In-house ACCess : In-house ACCess: Association of Corporate Counsel : ACC : The In-house Counsel Bar Association

I recently attended a workshop at my son’s preschool where we learned some of the principles of Conscious Discipline^®. This multifaceted approach to managing conflicts is followed in numerous schools and by many parents, and I won’t attempt to do it justice by summarizing it here.

But there were three key takeaways I gleaned from the workshop: 

(1) establish a loving bond with your child;

(2) empower your child to make his or her own decisions by offering reasonable choices; and

(3) use an assertive but respectful voice in communicating limits.

I was quickly struck by the parallels between managing conflicts with children and serving as what I consider to be a “business-focused” in-house lawyer. Mind you, I’m not suggesting that my clients act like 3-year-olds. (Although it is tempting to make a joke about that.) At a basic level, however, both situations draw on principles of emotional intelligence such as understanding and relating to your audience and tailoring the message accordingly.

1. Establish Meaningful Relationships with Clients

Meet with your business contacts in person or phone them if you are not close by. Meeting or talking in person remains the gold standard for professional networking. Even if you don’t work in the same physical office as your internal client contacts, there are still plenty of opportunities to build relationships. When you travel to corporate headquarters, make plans to meet key clients. When you encounter a new contact on the phone, introduce yourself and give a brief overview of your role within the company before diving into substance. If your business contacts are active on social media, get to know the platforms they’re using and seek out opportunities to link, “friend” or follow them. It’s about relating to clients outside the context of providing advice on a particular legal issue, and building a rapport that can be drawn upon when a specific communications need or conflict arises.

Because the in-house lawyer’s true client is the company rather than the individuals acting on its behalf, the importance of relationship building also extends to the company itself. What is the company’s position within its industry? What are its unique competitive differentiators and goals? What does it hope to accomplish in the near and long-term? Understanding the company-wide perspective and the individual goals and needs of particular contacts can help in-house counsel tailor legal advice more effectively.

2. Offer Reasonable Alternative Choices Instead of Just Saying “No”

No one likes the lawyer who just says “no.” In fact, it’s rare that a legal problem is truly black and white. You can get creative, suggesting alternative courses of action that will still accomplish key objectives with a lower level of legal risk. You can help business contacts problem-solve by presenting two or more options that would address the legal issues you’ve identified; communicating the anticipated benefits and risks of each option; and then allowing the client to choose between them.

3. Be Aware of Unspoken Messages Your Tone May Convey

At the workshop I attended, we were advised to use a respectful but assertive tone, rather than implicitly asking the child’s permission to impose limits (“do you want to sit down for dinner now?”) or being overly bossy (“Get yourself to the dinner table “RIGHT NOW!”).

Language also is critical for the in-house lawyer. Take a few extra minutes to explain the rationale behind your legal advice, and be sensitive to the tone of your written and spoken communications. Using an affirmative, clear and constructive tone (“I recommend doing XYZ to address the risk of ABC”) inspires confidence and invites cooperation. Using tentative language, on the other hand (“maybe you should do XYZ?”) suggests that you’re not sure about the advice you’re giving. Conversely, using an overly aggressive or condescending tone that cuts off further discussion (“you need to do XYZ or you’ll risk ABC”) is often counter-productive.

I’ve found these principles and techniques to be very helpful in conveying to my in-house clients that I’m a part of the team, one who is in a unique position to provide legal advice on a proposed course of action and who also shares the goal to accomplish the company’s objectives while also ensuring there is no unacceptable level of legal risk.

As for successfully navigating conflicts with my preschooler — well, that’s a work in progress.

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The power of project management

Week 10. Each week via the In-house ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

First year efficiency gains in the trademark portfolio require that we know our starting point. To know our starting point, we must have our arms around 3,600 trademarks, all moving at their own pace. That requires a seamless transfer of 3,600 trademarks to Seyfarth, and that requires excellent project management. 

