Like most legal teams, you’re no stranger to doing more with less. Thomson Reuters 2023 Legal Department Operations Index reports that 70% of legal departments are handling a higher volume of legal matters than ever before, despite budgets and headcount largely staying the same or declining. And with the need to control spend, many GCs and legal leaders are opting to use internal resources over working with outside counsel. Essentially, your legal team is expected to make a champagne fountain on a lite beer budget.
This means that in 2024, legal teams are putting a premium on efficiency: improving processes, developing performance benchmarks, and implementing the right tools like a legal metrics dashboard to measure your overall impact.
If you want to learn how to work smarter, not harder in 2024, here’s what you need to know to make your dream of a more efficient legal department a reality.
The efficiency imperative for legal teams in 2024
Let’s face it, economic conditions are a little unstable and everyone’s feeling the effects — especially growing companies with lean legal teams.
According to the ACC’s 2023 Law Department Management Report, businesses with under $1B in revenue have a median average of four legal professionals on their team, while businesses between $1B and $5B have an average of 17 people. Though larger businesses have larger legal teams, the legal headcount is still low compared to headcount in other departments like sales or customer success.
This stat has largely remained unchanged in the last few years. As Thomson Reuters reports, 65% of legal teams say their headcount is flat or declining. Meanwhile, 70% are experiencing an increase in legal matters. As legal adopts a more strategic role, your team is touching every corner of the digitally connected business and taking on more responsibility, despite the team size staying the same.
For 66% of legal professionals, budgets have also stayed the same or gone down. It’s no surprise, then, that 78% of general counsels (GCs) agree that cost control is a top priority for their teams. This means working longer hours won’t be enough to increase productivity. Given that 59% of today’s workforce feels burnt out, all this does is overextend your team’s bandwidth.
To improve team output and outcomes without stressing out your team even more, your legal team can prioritize improving your processes, tracking key performance indicators (KPIs) using a legal metrics dashboard, and onboarding technology to supplement your efforts.
This is where legal operations shines.
The role of legal ops in increasing efficiency and productivity
In 2021, inefficient processes cost businesses up to $1.3 million per year — an amount that’s likely higher today. Legal operations is the function that helps eliminate inefficiencies and develop systems that enable lawyers to deliver an exceptional work product in a timely manner.
According to ACC’s 2023 CLO Survey, 70% of chief legal officers (CLOs) named legal operations as one of their top strategic priorities. Legal ops keeps the legal department running smoothly and in the good graces of cross-functional collaborators. The number of legal teams with at least one legal ops professional has increased from 21% in 2015 to 58% in 2023, but less than 30% of legal departments report an increase in legal ops headcount.
As advocates for tech adoption in the legal department, legal ops teams improve organization by introducing automation, tracking KPIs, and streamlining collaboration between legal and other business functions.
Here are four ways legal ops helps improve lawyers’ work output.
Legal ops lets lawyers be lawyers
Instead of refining legal terms, focusing on negotiations, and collaborating with sales on deal strategy, too many lawyers are stuck in the weeds or putting out fires, hopping between spreadsheets, and trying to keep track of all the incoming requests and outstanding tasks. This means that things are bound to fall through the cracks and delays are inevitable.
With a legal ops function, lawyers no longer have to both manage and execute the work. Instead, legal ops creates systems and workflows that support lawyers’ work. By taking stock of cross-functional goals and where they overlap, legal ops can implement processes that support lawyers in doing their best work.
Connects legal to the rest of the business
When your lawyers are focused on doing the work, it can be difficult to get out of the zone to deliver seemingly quick progress updates. This often leads to frustration among your internal clients, as no one knows when the work will be delivered, if at all.
Legal ops teams open up the channels of communication between legal and the rest of the business, ensuring that the lawyers’ work gets delivered. They do this by implementing technology that aligns with legal’s needs and enables them on software and tools so that they actually use them. By improving collaboration and visibility, legal ops helps lawyers move faster, remove roadblocks in service delivery, and effectively communicate expectations with other teams so everyone is on the same page.
Champions technology
While many legal departments are keeping pace with tech advancements in the industry, some still rely on manual processes to accomplish crucial, time-sensitive tasks. Manual processes increase bottlenecks and limit the impact legal can have on the rest of the business.
Legal ops advocates for and stands up technology that automates processes and reduces the amount of time lawyers invest in low-value activities. When tech is mapped to the right processes, it enhances your workflow, improves your speed, and decreases the likelihood of errors.
Collects and analyzes data
Too often, legal teams don’t track what they’re spending time on or what the result of their work effort is. When you’re in the weeds all day every day, it’s hard to look up and see the forest for the trees. In particular, teams that still rely on manual processes have the hardest time accessing this crucial business data.
According to Deloitte’s 2022 State of Legal Operations Survey, only around 10% of legal professionals say they have and use well-defined KPIs to track their efforts. But with the technology that legal ops onboards, lawyers can have a bird’s eye view of what’s happening in the legal department, where the bottlenecks in the processes are, and how to improve their workflows going forward. Using a legal metrics dashboard, you can access data that shows you where you can have the most impact on your business.
