Now perhaps more than ever, governance and legal teams are being asked to do more with less. By automating recurring and routine tasks, you empower your team to focus on more strategic initiatives, and in doing so, you also create a competitive edge. In a 30-minute speed learning webinar held on Tuesday, 8 June 2021, moderator Matthieu Chollet, Regional Sales Director for France from Diligent was joined by speaker Luc van Daele, Owner at Legadex to discuss the ways that companies can boost operational efficiency and collaboration among dispersed teams; ways legal teams can become more strategic and claim the business advisor role; and how to use Alternative Legal Service Providers (ALSPs) and legal-tech to help achieve your company’s goals in a post-Covid economy.
Mr. Chollet began by posing a question to Mr. Van Daele: now that legal and governance teams are asked to do more with less, what concrete steps can they take to become more efficient, and can you give some examples of this?
Mr. Van Daele stated that what they as a company have seen over the past year is that often, legal departments are facing budget restrictions, sometimes even budget cuts. And within those restrictions, they need to keep their ongoing services in place, which is already a challenge. He continued by stating that at the same time, things are changing all over, with additional burdens being placed on them and leading them to question how they can manage strategic repositioning and be future proof as a legal department. This poses a bit of a struggle for legal departments, but he claimed that by taking the right steps, you can certainly overcome those challenges.
He also stated that there is quite a lot of room for manoeuvring here as well, if you get your base processes organised in a more efficient manner and save time and money in this respect. If you do create those efficiencies, you also create some room to manoeuvre in making investments in time and money to become more future proof. It will also enable you to catch up with all the developments in terms of the way that you are working. However, he pointed out that there is a lot of room for improvement for a vast majority of legal departments when it comes to this.
To illustrate this more clearly, Mr. Van Daele used his company Legadex to provide two examples. The first example is on work they have been doing on an investment fund where they currently implement legal entity management and contract management in a very detailed manner. They additionally give advice and support to ensure that it works well for them from the start, and that it can save time, money and improve the quality of their services as well as reporting. The second example is of a large corporate legal department that is active worldwide. He explained that they are now outsourcing to Legadex, which is a complete international and legal entity management to Legadex’s management and services team.
So, on the one hand, he stated you have companies that say they will become more efficient and work well, while on the other hand, you have companies that think that it makes sense to outsource a piece of that recurring work. This then gives them an opportunity to give their attention to other parts of the business and to support their business in a more proactive manner.
The Entity Governance Maturity Model
Mr. Van Daele further stated that he believes that the use of legal technology has to do with a model known as the Entity Governance Maturity Model. Mr. Chollet then explained the four stages of the model, which are centralisation, collaboration, self-service, and automation. The first stage is centralisation, which is about creating a single source of truth. Organisations will see and act on the opportunities faster if all their departments are drawing data from the same data well. He went on to state that the second stage is collaboration where you want to unite the business units. Your entity management system should support data collection, visibility, oversights, and collaboration across all enterprises.
The next stage is then self-service where Mr. Chollet stated that the goal here is to make entity information easy to find for everyone, with operational efficiency being key. The final stage is then automation where you allow it to do the work for you. He also said that automation makes a company more efficient at strategy and allows them to deliver more value to the board of an organisation as well.
He then asked Mr. Van Daele: in your opinion and with this model in mind, what stage are most European companies at?
Mr. Van Daele stated that he believes that many companies are at the stage of centralisation and to some extent collaboration, and that that are still far away from reaching the stages of self-service and automation. He continued by stating that the way that they approach this at Legadex is to take it step by step. So, the first step would be to determine if you have all of your information. For example, do you have everything digitised and placed using clear folder structures? The next step is determining whether you can share the information and make it accessible to your stakeholders within your legal department, finance department, etc.
Then, as he stated, you reach collaboration and workflows where you need to question: do we work well together, and in what manner do we work together? So, in short, Mr. Van Daele said that most companies remained stuck at the first two stages. But when you arrive at self-service, work allocation, outsourcing work, work on the basis of templates, etc, this is still currently in the early stages of development for most companies.