Let me talk about the Wolverine side of that equation. There are four of us who day-to-day touch the trademark portfolio. The old school way consisted of lots of e-mails, hallway chats, catch-up meetings and follow-up e-mails. We kept the ship running but it didn't look pretty. This transition brought us the opportunity to upgrade.

We established a several month transition schedule, rolling from our less complicated brand collections of trademarks to our most complicated collection. Approximately every two to three weeks, another brand moves to Seyfarth. Every week, we have a WebEx conference for the Seyfarth and Wolverine team. Using one of Seyfarth's project management tools, we work through (1) transition status and issues, (2) portfolio issues for the brands that have moved, and (3) general issues affecting the portfolio. The online tool lets us systematically work through each issue, coded using several criteria including importance and due date, to update the team. Since it is something we all can access at any time, the call gives us a chance to quickly identify any needed action items. We don't resolve many of them in the call - they are put on the list for separate in depth calls as needed. The call takes one hour, but keeps everyone on top of the issues.

Separate calls are scheduled, including one regularly scheduled call each week between Seyfarth's lead attorney and our lead paralegal, to cover in depth some of these issues. We have other ad hoc calls (and some e-mails) as needed. This sounds oh-so-straightforward and it is, but that is because the groundwork for a well-run project management process was put down by Seyfarth long before we darkened their doors. Oddly enough, I used a similar process some 16 years ago in the early ages of computer video conferences. The key here is that, while Seyfarth's implementation is much more elegant than the old version I did, the concept of project management isn't new and doesn't require huge amounts of time. In fact, properly done project management will significantly reduce the time it takes to keep things on track versus the ad hoc method we used and many of you may still use.

Another factor here is constant improvement. Each week the Wolverine/Seyfarth team improves the process management process.  We are handling more brands and issues as they transfer to Seyfarth, but we still do so in an hour or less. We also have started the real lean process - the team held its first process mapping session last week. Through a WebEx, team members from both entities started mapping out the process for trademark searches. This is the first step in defining what we do today to give us that springboard for improvement. Just as we break complex legal matters into manageable pieces to solve the legal challenges, we are breaking this complex portfolio project into manageable pieces to handle the transfer and start "leaning" the processes. 

Next: Strategy tools - how to get there by knowing where there is.

The firm view

From Lisa:

We have been pleased and excited about the reception that Ken and his team have given to the various project management tools we have adapted for our trademark practice. Ken's strong interest in Lean and his focus on the creation of a value relationship dovetail well with a number of previous projects we have undertaken to improve our global trademark portfolio management practices and file transition procedures.

We began our Lean trademark journey a little over a year before we met Ken, when the firm was already well into its larger adoption of Lean. The driving force behind the Lean trademark program was the perception that traditional law firm trademark practice, like many areas, contains various inefficiencies that increased cost and wasted time (increased "pendency" in our nomenclature). The net result? Ad hoc decision making and a focus on fighting day-to-day fires, at the expense of strategic thought and action. We tried to attack these problems through a combination of process standardization (we have "process mapped" ten standard tasks within the trademark practice), project management approach, and the development of new technology tools to improve client communication, collaboration and information management in the trademark practice.

As with any development project, the path wasn't always completely clear, and we made some mistakes before joining forces with Ken. In one case, we created a standardized process for a task that had previously been only loosely coordinated among various team members. After about three months, however, we realized that the new standardized process actually increased our cost and the time spent on that particular task -- costs that the firm absorbed as "R&D" for the program. After that experience, though, we developed "version 2.0" of that process map. Ultimately, we reached a solution that was an improvement over both version 1.0 and the prior practice.

We've also benefited greatly from our interaction with Ken's team. As we began to implement our trademark extranet product for Wolverine, Ken and his team were not shy about guiding us as to how the tools would best work for them. Ah, the power of feedback!

We then customized our platform in a manner that's actually much better than the original. Our experience reflects a critical point about building a relationship: Providing value and efficiency can't be a one-way street. While we have brought some innovative tools to the table, Ken's team has been extremely engaged in the implementation and adaptation of them. They have given us valuable feedback along the way. Had it not been for the level of engagement from Ken's team, the implementation would not have been as effective. That's where genuine partnership in the relationship becomes essential.

