July 9, 2019
Meet the 2019 Value Champions: Applying Innovative Business Techniques to Optimize Value and Outcomes
Jennifer Salopek
As we mark our eighth year of selecting and celebrating ACC Value Champions, we can see an evolution toward greater adoption and adaptation of business practices within legal departments, and with growing sophistication. Whereas we used to think of in-house legal departments as co-located law firms and advocated for general counsel to have a seat at the business decision-making table, we now see them becoming more ingrained into the business as they embrace techniques that have worked in other departments. Where Lean was once the purview of manufacturing, Design Thinking the tool for product development, and Agile the province of software programmers and coders, these approaches have infiltrated in-house departments to the ultimate benefit of legal and the entire business. There is no mandate. Rather, legal executives employ these techniques to revamp legal service delivery 
when corporate strategic challenges demand new approaches.
 
The 2019 Value Champions provide successful examples of applying these techniques as they sought creative ways to tackle the challenges they face. They form a diverse group that includes financial institutions, a retail chain, and companies engaged in automotive and pharmaceutical manufacturing, engineering, insurance, telecommunications, and mining; representing the quest for improved costs, predictability and outcomes in South Africa, Australia, Europe, and the United States. The nominations were assessed by 2018 Champs Kristen Cook, Associate General Counsel for 7-11; Stan Smith, Senior Vice President and General Counsel for Software AG; and Doris Gilliam, Associate General Counsel for AARP.
 
“These Value Champions have demonstrated agility in applying business skills to address the challenges they face. They show how leading legal departments are applying client-centric process improvement models, using an array of sourcing and staffing models, sophisticated pricing models for outsourced legal work, and not just buying but also building technology applications to optimize delivery of legal services,” said Catherine J. Moynihan, associate vice president for legal services at the Association for Corporate Counsel. “It is gratifying to see the growth in depth and breadth of creative solutions to strategic imperatives.”
 
Process efficiency was the name of the game for a large subset of 2019 Champs. Rabo AgriFinance LLC (RAF) leveraged the corporate-wide adoption of Lean Six Sigma to address challenges in loan processing time. Discovering that the bank’s loan documentation and legal review process was inconsistent and inefficient, causing lengthy turnaround times, the members of the legal department turned the lens on themselves. Taking a good, hard look, the team decided the work would be better handled through outsourcing. Working with outside counsel at Thompson Coburn, they used data to create a new legal review model that assures predictability and appropriate staffing levels. Turnaround time has been reduced by 70 percent.
 
The legal department at Sonae, a multinational corporation in Portugal with a strong retail presence, made a similar discovery about the way in which they handled employee disciplinary actions. Finding that the internal proceedings averaged 90 days, they set about to improve the process and shorten the duration of those proceedings. Embracing the company’s use of Agile techniques, the legal department conducted a process mapping exercise that revealed key areas for improvement, which they tackled by developing a process management software solution in-house. Duration of the disciplinary proceedings has been reduced by nearly 30 percent while the number of cases handled has increased by more than 10 percent.
 
Telstra, an Australian telecommunications company, pursued process efficiency as a way to address the business challenges that had beset the company and its industry. To carry on after the painful loss of 25 percent of the legal team due to downsizing, the reorganized department adopted Agile practices to track, manage, and continuously improve its workload. Needing to reduce costs and improve performance of the legal function, the team created a streamlined new operating model aligned to practice areas that would allow the lawyers to focus on corporate strategic priorities, organized around key workstreams.
 
The small legal team at Hatch, a global engineering firm headquartered in Brisbane, Australia, embraced Design Thinking to re-engineer their processes in response to increasing workload. Working with co-Champ Lexvoco, an Australian NewLaw firm, they built an internal SharePoint site that makes contracts and legal resources more accessible and is organized around helping the company win new business. This path to client self-service has reduced routine work by two-thirds, allowing the legal team to focus on high-value issues and opportunities.
 
Toyota Motors North America (TMNA), a member of the process improvement vanguard, has its own formal continuous improvement process known as Plan, Do, Check, Act (PDCA). Faced with the challenge of taking value for legal spend to the next level, TMNA partnered with co-Champ Counsel Management Group (CMG) to arrive at a data-driven understanding of cost. Pricing matters on a unit cost basis, with clearly articulated scope assumptions, has enabled Toyota to realize budget predictability within a 10 percent range while reducing spend by 17 percent annually.
 
