What Is Legal Operations?

In the in-house corporate legal department, two sides comprise the whole: legal services with in-house lawyers and the legal operations team. The latter is the business side of processes and technology that help streamline collaboration and workflow. While legal operations manage the technical aspects of legal services, the lawyers deliver the legal services either independently or aligned with outside counsel, based on the complexity of a legal matter.

A law department has a singular goal: protecting the company. This includes a wide swath of legal challenges including intellectual property, fighting legal battles against external parties in alignment with outside counsel, conforming to regulatory compliance, and dispensing legal counsel to company stakeholders.

While lawyers practice the delivery of legal services, legal operations teams practice the business side of law in partnership with others in the company. Legal operations directors collaborate with marketing, finance, product, engineering, procurement, and other departments to target the high-level strategies that make a business grow.
Legal operations is a multifaceted discipline that aims to streamline and optimize the delivery of legal services, ensuring efficiency, cost-effectiveness, and client satisfaction across the enterprise.

Benefits of Legal Operations

The role of legal operations is to bridge the gap between the practice of law and the business operations that support it. By applying principles of project management, process improvement, and data analytics, legal operations professionals strive to enhance the overall performance of legal teams.

A law department fortunate enough to have legal operations realizes an array of benefits. One of the biggest advantages of utilizing the legal operations function is the ability to plan strategically, prepare for challenges and celebrate successes. Managing and mitigating risk becomes a primary goal for legal ops teams, and that challenge is ongoing.

The benefits of implementing a robust legal operations strategy are numerous:

• Increased Efficiency: Legal operations professionals analyze existing processes and identify areas for improvement. By streamlining workflows, leveraging technology, and implementing best practices, they help legal teams work more efficiently, reducing redundancies and minimizing waste.
• Cost Optimization: With a focus on data-driven decision-making, legal operations teams can identify cost-saving opportunities and implement strategies to control expenses. This includes optimizing resource allocation, leveraging alternative fee arrangements, and implementing effective matter management practices.
• Enhanced Client Service: By improving internal processes and communication channels, legal operations professionals contribute to delivering superior client service. Clients benefit from increased transparency, predictability, and responsiveness, fostering stronger relationships and trust.
• Risk Mitigation: Legal operations teams play a crucial role in developing and implementing policies, procedures, and controls to mitigate risks associated with legal practice. This includes ensuring compliance with ethical and regulatory requirements, as well as managing potential conflicts of interest.
• Data-Driven Decision Making: Through the collection and analysis of data related to legal operations, professionals can provide valuable insights to support strategic decision-making. This data-driven approach enables law firms and legal departments to make informed choices about resource allocation, pricing strategies, and service offerings.

Responsibilities of Legal Operations Professionals

People working in legal operations are accountable for a variety of tasks. These include strategic planning; managing legal spend budgets and other financials; vendor recruitment and management; project management; talent recruitment; technology selection; and product procurement either in collaboration with a procurement department or on their own initiative.

Also at the core of the law department is the necessity to deliver value for the overall company. Corporate legal strives to positively contribute and influence the organization’s bottom line. As a cost center and not a revenue center, this is critical. The path to continuous improvement requires nimble and flexible behavior. This can be a struggle in a corporation that resists change or growth.

Legal operations professionals wear many hats and their responsibilities can vary depending on the size and structure of the organization. However, some common responsibilities include:

• Process Improvement: Continuously analyzing and optimizing legal processes, from matter intake to billing and invoicing, to ensure efficiency and consistency.
• Technology Management: Evaluating, implementing, and managing legal technology solutions, such as document management systems, e-billing platforms, and legal research tools, to support the legal team's work.
• Financial Management: Developing and monitoring budgets, analyzing financial data, and implementing cost-control measures to ensure the financial health of the legal department.
• Vendor Management: Overseeing the selection, negotiation and management of relationships with external vendors, such as legal service providers, outside counsel, consultants, and technology vendors.
• Knowledge Management: Developing and maintaining systems for capturing, organizing, and disseminating institutional knowledge, ensuring that valuable information is accessible and leveraged effectively.
• Project Management: Applying project management principles to legal matters, ensuring timely delivery, effective resource allocation, and adherence to budgets and timelines.
• Talent Management: Collaborating with human resources to develop strategies for attracting, retaining, and developing legal talent, fostering a positive and productive work environment.
• Strategic Planning: Providing data-driven insights and recommendations to support the strategic planning process, helping to align legal operations with the overall business objectives.

How Enterprise Legal Management Software Contributes to Legal Operations Success

To function well in a legal department, the implementation of enterprise legal management software provides the core foundation for matter management, workflow and collaboration, vendor management, analytical reporting, financial management with smart billing, work intake, and contract lifecycle management.

In a corporate legal department with or without a legal operations function, enterprise legal management software provides a solid foundation to integrate the aforementioned systems within a single, unified workspace.

Financial Management

Enterprise legal management solutions often have their roots in e-billing software. Financial management is a critical component of enterprise legal management software. It enables legal operations to manage the budget and establish billing guidelines and invoicing rule sets for outside counsel adherence. Moreover, smart AI-powered billing tools enable invoice errors to be flagged and correctly adjusted. Managed bill review services also exist to help with legal spend cost-cutting strategies.

Vendor Management

Included as part of a successful legal operations strategy is a robust vendor management program. This provides the ability to evaluate outside counsel in a side-by-side comparison from hourly partner rates and a win/loss record to the quality of legal services and whether legal teams are diverse. Vendor management dashboards in the enterprise legal management solution provide snapshots of performance. Analytical reporting is also developed as a bonus to department leadership to analyze performance, productivity and hiring choices for outside counsel.

Matter Management

Every legal department requires a case management platform. With enterprise legal management software, the matter management component is the primary element that makes the software collaborative. Lawyers open a matter within the ELM platform and manage every aspect of the matter from within the integrated solution. Moreover, matters are accessible from within Office 365 applications, so there is no hunting or pecking to identify a singular matter.

Contract Lifecycle Management

Often, legal operations professionals can choose to utilize a contract management system that is separate from the enterprise legal management platform. Preferably, legal ops should identify a solution that integrates them both. Contracts should link with matters so lawyers can reduce time seeking files and improve productivity by having a matter with its contract in one location.

Other benefits of enterprise legal management software make the legal operations function more streamlined.

The maturity of a law department depends on a variety of factors that influence the growth continuum toward optimization, efficiency and maximum value. The size of a department may or may not affect its maturity. Each corporate legal department does well in certain areas and poorly in others. Recognizing the challenges and the journey to adjust and become successful helps create a productive and efficient environment that aligns with cross-functional goals.

As the legal industry continues to evolve, the role of legal operations professionals will become increasingly crucial. By combining legal expertise with business acumen, they play a pivotal role in driving efficiency, cost-effectiveness, and client satisfaction, ultimately contributing to the success of legal organizations. Reach us here to learn more about implementing robust enterprise legal management software for legal operations.