ACHIEVE YOUR GOALS:MARRYING THE BUSINESS OF LAW WITHTHE PRACTICE OF LAW
July 2017
LAW DEPT:EXPECTATIONSHAVECHANGED
Legal can no longer operate as a blackbox risk management function.
Legal must now:
• Align practice areas to revenuegeneration
• Achieve aggressive cost reduction targets
• Be preventative about risk
• Track to businessstrategic objectives
THE NEW TOOLS
Law departments are retooling torespond to the shifting paradigm.
Combining operations with lawyers togenerate:• Data and analysis• Automation strategies• Knowledge banks• Process and workflow
Resourcing is a mix of in-house andoutsourcing to optimize fixed andvariable costs.
OBSTACLES TO CHANGE:
TOO BIG OR TOO SMALL?
Large Departments• Pro’s: May have more resources and dedicated
personnel• Con’s: Can develop silos or duplication of effort
Small Departments• Pro’s: May be closer to the Business and may be
able to leverage business expertise• Con’s: May have limited resources and may be
overwhelmed with the press of daily workloads
Strategizing Change1. Scope Project & Key Goals2. Set Timing3. Assign projects and keep people accountable4. Execute (make the time) and re-adjust the goals
if needed
TODAY’SFOCUS –THREECOMMONPROBLEM SETS
1. Law Department Metrics:Implement the processes and toolsnecessary to make data-driven legaldecisions
2. Contract Lifecycle Management:Gain control, improve compliance, andreduce leakage
3. Serial Litigation:Harness data to drive outcomes andreduce total cost of litigation
Demonstrate the law department’s value in termsthat the CEO/CFO can understand
Truly understand what our bottlenecks and costsdrivers are so that we can address them effectively
Show other portions of the business how they areimpacting legal processes and costs
Measure and improve our quality and service levels
Look as professional as the other functions whenpresenting to the board
LAW DEPT. METRICS:COMMON BUSINESSCHALLENGES
Question: We don’t have the data we need to:
LEGALMETRICEXAMPLES
LawDepartment
• Legal spend as % of revenue• Client satisfaction
Contracts
• Transaction cycle times• Legal cost per contract completed• Term adherence
Litigation
• % cases resolved within parameters• Average cost of case resolution• Cost of resolution as a % of exposure
RegulatoryCompliance
• # hotline interactions• Legal cost per transaction screened• Risk-weighted exposure
• Lawyers: Generate dataneeded to track metrics;tune legal strategiesbased upon indicatorsfrom metrics
• Operations: Metricdefinition, automation,process and workflow, &data analytics
LAWDEPARTMENTMETRICS --EXAMPLES
• Company needed metrics to (A) show value ofdepartment and (B) have the insightsnecessary to optimize its processes
• BC team devised solution for capturingmetrics associated with department’s impacton the business and expressed in financialterms familiar to CEO & CFO
• Law department needed metrics to showwhere bottlenecks in contracting processactually were
• BC team created a workflow thattimestamped every interaction during thecontracting process
• Bank needed metrics to determine howdifferent settlement strategies impacted totalcost of resolving cases
• BC team designed the metrics, tracked thedata, and optimized the strategy to reducecosts of resolution dramatically
CONTRACTLIFECYCLEMANAGEMENT
Management &Compliance
Negotiation& Terms
ContractGeneration
Common Challenges
CONTRACT LIFECYCLE MANAGEMENT SOLUTIONS
Challenge Potential Solution Elements Roles
Contract Generation • Compliant contract templates• Approved terms library• Automated contract assembly• Click accept infrastructure/eSign
Lawyers: Contract drafting, client training, escalationhandling & quality control
Operations: Automation strategy, process andworkflow, & data analytics
Contract Negotiation • Streamlined contract templates• Negotiation playbooks• Automated routing, escalation, &
approval logging• WIP management tool
Lawyers: Contract drafting, risk assessment, playbookdevelopment, escalation handling & quality control
Operations: Automation strategy, process andworkflow, knowledge banks, & data analytics
Contract Storage &Management
• Contract repository• Reporting structure• Event-based alerts (e.g., notice that 30-
day price escalation window isopening)
Lawyers: Input into report structures and systemrequirements
Operations: Automation strategy, process andworkflow, knowledge banks, & data analyticsLiaise with Compliance
CASE STUDY:RED ROBIN
The Client• Publicly traded, fast casual
restaurant with 400+ locations
• New GC who needed to develop credibility with business andboard
The Problem• Contracts taking too long and costing too much to complete
• High risk and no risk contracts being treated in same fashion
The BC Solution• Categorize contracts by risk level
• Streamline process to make no/low risk contracts self-servicewhile focusing legal resources on high risk agreements
• Develop playbooks with “good,better, best” fallbacks toaccelerate negotiations
• Store contracts in modernrepository to facilitatemanagement
RED ROBIN’SCONTRACTINGPROCESS CONT’D
The Team• Cross-functional team of attorneys, paralegal, MBAs,
software developer and project manager
• Red Robin provided attorneys and businesspersonnel
• Bryan Cave provided attorneys and paralegals
• BCXponent provided MBAs, software developers andproject manager
Results• >90% of contracts now completed within target
timeframes
• 100% of high-risk contracts handled in compliantmanner & within agreed risk tolerances
• Law department’s reputation enhanced withincompany
“The system made iteasy for the business
to do the right thing. Ithas created a newdialogue between
legal and thebusiness.”