Making the most of your tech stack for maximum impact
Manual processes take up a lot of time, increase the risk of human error, and leave you to make guesses when you need hard data. A true boost in productivity requires technology.
According to ACC’s 2023 Legal Technology Report for In-House Professionals, over 75% of legal professionals understand that legal technology is now a must-have for the modern legal department. With the right tools, your team can limit risk and put up numbers to prove your impact.
Nearly 52% of in-house professionals find contract management the most effective tool in legal’s tech stack, ACC finds. To many, the draw of contract management software is that it allows them to have a single source of legal truth, giving them a leg up on performance.
Here are some other legal tech tools that you can use to enhance your team’s execution.
Legal project management
Legal project management helps legal teams keep track of the issues moving in and out of the legal department and their outcomes. Instead of keeping a sticky note or spreadsheet with a running tab of tasks you owe sales or engineering, legal software helps you track requests, organize matters, and stay up-to-date on ongoing projects.
Document repository
A document repository helps you keep track of all your agreements, approvals, filings, and other business-critical documents. It also allows you to centralize these documents so all your stakeholders can seamlessly find what they’re looking for. This helps you to improve your compliance while also increasing visibility for your collaborators.
E-billing
While in-house counsel and legal leadership find contract management software the most useful, legal operations finds e-billing software the most useful. When managed manually, billing processes are tedious and can lead to contract value leakage. E-billing software helps teams effectively track spend and best of all, make finance happy.
Artificial intelligence
AI is having its moment in the sun. Legal teams across the globe have picked up on the potential of AI to drastically transform the way they work. AI can automate all parts of the contract process, both pre- and post-signature. It can also extract data and provide data-driven insights for smarter business decisions.
A word to the wise: While technology is incredibly powerful, it’s only as good as the process that underlies it. Be sure to flesh out your processes and understand how tech can help you improve before you take the leap to buy a new tool.
Three other things to look for in your new legal tech:
- Short time to value (TTV) — The less time it takes to see the value in your tool, the sooner you can recoup your costs and make a much-needed impact
- High return on investment (ROI) — With so many buyers having buyer’s remorse, ensure your vendor can tell you what your return on investment should be
- The ability to integrate with the rest of your tech stack — ACC’s report shows that 62% of legal professionals say one of the biggest pains they have when using tech is a tool’s inability to talk to the other tools in their stack. Integration avoids data silos and ensures everyone is on the same page.
In-house best practices for tech implementation
Close to 40% of in-house professionals say that they plan to buy more software in the upcoming year. Teams are largely looking into the tools named earlier — with 46% looking into contract management and 31% assessing matter management tools.
In addition to having a process to map your technology to, a key aspect of successfully onboarding technology is effective change management. A change management strategy helps get the rest of your organization to buy into the promise of the technology and guide them toward adoption and usage. Change management requires you to take an active role in getting people to shift from what they’ve always done to what will make their lives easier with just a little bit of effort.
Enabling your team on new technology increases the lifetime value of the tool and the chances your collaborators will use it. In a time when cost-control is a key priority, change management and tech enablement are essential.
Here are some quick tips for effective change management during tech implementation.
Include cross-functional stakeholders in evaluation process
One of the major benefits of using legal technology is being able to collaborate with your teammates better and provide more visibility into your processes. So when evaluating tech that other teams will also be using, include key stakeholders in the evaluation process. This helps ensure that you’re onboarding a tool that makes everyone’s lives easier — not just legal’s.
Make a plan for what’s to come
While you can’t promise what the future will hold, you can give your teammates a good idea of what they might expect. Create a timeline for implementation with your software provider so you can anticipate what things may look like leading up to and after the change. Account for potential disruptions to work and productivity in the beginning as people get used to the tool.
Communicate change
Just as important as creating this plan is sharing it widely. When people know what to expect, they surrender to change more willingly. If they don’t know what’s happening, you may face a lot of resistance, which ultimately undoes all your good work before you get started. Create a communication plan that outlines everything your team needs to know about the change.
Enable teams on the tool
Remember that people on your team will have different learning styles and speeds. Create a variety of training programs and materials that encourage them to go over the material with you, asynchronously, cohort-style, or whatever increases the chances of them using and loving the software.
Conclusion
It’s impossible to know what the market and economic conditions will bring from one year to the next, so business units like legal need to create and optimize processes that help you weather the storm of the season. This year, business leaders are prioritizing making good use of their resources and getting the biggest bang for their buck. This means adapting your processes and acquiring technology to meet the changes of your business.
The legal ops team supports the legal team by acquiring technology like CLM, document repository, AI, and e-billing software. These tools help lawyers to focus on strategy over tactics by delegating tedious tasks to technology. Legal ops also sets the groundwork for collecting KPIs and metrics using technology, allowing you to bring data-driven insights to the decision-making table.
Technology helps to increase efficiency, reduce costs, and improve compliance — which are the main reasons legal teams procure tech in the first place. A change management strategy is essential to getting the full value of the tool, as it helps reduce friction between the old way and the new way.
Once you have your tech up and running, be sure to continuously optimize your processes so that your gains scale with you.