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The emerging disruptor: the legal operations team

The influence of technology in disrupting the traditionally conservative legal profession and shaping our future as in-house lawyers continues its inexorable momentum forward. We’ve been highlighting this trend on this blog in the last few months (see in particular: The rise of the machines: new technology and its impact on the professionsHow in-house lawyers can become “digital” lawyersThe Tech Express: time to jump on board, say lawyers; and How to identify, acquire and implement the right technology for your legal department).

It is always worth taking a look across the Atlantic to see industry trends. My attention was drawn this week to a recent article written by my US-based Thomson Reuters colleague, David Curle, which heralds the role of corporate legal operations teams as key drivers of change in the legal profession. This goes considerably wider than the focus on disruptive and game-changing technology, concentrating on the importance of new forms of human capital within or adjacent to the corporate legal team.

Curle’s article was written off the back of the Corporate Legal Operations Consortium’s (CLOC’s) CLOC Institute event in Las Vegas last month.  The virtually-exponential growth of this annual event from a small handful of attendees in 2009 to about a thousand this year alone tells us something transformational is going on.

Power in the industry is moving rapidly to the buy side, and it is focusing on tools — data, technology, supply chain management, workflow and knowledge management — in the hands of technically-proficient legal operations professionals who really know how to use them.

These people are not generally lawyers and the tools they are procuring and then using underline the evolving competitive pressures now facing external counsel as they try to stay relevant and maintain margins. Cheaper professionals and alternative legal service providers (ALSPs) are increasingly in the game.

So, will this assortment of professionals, composed largely of non-lawyers, continue to increase their influence in transforming in-house legal practice?

On numbers alone, it would seem so.

In a 2016 survey by the Association of Corporate Counsel, it emerged that 48% of legal teams now have legal operations staff, double the figure in 2015.

And a clear sign that CLOC members and their like are becoming a highly influential and ambitious force was the “Big Thinkers” session at CLOC Institute. This drew together speakers from corporates, firms, law schools, regulators, ALSPs, and technology providers to lay the foundations for a “Magna Carta” of key legal operations industry principles.  These principles are designed to enable CLOC professionals to drive change and reform in the legal profession while recognising and addressing the fallout and grievances that rapid change will bring to stakeholders. As Curle explains, these principles embody the values of inclusiveness, ambition and influence.

Curle observes the threat that the rise of legal operations professionals provides to the law firm-centric worldview.  Many in-house lawyers carry this traditional perspective with them following years of experience gained in private practice and this may date quickly.

On the plus side for more traditional in-house lawyers, in-house legal departments hold the trump cards right now, a simple case of “follow the money”. Most of the money in the legal industry originates from corporate legal budgets. But CLOC’s members will be increasingly bringing weight to bear on how those budgets are spent.

CLOC launched a European chapter in February, led by VMWare’s vice-president and deputy general counsel for worldwide legal operations, Aine Lyons.  We can therefore expect to hear much more on this subject on this side of the Atlantic in the months and years ahead.

Rob Beardmore

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