At insurance company MassMutual, the legal operations team applied the corporate Lean mindset as they worked with data scientists to identify blocks of litigation appropriate for more sophisticated alternative fee arrangements. Data modeling helped them formulate an agreement with a new national coordinating counsel with an informed idea of what the work should cost. Results include a legal spend reduction of more than 12 percent per matter, and collaboration on a Lean approach also delivered a reduction in matter duration of more than 40 percent.
 
Many Champs this year employed sophisticated strategic partnering to achieve their value program goals. The hallmarks of these partnerships are a deep mutual understanding and trust, as well as seamless integration of external resources into in-house efforts and teams. For example, Deutsche Bank expanded its relationship with LPO and co-Champ QuisLex (also honored in 2018) not only to bring artificial intelligence to e-discovery but to engage in a partnership that represents a melding of internal and external teams. The cost of managed review has declined by nearly half.
 
Deutsche Bank and QuisLex also homed in on the high costs of e-discovery. By enforcing standardization and building a tech-enabled review process that uses automation to perform previously manual tasks, the co-Champs brought in more than 90 percent of managed review projects on time and within budget.
 
More intertwined people, processes, and technologies are also evident in the sophisticated partnership forged by Anglo American, a South African mining company, and LPO Exigent. Like Telstra, Anglo American encountered industry difficulties that resulted in a downsized legal department. But the company’s pre-existing relationship with Exigent positioned it well to withstand the changes and do the work. A dedicated Exigent team began to work onsite at Anglo American, melding itself into the in-house team and taking on low-value work so the Anglo American lawyers could focus on the high-value work crucial to their business. Contract turnaround times were reduced sevenfold.
 
As is common among Value Champions, many of this year’s winners found innovative ways to use technology to solve their departmental challenges. Pharmaceutical manufacturer AbbVie’s new legal operations team secured their can-do image by bringing litigation data processing in-house, essentially positioning themselves as an e-discovery vendor inside company walls. Once that competency was in place, they also combined their document review databases and began hosting those themselves. All told, these efforts represent approximately $4 million in avoided spend, plus value-add to their colleagues in litigation as they consult on early case assessments.
 
While the AbbVie legal ops team took a DIY approach to e-discovery, several other Champs have built systems that encourage internal clients to do it themselves. Computer security company McAfee created Hoot, a technology solution that automatically routes legal queries to the correct reviewers and provides pre-programmed answers to common questions. As a result, costs have declined by more than 60 percent and reviews for product updates can be done in a week. The Hatch/Lexvoco SharePoint site makes it easy for salespeople to help themselves to contract templates, confidentiality agreement forms, and other commonly requested documents. Post-downsizing, a new digital front door—an interactive web form--allows the Telstra legal team to continue to serve with an enhanced understanding of internal clients’ requirements and instructions. Sonae’s new process management software solution integrates a knowledge management platform that archives documents users can adapt and share.
 
Alternative fee arrangements based on a mutual understanding of value remain critical to current and aspiring Value Champions’ quest for greater value from legal spend. The pricing methodologies used by both Toyota and MassMutual are significant because so many lawyers, both in-house and outside, still try to estimate costs by figuring out how many hours certain tasks or matters will take; whereas these companies use unit cost as a different kind of building block, documenting assumptions so that the matter budgets flex appropriately with changes in scope. Flexibility leads to sustainability of the pricing models, and even more important, predictable spending.
 
To hear more about the 2019 Value Champions and innovative legal practices that improve costs, predictability, and outcomes, attend the two ACC Value Champions sessions at the ACC 2019 Annual Meeting in Phoenix, Arizona, October 27-30, 2019.
 
 
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Mythbusters: Legal Industry Innovation via Law Firm Subsidiaries - Is This the Best Approach?
By Rachel Zahorsky, Director, Client Solutions at Novus Law LLC
Sente Advisors Principal and CEO, Ryan McClead, is frustrated by innovation. Not the innovation itself, but the proliferation of law firms claiming to offer innovative services that may actually detract from the legal services that clients need. He sat down with ACC Legal Ops Observer Contributing Editor, Rachel Zahorsky, to talk about these spin-offs and what Legal Operations professionals can do to ensure they receive value and true innovation from their law firms. 
 
Rachel: Tell me what got you thinking about this topic. 
 
Ryan: There has been a proliferation of law firms announcing subsidiary innovation programs and I’m not convinced that any one is really doing it well. What I wonder is whether a law firm that announces they have created an external subsidiary to “do innovation” on their behalf is claiming they cannot possibly improve the way they are currently practicing law? Or are they admitting that they can’t change the way they practice inside their current structure?
 
I have yet to see any of these programs that are outside of the firm move any of their innovations back inside the firm. I understand the impetus to move innovation outside for expediency, to bypass politics, or to take on additional capital - both intellectual and fiscal – but I am not sure how it actually changes the practice of law inside the parent law firm. 
 
