Symptoms and Solutions for the Ageing Law Department

Author: Richard G. Stock - Canadian Corporate Counsel Association 11th Annual Conference brochure (1999 Annual Meeting)

Introduction

There comes a time when a General Counsel is faced with a mature "organization" or group to be managed. In those cases where there are several (4 or 5) lawyers and staff members, the balance of skills, demographics and ambition can shift after a number of years. The law department is especially vulnerable to a type of gridlock, since lawyers are either uninterested, unqualified, or cannot afford to move from current positions to others within the organization. The General Counsel must search for the early indicators and then manage to "re-engineer" the department.

Some of the Symptoms

An "ageing" law department is simply a reflection of the company in which it finds itself. This is true for at least a while. Then, one finds that the company, institution or government body is in turmoil because of market pressures or legislative changes. Law departments are particularly challenged when they must adapt. There are pressure points:

• lawyers in the department, especially in the medium and larger departments, may be assigned to or have preferred clients. These internal clients can be promoted or disappear from the organizational chart, leaving the lawyer with a workload to be filled
• some clients or files are more desirable than others and are a good way for the new members of the law department to acquire skills and knowledge of the company. The more established lawyers can be reluctant to share the client or the file. The clients themselves may resist changes from established patterns of doing business
• technology is transforming professional practice. The tools are available today for research, to create work product, to store and share it internally, and with clients, and with clients, and to keep track of the costs of internal and external legal services. There is inertia to be overcome when trying to persuade some counsel to adopt new operating protocols and productivity improvements
• members of the department can become unhappy about their total compensation. The company's job classification and bonus systems may appear ill-suited to the complex, strategic and economically valuable work performed by its lawyers. In addition, the room for advancement within the department or the company may be non-existent in the short-term

Some of the Solutions

There are Canadian law departments with five or more counsel which display all of the symptoms of premature "ageing". There are members who are not busy enough because of changes to their internal client base. There are others who do not want to share a client or move on to serve another part of the organization. Others may resist the use of technologies which make their work product more visible, shareable or accountable. Finally, there are law departments which seem to resist creating annual, measurable and results-oriented objectives for the department and for counsel as a building block for variable compensation.

Regenerating the law department, or any organization for that matter, requires that considerable and often unavailable time be invested to counteract each symptom. What has made individuals and the law department successful in the past ( talent, systems, good clients ) can disappear or be replaced. The General Counsel and members of the department should formalize their responses:

• reduce the statement of purpose and principle roles of the law department to no more than one page. Accomplish this with consultation in less than two weeks
• decide whether there is a place for legal specialists within the department or whether counsel are to be multi-purpose lawyers working with all internal clients. Decide what the file and client rotation protocols will be
• establish seven to eight measurable objectives for the department that cover client priorities, productivity improvements, and the acquisition of new skills and technologies
• link variable compensation, at least 10% of total compensation, to the achievement of team or department objectives. At least half of the variable compensation should be team-based, rather than depend on the accomplishments of individual counsel

Conclusion

General Counsel must supply leadership to law departments, which may show signs of ageing. This cycle can be disrupted, and priorities and behaviors re-established with:

• a clear purpose and position statement for the department and its members
• measurable goals for client priorities, productivity, and professional development
• a commitment to the use of legal and office technologies
• variable compensation that is team rather than individually based.