Unlocking the power of data: how in-house legal teams can demonstrate their worth

In-house legal departments are delivering value in spades. They know it. The other departments in their organisations they work with know it. Those sitting around the boardroom table should definitely know it. But proving that value in a numerical sense is something many are struggling to achieve.

In the last decade, we’ve seen in-house legal teams make huge strides forward to integrate within their wider organisations by understanding the inner workings of each department, building trust and rapport with their leaders, aligning their goals with those of the business and demonstrating how they can add value beyond the traditional confines of their roles.

But with this increased profile and added responsibility comes mounting pressure to perform and in-house teams are now being pulled in dozens of different directions.

To manage rising workloads, the majority have turned to legal technology for help, but very few are using these tools to prove the value they’re delivering.

Legal teams need to forge a new path by looking beyond the here and now, taking their investment in legal technology to the next level and using it to showcase their real worth.

Communication

One of the biggest fears for in-house legal counsel is being siloed from the wider organisation. If communication is poor, then their internal reputations, budgets and seat at the boardroom table could be at risk.

It is therefore not surprising to hear that, when asked about their biggest challenges, 54 per cent of respondents said communication with the wider business could be more effective and efficient, according to a new report titled: Escaping the legal labyrinth: using technology to demonstrate value. This figure rose to 71 per cent when looking at general counsel alone.

The most obvious solution to this communication conundrum is to increase internal exposure to the wider business. Sitting down with heads of sales, marketing, product, digital and similar roles to advocate the commercial value of the legal team or establishing cross-departmental workshops or project teams to encourage collaboration.

But could this high-touch approach be hindering communication with the rest of the business instead of improving it?

The majority of in-house legal counsel come from a private practice background, where client relationships reign, so many treat their colleagues in the same way they would their clients.

Instead, other departments want answers to their legal queries and they want them to be delivered in a way that does not require a lengthy conversation with a lawyer. That’s where technology comes in.

A great place to start is by utilising the existing technology already used by other departments within the organisation. If legal teams can communicate directly with other teams via already familiar platform(s) or tool(s) there should be little to no pushback or adoption challenges by the business. This may also present the opportunity to generate metrics and useful management information in a format which is already accepted and understood. Using what’s already in place is also likely to be a cheaper and quicker solution to implement than bringing in new technology.

Reliance on legal technology

To manage rising workloads most legal teams have turned to legal technology for help to automate the routine, lower value, lower risk tasks.

The main focal point seems to be centred on increasing productivity and ensuring their lawyers can spend more time on strategic work that makes the biggest impact and best utilises their skills.

'Makes the legal team more productive' was listed as the biggest benefit by respondents in our survey, with just under three-quarters (74 per cent) selecting this as an option. 'Automates simple, repetitive tasks' (54 per cent), 'gives more time to focus on priority issues' (53 per cent) and 'simplifies workflows' (49 per cent) were also popular options.

The majority of in-house lawyers are now reliant on legal technology to go about their day-to-day jobs. In fact, 50 per cent of respondents to our survey said they wouldn't join a company without legal technology already in place.

We also asked our respondents where they see the function of the in-house legal department in the next one to three years and 82 per cent agreed demand for technology skills will increase in their teams, further demonstrating the growing influence legal technology will have on the profession.

The future role of the in-house lawyer is almost inextricably linked with their legal technology – especially when looking at the many exciting opportunities generative AI brings to the table. This means moving beyond the confines of providing legal advice on its own – instead, in-house lawyers can add more value to their organisations by leveraging different resources around them to get more out of them.

Data: the real silver bullet

In these busy and challenging times, it is completely understandable why in-house legal teams have turned to legal technology to increase their productivity in the here and now. But this focus highlights the short-term mindset many have towards the use cases for legal technology which may be stopping them from seeing the bigger opportunity.

In today's business world, data is the real silver bullet. Yet the survey shows very few legal counsel are interested in using data insights from their legal technology to help demonstrate and drive the value they are adding to the wider business.

When asked about the benefits of legal technology, only 17 per cent of respondents listed 'delivers unique insights' as a current benefit of legal technology. In a similar vein, only 26 per cent of respondents listed 'demonstrates results to the business' as a wider benefit and 32 per cent listed it as an opportunity for the future.

I’d wager there won’t be many board or senior exec meetings where data and metrics aren’t presented, interrogated and used in some way to drive strategic decisions. Data is a language businesses understand. Yet our survey shows few seem focused on speaking the same language, putting legal teams at risk of failing to showcase the efficiencies and value they are driving. This seems at odds with our survey findings that effective communication with the wider organisation is a key area of concern for in-house legal counsel.

Emma Dickin is the head of in-house practical guidance at LexisNexis lexisnexis.co.uk