A Call to Arms

January 1, 2005

In-house lawyers should be a hugely influential constituency whose voice should carry enormous weight. But, says Paul Gilbert, their response to date to changes in the legal profession has been decidedly underwhelming

In the space of the last ten years in-house lawyers have raised their profile by a significant and important degree.

Many are prominent in the profession and many, especially those who are influential purchasers of legal services, express opinions that carry considerable force.

So, if asked, what would today’s in-house lawyer say was wrong with legal services in the United Kingdom? I would guess, reading from some of the comments that routinely appear in the legal press, that they would list at least some of the following:

  • Expensive hourly rates in city law firms
  • Poor value for money, especially from city law firms
  • A lack of attention to client needs
  • A lack of innovation and insightfulness on the part of law firms

Some or all of this is fair comment, but it also suggests that all the problems lie with law firms and I do not believe that to be the case at all.

Of course, expecting law firms to openly criticise their clients is very difficult, but I now spend at least as much time with law firms as I do with in-house lawyers and some of the problems I see lie much closer to home for the comfort of many who work in-house.

A few criticisms selected at random:

  • Poor instructions
  • An arrogant disregard for the needs of law firms to actually make a reasonable profit
  • An unwillingness to be innovative
  • An unwillingness to make an emotional or practical investment in helping law firms to do things better

And a criticism I would make in addition:

  • A failure to organise an effective response to the significant issues of the day in relation to law reform and technological innovation.

These criticisms essentially fall into two categories, the “small picture” stuff and the “big picture”.

The small picture

We are all familiar with the shortcomings of computers and the standard denial of technological fallibility that is “rubbish in, rubbish out”. The same is true of law firms. Poor instructions leads to poor advice, or at least advice that is less relevant and probably more expensive that it should have been.

There is also a lack of subtlety in the selection of law firms…Someone said to me recently “don’t instruct a $400 an hour law firm with $200 an hour work and then complain about value for money”. In other words select the right law firm for the right level of risk, value and complexity of work.

The point might also be made that far too often in-house lawyers expect something to be done for no cost or minimal cost based upon some ill-defined expectation that there will be work for the law firms in the future that is of value. This is all very well but in a commercial arrangement where law firms have a legitimate expectation that there will be work in the future, regrettably in-house lawyers routinely fail to deliver on either quality or volumes.

The pertinent question to ask therefore is how many in-house lawyers have ever had any formal training on how to select, instruct and manage law firms on a mutual gains basis?

I suspect it is a disappointingly small number and yet this is one of the most important roles an in-house lawyer performs. Too many CPD hours are wasted on ill defined legal updates and far too few on essential skills.

I also wonder how many in-house legal teams request regular and honest feedback on their performance from their law firms? How many in-house lawyers ask their law firms if they can help find the ways to allow the law firm to make more profit but reduce costs? And how many in-house lawyers are interested in helping the law firms they use develop new ideas around service delivery, costs and products.

Many in-house lawyers will think that this is nothing to do with them and it is the unalienable right of a consumer to criticise the supplier if the consumer is dissatisfied (legitimately or otherwise).

My point though is this; corporate clients should get the maximum value they can from instructing any law firm. Corporate clients should also expect that those who are responsible for extracting that value on their behalf would do so as creatively and as intelligently as possible.

Value can and should be given and measured in many ways and in-house lawyers should be the best placed of all to understand how to lead, shape and develop value on behalf of their clients.

The big picture

These are incredible times in the development of legal services.

The convergence of new technologies and a willingness on the part of the Law Society to at least consider deregulating the market has revealed that in fact the market is already remarkably deregulated. Provided lawyers do not hold themselves out as solicitors just about every type of legal service can be given to clients today by anyone, through any entity.

This represents a fantastic challenge to the usual order of things and a wonderful opportunity to seize the initiative by developing and creating new standards of services and new models of service delivery.

In-house lawyers should know better than anyone else what relevant, timely and innovative legal services might mean to their clients. In-house lawyers should know better than anyone the shortcomings in legal services today…and in-house lawyers should therefore be leading the debates on change.

So where are the examples of in-house lawyers calling for change and being prepared to invest their time and energy in driving forward the issues? Where are the in-house departments who are helping their employer businesses to develop a strategic position on the future provision of legal services? Where are the examples of in-house lawyers combining their talents with law firms to energise and diversify development and distribution of new ideas and services?

I know that there are some who are doing so, but there are now perhaps ten thousand in-house lawyers working in businesses up and down the land. This should be a hugely influential constituency whose voice individually and collectively should carry enormous weight.

Yet, to date, the response has been decidedly and in my opinion disappointingly underwhelming.

Now is the time to seize the initiative. Now is the time to make an impact. Now is the time to generate positive lasting change for the benefit of in-house lawyers, law firms and above all for their clients.

In-house lawyers have been responsible for some of the biggest and best developments in legal services over the last ten years. Their contribution to the reputation of the profession and the sophistication of creative problem solving has been incredibly significant. All this however has brought us to the point when our responsibility is to deliver even more.

This might be in the area of personal training and development, where in-house teams have got to realise that their skills are as much in learning to be a good clients as they are in being hard taskmasters of the law firms they instruct.

It is also in maximising the value of services for their clients and therefore in helping to shape a new world of legal services now that this opportunity has undoubtedly arrived.

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