Q: How can Legal Operations professionals ensure they are getting value from these subsidiaries? 
 
A: From an ops perspective, if your law firm is touting an external subsidiary, be direct: How does this help me as the client of the law firm? In what way does this effect the legal work you are doing for me? If there’s been a large, splashy announcement, there’s always a quote in there from a managing partner who is touting the great benefits that will be derived from this new entity. Go to that person and have an in-depth conversation on innovation and the changing practice of law and find out how much they really understand about how this new external entity will change the core firm.
 
I mostly work with internal innovation teams who are trying to improve the practice of law from inside. I have seen how the energy and money that an external organization spends can suck the wind out of that internal innovation process. If you have an external entity getting the press and buzz, it’s kind of deflating for the inside team. That is a potential downside to law firm clients, because these are often the teams that are actively working to improve your client services.
 
Q: How can firms approach innovation more efficiently?
 
A: I believe they need a team that is actively working within the firm to improve processes, technology and create better experiences for their lawyers and clients. 
 
If they want to do this externally, for all of the very good reasons I previously mentioned, I believe it would be more effective to set up a subsidiary firm. They could populate this firm with laterals or lawyers from the parent firm who are excited about practicing in new and innovative ways. This would allow the innovation team to improve client services without fighting the substantial barriers to change that exist inside the parent firm. Clients who are looking for a different kind of engagement could migrate some of their work to the new subsidiary, while still maintaining their long-term relationships with the parent. Over time, as client demand for new ways of working increases, the subsidiary could replace or merge with the parent.  
 
Some firms are beginning to cater to clients willing to do things differently: setting up alternative fee structures and collaborating with their clients to build new processes and solutions to make their experiences better. But that only gains traction if a firm that’s actually practicing law is using these new approaches. 
 
Q: What do you see as the future of innovation in the practice of law? What is next and who is leading the way?
 
A: You are seeing it happen with a handful of large corporations that know they have the clout. For instance, the “Innovation Days” that Microsoft hosted last year. They brought their panel firms in and said, “Okay, show us what you’ve got that’s innovative.” Now they are actively working with their firms to develop custom solutions based on those original ideas. More clients could and should be doing that kind of thing. 
 
And the thing is, you don’t have to be Microsoft to do something like that. We talk to a lot of firms with innovative ideas. More often than not, those ideas are inspired or directly requested by their clients. Even relatively small companies have enough clout with law firms to say, “We want to do X differently and want to work with you on that.” 
 
Clients need to work directly with their law firms to solve their problems together. Don’t wait for the firms to bring you ‘innovation.’ Don’t expect a firm to become innovative because they’ve announced an innovation subsidiary. Offer to collaborate with your firms to create a better work experience for you and for them. If they’re not interested, then find another law firm. 
 
Sente Advisors Principal, Ryan McCleadhas been an evangelist, advocate, consultant, and creative thinker in Legal Technology for more than 15 years. Most recently, Ryan was SVP at Neota Logic, an expert system platform focused on the legal industry. Prior to that he led global innovation initiatives at Norton Rose Fulbright. Ryan is a 2015 FastCase 50 recipient, a Fellow in the College of Law Practice Management, and one of the 'geeks' at 3 Geeks and a Law Blog. In past lives, Ryan has been a Knowledge Manager, a Systems Analyst, a Fashion Merchandiser, and a Theater Composer.
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ACC Xchange 2020 Call for Programs
 
ACC Xchange 2020 | April 19 - 21 | Marriott Marquis Chicago
ACC's mid-year meeting for advancing legal executives​
 
ACC Xchange brings together current and rising law department leaders: both legal operations professionals and in-house counsel.* The meeting will feature advanced-level programming and interactive, collaborative sessions focused on sophisticated law department management and professional development.  
 
To ensure the conference programming meets the needs of our members, we invite you to contribute your know-how, and round up proposals from in-house colleagues or trusted vendors. We are seeking program proposals designed to help participants:​
  • Advance their legal operations function with regard to strategic planning, optimizing sourcing and staffing, leveraging cutting-edge technology and processes, and employing effective change management techniques. 
  • Provide strategic advice to the corporate client on substantive areas of law ​that are increasingly relevant.
  • Structure and lead negotiations for complex business transactions, including with executive counterparts. 
  • Develop programs, guidelines, and processes to ensure employees receive compliance training on issues that create substantial risk. ​
  • Enhance leadership capabilities and business acumen to advance professionally and maximize impact as a legal executive.​​
  • Discuss and formulate solutions for challenges specifically applicable to ​small legal departments with limited resources. 
We welcome submissions on any topics designed to help advance law department leadership, along with your ideas about how to make the sessions engaging and practical. There are white boards in all the classrooms - let's ditch the decks and use markers!  
 
