The greatest challenge faced by in-house legal teams

The greatest challenge faced by in-house legal teams

Published:

Author: Joe Stephenson

Applies to: Worldwide

A recent study commissioned by the Solicitors Regulation Authority (SRA) on the in-house legal community has revealed the greatest challenge currently faced by in-house legal teams. This article considers this challenge and how it might be addressed.

DESIGNED FOR IN-HOUSE LAWYERS

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The SRA recently published a large-scale study of some 2000 in-house solicitors in the private, pubic and third sectors entitled 'The role of in-house solicitors'. In addition to providing a comprehensive analysis of the composition and segmentation of the current in-house legal market, the study also provides an insightful picture into life as an in-house solicitor.

Of most interest was the response given by in-house solicitors when asked what was their greatest challenge faced over the past 12 months.

Almost 80% of respondents cited 'meeting heavy workloads with limited in-house resource' as their first or second key challenge.

Although the study does not go on to analyse why so many in-house solicitors feel this way, it is perhaps easy to draw one's own conclusions when considered in light of some of the study's other key findings, which can be summarised as follows:

  • Static or shrinking team sizes - the study revealed that approximately 70% of in-house legal teams do not expect to grow in size over the next 3 years, of which 20% actually expect team sizes to reduce
  • Pressure to provide strategic input - the study explained that the role of in-house solicitors has radically evolved since their early days in the '60s and '70s where their primary function was to act as internal compliance officers and conduits of instructions to law firms. Today's in-house solicitors hold a significantly more complex and demanding 'counsel' or even entrepreneurial role in which providing strategic advice is an essential part of the job. In fact, a survey carried out by the University of Oxford in 2011 of 52 general counsel showed that nearly all were on the executive committee of their business
  • Meeting business expectations - notwithstanding how the in-house solicitor role may have evolved as noted above, it is apparent from the study that their employers still expect them to perform, and possibly prioritise, more traditional functions. When 525 members of senior management were asked as part of the study what they consider to be the benefits of having an in-house legal team, the top answers were not, sadly, strategic input and expertise, but reducing legal spend and improving the efficiency of managing internal legal affairs. This is further corroborated when in-house solicitors confessed that their most frequent work activity was day-to-day transactional support for their businesses, occupying on average 44% of their total workload. Working on routine commercial contracts was cited as the worst offender

So can this be reconciled? Is there a solution that frees an in-house solicitor to fulfil their strategic function whilst servicing their business' day-to-day needs, all without increasing the size of their team or external legal spend?

Well, a trend is emerging amongst some forward-thinking in-house legal teams to 'systemise' routine legal functions to lighten workloads and, actually, cut their costs.

What started out as tentatively off-shoring basic legal functions such as due-diligence and litigation disclosure exercises to the likes of India and the Philippines around the mid to late '00s (often referred to as 'Legal Process Outsourcing'), is now fast developing into a sophisticated, technology-led industry. In-house solicitors can now outsource a year's workload of contract reviews and negotiations to on-shore providers for less than the cost of employing an additional junior resource (and without the drawbacks of additional headcount and cost of supervision).

Law firms such as Shoosmiths are leading the charge in this area, utilising its UK national footprint to offer low-cost systemised solutions, such as Spotlight, which provides a complete end-to-end review and negotiation service for routine commercial contracts managed by specialist outsourcing solicitors.

Not only are early-adopters of systemised legal services seeing their legal spend reduced and time liberated to focus on more strategically important initiatives, but evidence also suggests that the business' needs are serviced more quickly and efficiently, with turnaround times being significantly reduced. For instance, Shoosmiths' Spotlight service guarantees a 2 working day turnaround on all contract reviews.

The empirical evidence presented above certainly suggests that in-house legal teams are under increasing pressure to perform all roles expected of them.

On the one hand they are expected to perform as a 'modern' in-house legal team by adding value to the business through participating in strategic projects and initiatives. Yet, on the other hand, they appear shackled by the 'traditional' in-house legal duties that businesses clearly expect them still to prioritise.

But with a little progressive thinking there are solutions available in the market place that can reconcile these competing interests.

For more information or enquiries about Spotlight, please visit www.shoosmiths.co.uk/spotlight

Disclaimer

This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.