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Perspectives
Executing on the in-house legal department’s strategy
Are in-house legal teams highly effective at executing on their top priorities? Not always, say chief legal officers (CLOs)—but their direct reports may see it differently. Explore this and other findings about executing on the CLO agenda from our recent survey of 100-plus legal executives across the United States.
What are the key areas of focus for CLOs? Is it managing cyberthreats, navigating regulatory changes, or crisis response planning? In today’s dynamic marketplace, many challenges and opportunities confront the CLOs. However, the effectiveness of their teams in executing these priorities can often be a cause for concern. Despite the challenges, legal teams have the potential to emerge as influential business advisers. Our survey findings offer insights into difficulties and possibilities that in-house legal teams encounter and underscore the importance of aligning team capabilities with CLO goals.
CLO priorities versus team effectiveness
There appears to be a disparity between the priorities established by the CLOs and the ability of their teams to execute on these. The top priorities for CLOs include management of cyberthreats, navigation through regulatory changes, crisis response planning, identification of ethical concerns regarding technology, and effective communication with stakeholders. However, their teams are less effective in implementing remediation programs, managing cyberthreats, and navigating regulatory changes. A revelation from the survey is the apparent disconnect between CLOs and their direct reports when assessing the effectiveness of their legal teams. But what’s interesting is that CLOs are more likely to say legal is highly effective at identifying technical ethical concerns.
Interdepartmental struggles
The survey revealed that legal teams face substantial challenges within their own departments, pointing to internal barriers. One of the primary struggles encountered is the automation of processes. In an era where technology is a key driver of efficiency, legal teams often struggle to fully automate their operations. Moreover, legal teams grapple with the use of technology to alleviate bottlenecks that can significantly slow down productivity. While technology offers promising solutions to identify, manage, and eliminate these bottlenecks, legal teams often find it difficult to implement and leverage them effectively. Implementing technology for a competitive advantage is another area where in-house legal teams face hurdles.
These struggles could be attributed to a multitude of factors, including budget constraints, lack of technical expertise, or an unclear understanding of how technology can be strategically deployed. They also highlight the need for legal departments to not only foster a culture of innovation and agility but also invest in technology training and infrastructure.
Legal teams as business advisers
Despite these challenges, the CLOs believe their teams are effective business advisers. They are particularly adept in navigating regulatory change, classifying risks to the business, using data to inform business decisions, understanding the complexity facing business teams, and building trusted relationships with teams outside the legal function. These strengths underscore the potential of legal teams to provide valuable contributions to overall business strategy and operations.
Impact of company size
The survey results showed that the size of a company can influence the effectiveness of legal teams. Companies with an annual revenue above $5 billion are more likely to believe that their legal teams are effective at classifying risk and meeting the growing demand for legal services. In contrast, companies with annual revenue between $500 million and $750 million have more confidence in their legal teams’ abilities to engage with the business throughout the product life cycle and to employ technology to alleviate bottlenecks.
Bridging the gap
It’s important to remember that these industry breakouts are directional and not based on qualitative data. As such, they should be interpreted with caution. The survey provides valuable insights into the challenges and opportunities faced by legal teams and underscores the importance of aligning team capabilities with CLO priorities to achieve business objectives.
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