start to think about new products in the way outlined in this article. This concept is not the preserve of large, well resourced departments. Indeed, some of the smallest departments we have worked with have embellished their entrepreneurial spirit with a culture of innovative thinking and creative flair. These are the same departments which recognized that the old ways of doing things needed to be examined in the light of changing market conditions and corporate goals. They ‘smelled the coffee’ and saw the potential to capitalize on opportunities that were falling by the wayside. They realized that new products and new ideas gave them the edge when talking to their commercial colleagues. They made the department appear innovative and forward thinking.

So how do you do this? Assume a law department wishes to change the way it provides services. First, any planned changes need to work within the culture of the company. Whatever changes may be decided upon, it is the way the department offers its services that is changing, not the overall corporate culture. Changes also need to take into account the personalities and requirements of the Board of Directors. Changes which look good on paper will simply not work if the company is following a different agenda.

Secondly, the business case for change must be made. This is not merely a “feel good” exercise. It is founded on working smarter with the appropriate objective metrics. The value proposition must be established and agreed upon.

Thirdly, the project needs a leader who owns the process. Normally, this will be the CLO.

Finally, the new product needs to be tested and refined.

To embark upon new products in this way is a serious undertaking. That the end result will be worth the effort to implement is not the issue. Based upon law departments which have gone down this route, we know the end result is worth it. But, nonetheless, the time and energy required to implement such changes should not be underestimated. Professional assistance is almost always needed to effect the required changes if only because whilst the CLO is pondering change possibilities, the phone continues to ring, and the day to day demands and pressures never let up.