*The target market for this conference is general counsel, deputy general counsel, chief counsel, practice area and legal operations leaders, and rising mid-career corporate counsel from all industries. 
 
Submission Deadline: July 31, 2019​
Submitters will be notified by mid-September whether their program idea is accepted or declined. If your program is accepted, you will receive complimentary registration as faculty.
 
Questions... 
...regarding legal ops content? Contact Catherine J. Moynihan at moynihan@acc.com
...regarding in-house counsel content? Contact Amara Nwannunu at a.nwannunu@acc.com​
 
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ACC and MLA Release 2019 Global Legal Department Benchmarking Report

The ACC released the first Global Legal Department Benchmarking Report, which tracks standardized metrics, both financial and operational, in 508 corporate law departments, operating across 30 countries and 71 industries. Those metrics quantify the most recent trends in staffing, inside and outside spend, workload, work allocation, law firm and fee structure usage, and legal technology adoption. The report also tracks each law department’s self-assessment in 10 key performance attributes. 

While the summary is free, reports that compare legal department data in the same company revenue, industry, legal staff size, and company ownership structure categories are available for purchase.  In addition, legal departments can commission bespoke reports to analyze performance relative to comparable peer groups.

“The scope of this report is remarkable,” said Veta T. Richardson, president and CEO of ACC. “It creates a framework for law departments anywhere, of any size and in any industry, to explore the broader in-house community with their own specific data needs in mind.”

Major, Lindsey & Africa Partner and Vice President of Retained Search and Advisory Services Greg Richter added: “We are thrilled to work with ACC to offer a report with such comprehensive coverage of key law department metrics. The ability to compare your law department to more than 500 others in such detail is incredibly significant for performance-focused general counsel worldwide.”

As part of the release of this comprehensive benchmarking data, ACC has partnered with Smarter Law Solutions to offer law department customized consultations. All consultations will utilize ACC Benchmarking Report data. The Smarter Law Solutions consultancy improves the legal coverage, compliance and client satisfaction of legal functions while optimizing their headcount and reducing overall legal costs, including liabilities and external law firm fees. The award-winning Smarter Law methodology uses a broad range of proven, real-world techniques from Emotional Intelligence to Artificial Intelligence, from soft skills to hard data.

The report is available at www.acc.com/benchmarking. Information on the advisory consultation services, including the free consultation, is available at www.acc.com/smarterlaw

 

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Meet Interest Group Chair Sheena Ferrari
Here's the latest in a series of articles to introduce the chairs of the various Interest & Regional Groups within ACC Legal Operations. This month we present Sheena Ferrari, Senior Manager of Legal Operations at Blue Shield of California and the Chair of the San Francisco Regional Group.  

Q: Tell us one thing most people don’t know about you
 A: I lived in Paris for graduate school and speak French.
 
Q: One thing you’re excited about in your role as chair
 A: I'm excited to foster further information sharing within the Legal Ops community! I volunteered to make sure the SF regional chapter has the best content and connecting power as possible. 
 
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Upcoming Events in July

View all upcoming ACC events here
 
Date: July 9 at 12:00 (GMT)
Interest Group: Legal Operations Europe
 
Date: July 9 at 3:00 p.m. (EDT)
Topic: Knowledge Management Toolkit Resources (Webinar)
Interest Group: Process, Project & Knowledge Management
Email lawdepartmentops@acc.com to register. 
 
Date: July 11 at 2:00 p.m. (EDT)
Topic: Managing Risk with Outside Counsel (Virtual Roundtable)
Interest Group: External Resource Management
Email lawdepartmentops@acc.com to register. 
 
Date:  July 16 @ 2:00 p.m. (EDT)
Topic:  Internal Resource Management Toolkit Review (Webinar)
Interest Group:  Internal Resource Management
Email: lawdepartmentops@acc.com to register.

Date: July 17 at 3:00 p.m. (EDT)
Topic: Discovery Process: Pain Points (Virtual Roundtable)
Interest Group: Information Governance & Discovery
Email lawdepartmentops@acc.com to register. 
 
Date: July 18 at 1:00 p.m. (EDT)
Topic: Metrics - How Did You Get Started? (Virtual Roundtable)
Interest Group: Metrics & Analytics Interest Group
Email lawdepartmentops@acc.com to register. 
 
