10 May 2021
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Evolution of legal departments in the digital era

Observing how organizations are trying to get adapted to the context that the digital revolution is generating, we can rapidly extract some conclusions. Their hierarchy, structures, processes and even their external networks and forms of dealing with innovation and cooperation, are progressively becoming more open, horizontal, dynamic, liquid and transversal. 

The speed of management and innovation required are forces pushing companies to adopt measures in favour of avoiding silos, managing efficiently their knowledge, optimising the use of data and information and getting unified under the same governance model.  

The reason behind this “Why” it can be explained by Martec´s Law which states that whereas technology changes exponentially, organizations change logarithmically. As a consequence of these patterns, there is left an important governance gap in the middle which become more acute as time elapses. 

All these factors are creating and extending corporate cultures where all the areas and departments are expected to cooperate, co-create and be dynamic, efficient and aligned with business mission, vision, values and goals.

 

Now the question is “how is the legal function being affected by this scenario?”

In the last decades, legal departments had been providing their services in a field where disruptions did not almost exist because changes used to take place gradually. 

That is why words such as technology, innovation, organizational transformation are still concepts that even today, remain unclear and alien for many lawyers and law students. 

However, these circumstances are being dramatically transformed. In fact, we can already notice that deep changes are occurring among some legal departments, overall, in those ones imbricated in big and complex structures operating in an international scale. As prove of It, it is enough to go over any of the many reports that are periodically published by international legal counsel associations, big consultancy companies or multinational vendors corporations.

 

Source: Freepik

 

This new paradigm in the strategy of legal departments is essentially represented by Legal Operations, besides international standards and “best practices” also extended and applied by Legal Counsels globally.

It might be said that Legal Operations constitute a reference model that allows legal departments to evolve, improve and professionalize their legal services, measuring in every step which degree of maturity has been reached and what actions could be taken next to keep improving.

In many countries such as the United States, this is not a novelty. In fact, “head of legal operations” and related functions are highly demanded and critical positions inside legal departments. But in any case, the level of penetration of this set of methodologies is much more superficial in other regions and countries. Other crucial factors conditioning the degree of their adoption are the industry and the type and the size of the company.

On the other hand, the maturity of the own Legal Operations reference model is quite distant from being generally accepted, existing different approach elaborated by different International Legal Counsels Associations such as ACC and CLOC, which have created their own proposals condensing the knowledge, expertise and good practise of their members and the industry

As previously mention, despite the fact that an international standardization and consensus seem to be a high complex task, still far away from being mature and globally spread, the current reference models are really useful, sophisticated and efficient tools, that can guide legal departments in their way to improve, evolve and optimise their services. 

The common grounds and axes shared by these reference models are focused on fields such as: Strategic planning, metrics and analytics, compliance, IT governance, e-Discovery and management of contracts, projects, financial, IP, technology, internal and external resources and knowledge.

Furthermore, these legal operations frame also provide maturity models which define a set of features that characterise every stage of development (from the early phases to the advanced) for each of the previously explained operations. This is really helpful because allow legal departments to assess their situation of development and deal strategically with their following priorities and goals.

And this is just the beginning of what it looks like a natural path, because, as it was said before, nowadays, the need of convergence and alignment among all corporate areas with Business constitute a must.  

Furthermore, it seems that this trend will keep growing and of course, legal departments are not an exception to this tendency and will have to keep transforming their services in this direction. 

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