What is a ‘strategic’ approach in-house?

Picture this – an in-house lawyer arrives at home or the pub and, variously, is asked by family, partner or pub chum how their day was. ‘Strategic, really good… fairly epic to be honest’ the lawyer replies, eyes shining with job satisfaction – rather than the hassled default answer, ‘busy! Where’s the wine?’.

Being ‘strategic’ is assumed to be a bit of a holy grail for in-house legal departments.

Legal heads from Tyco and DuPont to Treasury Solicitors have at variously claimed to have outsourced the legal work that can be ‘commoditised’, bringing ‘strategic’ work in-house. Getting rid of the humdrum freed them up to do the big, interesting stuff.

But when legal is mostly broken down into a series of narrow cognitive tasks – ‘disaggregation’ to use the nasty, yet strangely helpful, phrase – what on earth is meant by strategic?

Should it get a module in the LPC? Would trainees benefit from one of their seats being strategic – rather than property, say? Where on the system would I find a precedent bank for strategic work? It’s a bit simpler in private practice, where the lawyer produces the business’s leading product. Strategy might be to expand abroad, to win more business from fewer, core clients, to ditch one area of work, and do more of another.

In-house it’s not that easy. The waters are also muddied by counsel who believe/say their role is strategic, but actually mean they are just no longer the most junior lawyer in the team.

In some departments, it’s probably fair to add the words ‘high-value’ in to the box marked ‘strategic’.

Strong feedback from in-house lawyers working for government and unions is that this means handling the work on litigation that the organisation has decided really matters.

Good lawyers are motivated to join TSol or HM Revenue & Customs, often on remuneration that doesn’t match that available in private practice, on the promise that they will consistently be dealing with the sort of cutting-edge public law cases that make headlines and changes people’s lives (for better or worse, depending on the result).

At unions, in-house lawyers hope to make case law through employment claims – results that are central to the union’s aims. For comparatively lean departments, that’s not possible if the in-tray is packed with a combination of routine and low-value work.

Professionals like to think that they are not just ‘reactive’ – but facing things that ‘need’ to be done, it can be difficult to operate on any other basis. In businesses, then, the ability to identify and manage risk is the reason to create space.

That ‘space’ may be created by outsourcing those low-value items, or by enabling non-lawyers to complete ‘legal’ work safely, through standard contracts, or permission to vary terms within certain bounds – even FAQs that cover the queries that routinely take up lawyer time can be effective.

In their place should come effective risk management. That might involve the compilation, and maintenance, of a risk ‘heat map’ for the business – which when set aside legal advice coverage should show up where too much legal effort and expence is being used, and even more importantly where resource allocation does not match the risk.

There is also ‘horizon scanning’ to be done – keeping tabs on the legislative, regulatory and case-law events that could impact on the business’s ability to operate as it would like. A small but growing number of legal heads have some responsibility for public affairs, and the ‘added value’ from attention here is rather obvious.

Finally, there are the items which may not feel like ‘law’ at all. I’m thinking here of examples like the general counsel at a fund manager who led its assessment of the consequences that a Greek exit from the eurozone would have on the business.

The eurozone analysis may feel like an indulgence, given a full legal matters in-tray. But it makes perfect sense. Understanding the broad business risks the organisation faces can inform work on its risk ‘heat map’, help tailor advice to other teams – and improve the legal team’s authority, and therefore its ability to get heard, rather than be dismissed as the ‘business prevention department’.

Being ‘strategic’ is a demanding route – what’s outlined above is much, much easier said than achieved. But, those who manage it all report, it’s a lot better than being merely busy.

Eduardo Reyes is Gazette features editor