Date: July 23 at 3:00 p.m. (EDT)
Topic: Document Management Implementation (Virtual Roundtable)
Interest Group: Tools & Technology
Email lawdepartmentops@acc.com to register. 
 
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Highlights from the ACC Legal Ops News & Announcements Page


 

The ACC Legal Ops News & Announcements tab tracks the best items to keep you well informed. Following are some highlights:

Now French Lawyers Demand Statistical Data Ban, Following Judges’ Move
In a stunning escalation of the movement against statistical analysis in litigation, the French National Bar Council is now demanding lawyers are also excluded from statistical analysis of their actions in court. The move follows the news last month that France’s judges had gained for themselves a ban on the use of public court data for the statistical analysis and prediction of their decisions in court. [Artificial Lawyer]

Can Cloud Providers Calm Legal’s Apprehensions?
Cloud computing is becoming more widely used than ever before by corporate legal departments and law firms, mainly because of the flexibility and lower cost such technology affords. Yet some haven’t fully jumped on the bandwagon just yet, slowed by concerns over security and data access. To be sure, most lawyers are using cloud computing platforms for their practice. [ALM]

INSIGHT: Evaluating AI Accuracy for Contract Comparisons
Contract abstraction tools powered by artificial intelligence are gaining popularity in the legal industry, but how accurate are these tools? Chase D’Agostino of QuisLex gives tips on determining when AI results can be relied upon and where to use quality reviews by people. [Bloomberg]

Electronic Signatures: Legal & Practical Considerations for E-Signing on the Virtual Dotted Line
In assessing whether or how to employ e-signatures, particularly in higher risk transactions, organizations should be careful to manage the practical issues and potential legal complexities associated with e-signatures through careful assessment and a robust governance program. [ALM]

We are adding more hand-picked items all the time - be sure to bookmark or subscribe to http://www2.acc.com/legalops/news/.

 

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How to Get More Involved in the ACC Legal Ops Community
There are many ways to get involved with and contribute to the ACC Legal Operations community and raise your professional profile. We would love to hear your ideas, learn and collaborate together!
  • Post your queries, requests for referrals, tips for colleagues and share homegrown resources in the Member Forum
  • Join the ACC Legal Operations Maturity Model 2.0 working group. Things are evolving fast and we are excited to take the acclaimed model to the next step. The Interest Groups are already making updates, and we are seeking volunteers to join the team to update Change, IP, Contracts, Financial & Compliance Management.
  • Participate in or start a Regional Group to build relationships through in-person interaction. 
  • Champion the Legal Operations function - the ACC Legal Operations LinkedIn Showcase page offers peers, in-house counsel and others in the legal ecosystem leading practices shared among our members.  Help show off the value of legal ops professionals - follow it to get updates, share and tweet articles (#ACCLegalOps).
  • Let us know if you would like to be featured in or author an article in the ACC Legal Ops Observer, the ACC Docket and the LinkedIn Legal Ops showcase page (a package deal!).  
  • Be an Ambassador – many GCs are curious about the rise of legal ops, and we are communicating best practices at ACC Chapter events. We even have a “Legal Ops 101” deck you can use as a template. 

Email us to get involved - with offers to share your know-how, suggestions or any questions! LawDepartmentOps@ACC.com.

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Not a Member of ACC Legal Ops? Join Now!

Join now to get access to resources, participate in any of the Interest Groups, and use the online Member Forum for ad hoc benchmarking and referrals. The ACC Legal Ops section is active throughout the year, adding resources, conducting benchmarking studies, and providing webinars by legal operations professionals, for legal ops professionals. 

For more information, visit www.acc.com/legalops or contact LawDepartmentOps@acc.com

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Contributing Editor:

Meet the 2019 Value Champions: Applying Innovative Business Techniques to Optimize Value and Outcomes
Mythbusters: Legal Industry Innovation via Law Firm Subsidiaries - Is This the Best Approach?
ACC Xchange 2020 Call for Programs
ACC and MLA Release 2019 Global Legal Department Benchmarking Report
Meet Interest Group Chair Sheena Ferrari
Upcoming Events in July
Highlights from the ACC Legal Ops News & Announcements Page
How to Get More Involved in the ACC Legal Ops Community
Not a Member of ACC Legal Ops? Join Now!
Our Mission
The Legal Ops Observer is devoted to reporting on issues important to the members of the ACC Legal Ops section— from the challenges they face to best practices that work, to how members effectively implement innovation within their individual companies and define the future of legal ops across the industry. Follow the ACC on Twitter at @ACCinhouse #ACCLegalOps.
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