Legal value

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Legal value
ˈliːɡᵊl ˈvæljuː (highly abstract n.)

The contribution to an organisation’s bottom line — as often as not rendered by heading off impositions which might otherwise plonk themselves on the middle line — provided by the legal department.

The dilemma for professional services providers is not providing value — but showing it. It is all very well working tirelessly and unobserved in the clammy penumbra of doubt and risk in which your client’s best opportunities are bathed — but if no one ever sees you, you know, going in elbow-deep to clear that blocked u-bend with your bare hands — how are they to understand the critical difference you make? How is anyone meant know how valuable you are?

The ordure in which commercial eaglets must grope is certainly grim but most of it, beyond its sheer annoying heft, is harmless enough. This is the dirty secret of commercial legal practice: you have to fish around for a while before finding anything worth reporting. Most days you won’t find much worth remarking on at all.

But this is little moment to a busy client: if she sends her top gun lawyers a 90-page indenture and it comes back unmarked — bar “all fine” scrawled across the front page — yet accompanied by a note of costs, do she feel she is getting value for money?

Generally, she does not.

On non-barking dogs and night-times

This is so even though she might be: a dog that barketh not in the night-time bringeth no comfort, even when there is nothing to bark at. On the other hand, no-one wants a yappy mutt who explodes every time a branch so much as scratches against the window. Quelle dilemma: how to demonstrate a positive contribution to the cause without actively destroying value?

We commercial lawyers have developed techniques for yowling ostentatiously during hours of darkness in just the way that makes our master feel better: a furrowing of the brow and a sigh: “this is not market standard, you know”.

And so, we lift a leg and sprinkle a little magic on the offending tree stump. We make our formal corrections, carefully altering no substance — we don’t want to get in the way of business now — but exuding an aura of thoroughness and diligence that vouches safe our client’s psychological safety. You can spot these parenthetical statements, which we call flannel in these pages, by their tells: “for the avoidance of doubt”, “without limitation...”, “whether or not...”, or “notwithstanding the foregoing...”.

Out client can thus put out the night-light and slumber, safe with the knowledge faithful old Rover has pored over the document for her and buffed it to a high, market standard sheen.

Measuring legal value

All this presents quite the predicament to those lawyers whose output and productivity cannot be measured in billable hours. That is, in-house legal eagles.

For those in private practice, it does not matter how counterproductive, petulant or lily-gilding their behaviour is, as long as it brings in fees. Fees, one can measure. Fees, one can bank.

Legal practice management consultants may help by comparing inputs to outputs; devising metrics to predict the optimal amount of defensible literary lollygagging to maximise fee returns, but this will not work inhouse, where lawyers collect no fees. Here, the putative quest is not “to produce legal work product”, nor even “timely, excellent, and great value-for money legal work product”, but to avoid generating legal work product wherever it is not absolutely necessary.

In-house legal departments exist to throttle legal expense.

The problem is, you can’t measure this with metrics or key performance indicators. Unavoidable legal process — customer contract negotiations, things like that — can certainly be streamlined and productionised, but once that is done, the process becomes an operational function, not a legal one, and legal’s contribution to its ongoing success, again, can only be measured in silhouette: how rarely is legal obliged, thereafter, to get involved.

Hence, the best way of measuring inhouse legal value is also by its silhouette: a business may not be able to count the ways that inhouse lawyers cast their magic on its forward health and viability, it certainly can count the ways they are obliged not to: the times they are hindered by the quotidian distractions of the life bureaucratic: the boxes they are called upon to tick, the forms they must fill, the aimless formless meetings they must attend and the number of times they must re-advise the business, or other risk functions, on issues it is, fundamentally, their job to know already.

These “key non-performance indicators” could be counted and presented to the Opco during its weekly stakeholder check in conference call, on an attractive slide, replete with RAG statuses, downward-sloping graphs and Gantt diagrams charting the department’s ascent from formalistic arse-protectionists to a condition of crystal purity, with maximum scope for offering untrammelled, ineffable excellence.

But are they, in any organisation on the planet?

Are they heck, as the Americans say.

See also

• Key non-performance indicator
• Anal paradox
• Flannel
• In your face