How corporate legal teams can use technology to go from the 'department of no' to a critical part of the business

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Corporate legal departments have long been stereotyped as cost centers that can stand in the way of new ideas. But the pandemic is giving legal teams an opportunity to embrace change and shape the future of their work.

In-house legal teams stepped up to the plate in 2020, handling a bigger workload amidst increasingly-strained budgets, according to a new study from Thomson Reuters. Of the 223 law departments surveyed by Thomson Reuters, eight times as many said they experienced a surge of work last year as opposed to a dip. 

During the past year, legal teams with a proven track record of investing in technology, automation, and flexible work arrangements were well-positioned to take the challenges of 2020 in stride. Departments that didn’t invest before the pandemic were “caught flat-footed,” according to Hillary McNally, general manager of corporate legal at Thompson Reuters.

“This is an opportunity to rebrand legal departments, which have long been associated with reasons not to do things, or the ‘Department of No,'” McNally said. 

In-house teams can do more with less

Corporate legal departments were busier than ever in 2020, often doing more with less. 58% of legal departments said their workload increased over the year, while 29% of departments decreased their budgets. 

Part of the uptick was due to legal teams handling health, safety, and employment issues directly related to the pandemic, McNally said. Safety precautions like temperature checks were complex issues for legal departments because there are privacy laws that impact whether you can take someone’s temperature and what you do with the data — and those rules differ around the world. 

“That’s where you saw a big difference between legal departments’ ability to respond effectively based on the resources they’ve been given,” McNally said. 

Legal teams can continue to thrive with this new balance by embracing flexible work opportunities and investing in new technologies, which can refocus precious time and energy away from administrative tasks and toward more high-level, creative work. 30% of law departments said they were increasing their technology spend, and 40% said they’re planning to use more of their existing technologies, such as eBilling, contract management, legal research, document management, and legal hold.

Technology can also free up time for legal departments to communicate better with colleagues in different departments, McNally said.

“You want to facilitate engaging conversations so it’s not just the business coming to you when they need advice, but that you’re proactively sharing insights,” she said. This means quantifying success through metrics — like how much practice areas are spending; forecasted vs. actual spend; the number of matters opened and closed; and legal spend as a percentage of revenue — to show how corporate legal departments are saving money and becoming a profit center.

“It’s also a good defensive tactic when it comes to the next round of budget cuts,” McNally said. 

Legal departments should rethink their recruiting pitch 

Corporate legal teams have traditionally found it hard to compete with law firms for talent. 30% of law school students said they’d take an in-house job, but only 11% said it was their preferred career choice, according to the study. 

But a year into the pandemic, 80% of lawyers surveyed said they want to keep some aspects of the flexible, work-from-home environment they currently enjoy. In-house teams have long had a leg up on law firms in terms of work-life balance, McNally said, and there’s now a better opportunity to compete for top talent. 

As the role of corporate legal departments continues to grow, there are also more opportunities to hire for legal operations roles. 81% of legal teams said they’re hiring for this type of role, which McNally said is a “dramatic jump” compared to a year ago.

“These roles are really critical in terms of creating those standard practices across the legal department, and often they are a strong advocates for embracing efficiency and keeping track of those associated metrics,” she said. 

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