As corporate law departments adapt to a growing need for emotional intelligence and more holistic approach to managing relationships, leaders of these teams must re-examine department structure and adopt new strategies to navigate the changing business environment
Let me start by saying that anyone who thinks they know what the law department of the future will look like is guessing. To be sure, it’s less about trying to predict a specific future, and more about imagining the realm of possibilities in a rapidly shifting world.
Businesses around the world are going through a period of unprecedented change, including managing issues such as globalization and technologies such as AI. Perhaps most significantly, however, is that customers, employees, governments, regulators, investors, and other stakeholders are demanding that businesses take on an expanded scope of societal responsibilities. Businesses aren’t expected to simply make and sell widgets anymore; rather, they’re answerable to a broader range of societal issues that their operations impact, such as workforce wellness, environmental sustainability, and ethical supply chains, just to cite a few examples.
As a result, these businesses’ corporate law departments now need to be more attuned and connected with suppliers, suppliers of suppliers, customers, their customers’ customers, and on down the line. And department leaders need to keep their antenna raised at all times for the broad global trends driving whatever the next issues will be that their business will need to address.
Law departments increasingly need to face outwards as much as they do inwards. Many businesses are finding themselves unaccustomed to managing this new frontier of dealing with what are largely externally driven issues. And it is precisely here where a corporate law department can be a valuable resource that helps navigate the business through the increasingly choppy waters.
The question then becomes: how can the law department best do that? Unfortunately, advice for creating better law departments tends towards the all-too familiar refrains, be more efficient, be more agile, etc. While those may be laudable goals, they can also be fairly obvious to the point of being almost cliche. Hopefully, we all know by now that organizations need their internal legal team to be more efficient and agile.
So, what does the corporate law department of the future need to look like to succeed in this evolving role?
Re-examining the blueprint
We can start by taking a fresh re-examination of the structural blueprint of the law department, with the guiding principle that ideally, form follows function. A law department can produce exceptionally high-quality work but still carry an incomplete view of what work is being performed, who is doing the work, and how productive the process is. Understanding and optimizing those elements is as essential for the success of the department as the quality of its work product.
However, the seemingly never-ending workload demands of the average law department can make it easy to focus solely on work output. This can make it difficult to view performance at the macro level and evaluate quality, efficiency, and effectiveness against standard measures. And that, in turn, can hinder objective evaluations and ways to pro-actively seek opportunities for improvement.
Businesses’ corporate law departments now need to be more attuned and connected with suppliers, suppliers of suppliers, customers, their customers’ customers, and on down the line.
For example, many law departments are making use of alternative legal service providers (ALSPs) to handle certain routine legal work. While that’s a sensible move that can reduce costs, it’s often done on a project basis when needed. That’s a far cry from conducting a comprehensive analysis of potential opportunities to optimize and maximize leveraging ALSPs across the entire department.
I’ve seen many law departments reach a stunning realization when they truly see how much low value, routine, repetitive work is still being handled in-house across areas such as contract reviews, corporate governance work, and reporting compliance. For many law departments, the reality is that a good portion of the work can be done cheaper and more efficiently with as good or even better quality by either using different internal resources or outsourcing the work to third parties, such as contract attorneys, consultants, or ALSPs. While it can sometimes be difficult to systematically identify that work and assign it to more efficient channels, it’s exactly those types of structural changes that could move the needle in a significant manner.
The emotionally intelligent law department
As essential as rethinking the structural blueprint is, I would suggest that the more important transformation that will enable law departments to be equipped for future challenges goes beyond the realm of how and by whom the work is carried out.
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If there have been five big ideas that I’ve seen transform the business world over the course of my career, one of the most impactful has been recognition of the importance of emotional intelligence in creating high-performing organizations. This was not a popular concept when I attended business school decades ago; but since then, what I consider to be an irrefutable body of academic work has emerged on how the emotional aspects of work and relationships are as vital to the productivity of our business organizations as any other factor.
Emotional intelligence, in a business context, can be viewed as managing relationships with objectives, such as fostering effective communications, collaboration, engagement, and teamwork among others. It also involves developing skills around understanding the needs of others, responding to concerns empathetically, fostering trust, and being willing to accept change.
This may be of particular relevance to law departments not only because of its importance, but because of the magnitude of the cultural shift that it represents. While many businesses are embracing emotional intelligence at the managerial or even organizational level, this concept can be at odds with the sets of hard skills that have traditionally formed the core of lawyers’ stock and trade, such as the ability to be analytical, research-focused, and precise.
Emotional intelligence, in a business context, can be viewed as managing relationships with objectives, such as fostering effective communications, collaboration, engagement, and teamwork among others.
Law departments can carry a somewhat different view of relationships than other departments in the company. For example, while law departments may view many of their relationships within the company as either collaborative or consultative, the legal profession, by way of training and experience, can often cast relationships, particularly with outside parties, as being either adversarial or largely transactional in nature.
We need a broader, more holistic, more expansive, and more nuanced view of the myriad of relationship dynamics that make up today’s increasingly complex business environments. That can help law departments bring into clearer view the growing corporate responsibilities that I discussed earlier. The most successful law departments of the future will be the emotionally intelligent ones that can cultivate a deep understanding not only of the needs of the business, but of the global and societal drivers that are increasingly an integral part of how they conduct business.
Law departments are uniquely positioned to provide essential guidance and counsel to help their businesses thrive in that environment. However, it will necessitate recognizing that greater emotional intelligence can be a major productivity-enhancing strategy and practice. It can better enable law departments to better handle complicated work that stretches across growing portfolios of relationships, both inside and outside of the business itself.
The law department of the future
Bringing this back to the question of what the law department of the future will look like, the answer remains largely a mixture of guesswork and probabilities. However, we can see the drivers of the current business environment and the opportunities they present.
Corporate law departments have an opportunity to re-examine their structures and adopt a more holistic view of how they evaluate and manage their operations in this evolving business environment. Augmenting the innate legal and analytical skills of in-house counsel with emotional intelligence skills can improve management of key relationships. And this combination can enable departments to more effectively connect with their businesses to understand their strategic needs and meet those needs with the greatest efficiency and effectiveness possible.
Those traits can equip law departments to be best positioned to become the law departments of the future that they will need to be.
You can find more about the challenges faced by today’s Corporate Law Departments here