- Michael KaplanGC, Red RobinInternational
Case/Task Assessment• Cases and/or tasks treated
generically regardless ofcomplexity/risk
• Data not reviewed regularly todetermine what can
Optimizing Assignments• Cases/tasks not assigned to
most efficient resource• Assignments unclear creating
risk of things falling throughcracks
Data• We don’t have the data we
need• We can’t see our data in ways
that are useful• We don’t act on the data we
have
Communications• Firms keep reinventing the
wheel• I can’t get the information I
need• We keep getting sued for things
that should be preventable
SERIALLITIGATION
Challenge Potential Solution Elements Roles
Assessment • Checklist for classifying cases/tasks• Closed-loop processes for evaluating
data and acting on it• Case intake and management system
Lawyer: Risk assessment, classification schema
Operations: Automation strategy, process andworkflow, & data analytics
Assignment • Dedicated teams with optimized mixof paralegal, associates & partners
• Case management system• Workflow• Closed loop process for evaluating
data and acting on it
Lawyer: Optimized legal teams
Operations: Automation strategy, process andworkflow, & data analytics
Data • Work product banks• Case management system• Supporting processes & workflows• Metrics & analytics
Lawyer: Legal work product; metrics input
Operations: Automation strategy, process andworkflow, knowledge banks, & data analytics
Communications • Communication strategy• Knowledge banks• Case management system• Closed loop processes
Lawyer: Input into communication strategy; contentfor knowledge banks
Operations: Automation strategy, process andworkflow, knowledge banks, & data analytics
CASE STUDY:LARGE FINANCIALINSTITUTION
The Client• National Financial Institution facing flood of litigation stemming
from financial crisis
The Problem• Urgent need to reduce costs dramatically• Diverse portfolio required different solutions for low-risk and
high-risk cases
The BC Solution• Set up single system for managing all cases and collecting
data• Run every new case through front-end assessment to
determine its nature and complexity– Defined set of criteria used to evaluate cases– Evaluation done by combination of humans and machines– Evaluation repeated periodically to confirm that initial assessment
still on point
• Route cases to optimal mix of resources based on nature ofcase
• Store all data in system and analyze it to– Further refine classification and assignment system– Improve litigation strategies– Improve settlement strategies
CASE STUDY:LARGE FINANCIALINSTITUTION CONT’D
The Team• Cross-functional team of attorneys, paralegal, MBAs,
software developer and project manager
• Institution provided legal operations support; projectmanagement goals, litigators managing portfolios ofcases
• Bryan Cave provided attorneys and paralegals
• BCXponent provided MBAs, software developer andproject manager
Results• Client’s litigation costs reduced by 2/3
• Outcomes at least constant if not improved
• Generated numerous best practices around knowledgemanagement, staffing models, settlement strategies,etc. that now get leveraged broadly
• Identified and managed emerging legal theories andadopted common strategies for repeat claims types andcounsel
COMMON THEMES
Change is Hard (but it’s worth it):
Need to carve out time to focus
Invest in process
Invest in content
Capture and analyze data
Be entrepreneurial – take risks and fail quickly
Don’t let the perfect be the enemy of the good
QUESTIONS?
Katie DeBordChief Innovation Officer
303 866 [email protected]
Chris EmersonChief Practice Economics Officer
314 259 [email protected]
Doug ThompsonManaging Partner, Los Angeles
310 576 [email protected]