Legal departments – supporting the workflows and becoming more proactive, strategic, and managerial
Next, the speakers discussed ways that legal teams can become more strategic and claim the business advisor role. Mr. Chollet then asked: what steps or models should legal teams follow to get from where they are now to where they want to be?
Mr. Van Daele stated that it depends on what your entry point is. However, he mentioned that two points will certainly count in this regard for many legal departments. One is budget and the second is the ways of thinking and working. Legal is also a very traditional type of business, which often means that its lagging behind quite a bit in picking up ways of working, leveraging technology, and on working together with other departments. He continued by noting that the key challenge in his opinion for legal departments in the near future is on catching up and showing within an organisation that the legal department is future proof.
He also acknowledged how this would require alternative methods of working with using technology in a step-by-step approach to support the workflows and to do it in a cleverer manner. And if you achieve in accomplishing this, it will also create room for yourself – as general counsel or legal operations manager – to play a more strategic and proactive role in the company, which is what it all leads to. Furthermore, he stated that legal departments become more managerial and find better ways of working, not only to create efficiency and save costs, but to also work in a more pleasant manner.
The following question from Mr. Chollet was: do legal teams need to become more strategic or is it simply a hype?
Mr. Van Daele replied by saying that based on their experience at Legadex with their clients, it is certainly not a hype. However, he observed that there is increasing pressure on legal departments to deliver more in terms of thinking with the business and coming up with good solutions to support the business. Over the last year, especially with the pandemic, CFO and CEOs have seen that it is possible to work in other ways such as working from home and using other different platforms and technology, for example. For legal departments, he stated that it is essential for them to think about this and make a plan, otherwise they will end up in a reactive role when they can and should play a more strategic and active role in supporting the company.
Six steps for a business to consider when making an investment case
Both the moderator and speaker then moved into the final part of the webinar, which was about the use of Alternative Legal Service Providers (ALSPs).
Mr. Chollet: what should legal teams consider when arguing for investment in pay for innovative legal delivery?
Mr. Van Daele stated that in a whitepaper distributed by Legadex, they have defined six key steps to consider when you make an investment case, typically to a CFO. This could have to do with an investment in tech solutions, internal resources, external resources, etc. You would essentially make an investment case in whatever you want to achieve as a company, which also means that there needs to be a clear plan behind supporting such an initiative.
This is where the six steps highlighted in the whitepaper become relevant, which he briefly listed:
- List your issues: this is your starting point. You have to think about your legal department and then consider what to do, who you have and how to work.
- Develop your strategy: this is where you have to think about how you are going to go about doing the work and what needs to be done. In this step, he stated that you also have to consider what templates you can use to improve your services, what systems you have and whether you need to currently change anything in those systems.
- Make choices: don’t try to do everything. He noted how it is sometimes better to leave something to the company or choose not to go through with something at all.
- Analyse your current cost and spending: this will be required when you make any business case.
- Create financial room in your budget; and
- Keep analysing your legal spending going forward: you also have specific legal tools to help you keep track of your internal and external costs to get an overview of your costs from a financial perspective.
Conclusion
Mr. Chollet then concluded the webinar with one final question: what kinds of benefits can legal teams expect to see from the use of legal-tech and / or ALSPs?
Mr. Van Daele stated that what Legadex does often is to give good advice and benchmarking to legal departments. Due to the fact that Legadex works for so many legal departments, they generally have a very good idea of all the possibilities and what technology makes sense for them to use depending on the stage they are currently at. So, this is very much in line with thinking with them and helping them with ensuring that it’s quickly implemented. Another element to this is to have your ongoing work under control, and to keep it under control. Lastly, creating solutions for major efficiency and quality gains for legal departments is also a crucial element that he mentioned – whether they do it themselves or outsource it partly.