For those of you using project management tools in your practices, what is working? How has the collaboration been between in-house and outside counsel? What tips for success can you share for the benefit of others?

Next: Continuing the transition and working toward development and implementation of an effective strategy.

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Balancing strategic roles and tactical delivery

Week 8. Each week via the In-House ACCess blog, follow the promise and pitfalls of forming a new value-based client-firm relationship. ACC Value Challenge steering committee member Ken Grady, General Counsel and Secretary of Wolverine World Wide, offered to profile his selection and start-up process of launching a trademark portfolio management engagement with law firm Seyfarth Shaw. Ken's co-blogger is Lisa Damon, a member of Seyfarth's Executive Committee and leader of the firm's efforts to incorporate Lean Six Sigma into its business. The voice, views and stories expressed by the authors below are their own and not ACC’s. To catch up on the story so far, click here.

The client side

From Ken:

Lisa and I have been talking about the role of outside counsel as we discuss this burgeoning relationship. I suspect this discussion is controversial, because to some in-house counsel it sounds like a threat. It has taken decades for in-house GC’s to evolve into their current role as valued senior executives. Not long ago, the GC’s role was to channel work from inside to outside. Why should GCs now invite outside counsel to sit at the table and potentially drain away that power? In the context of these posts, why should I invite Seyfarth to sit at our table?

The answer is more complex than a 500-word blog post will allow, but here is my quick take on it. A good GC, and increasingly a good global GC, should emulate many of the same behaviors as good global CEOs. Good CEOs consistently recognize that their companies benefit by having many minds at the table. Their personalities help them channel those minds to achieve goals more effectively than each CEO could do through his or her own efforts. With an ever-expanding regulatory environment, business models increasing in complexity, and black swans circling just out of sight, even GCs of relatively simple businesses need that collective power working through the risks their clients face. 

I think some GCs feel threatened that having outside counsel at the table will result in the CEO seeing the outside counsel as the true advisor. More effective GCs will overcome this hesitation and have confidence in their own abilities, in their relationships with their internal team and with outside counsel. Outside counsel who have a weak relationship with the GC or who have interests that are poorly aligned with the company’s interests won’t be good partners and may show that the GC’s fears were well-founded. That, to me, is another reason why I want to spend the time building a strong relationship with outside counsel and why I want a fee relationship that aligns interests.

Another way to think about the goal of a value fee relationship is to compare it to the compensation structure for senior executives (beware the metaphor). In simple terms, a well-constructed compensation structure should, among other things, (1) align the interests of the senior executives; (2) align the senior executives’ interests with corporate goals; and (3) provide clear rewards for achieving well-defined goals. Since my outside counsel are an extension of the in-house team, I would like to see our interests aligned, I’d like to have our outside counsel’s interests aligned with our corporate goals, and I’d like to provide them with clear rewards for achieving well-defined goals.

So, Seyfarth and I are talking about Seyfarth’s role at the table. This means drawing them into the strategic discussions with our internal business partners, but it also means understanding that their fee drives off that strategic work. In linkage terms – our portfolio is a risk management tool and a strategic tool. We tend to understand the risk management piece, so now we are working on the strategic piece – how do we tie Seyfarth’s role to the in-house team’s role to our corporate strategic objectives.

Next: Tying in some of the messy accounting stuff.

The firm view

From Lisa:

As Ken notes, one of the roles of outside counsel in delivering value must be that of strategic business advisor. Done right, we know that this advisory role can both complement and strengthen the GC’s position with his or her executive leadership. While Ken, or his GC counterpart at another company, will always know the organizational issues, context and culture better than we as outside providers, our very exposure to a host of different clients, with a range of risks and risk management strategies, may put us in a very good position to round out the GC’s and legal team’s analysis. We can bring a depth and diversity of perspective to the GC’s table, fully participate as a team member, and add value at the highest level.

While these strategic role discussions continue, we also have to manage the other half of the value equation -- the ‘industrial role’ that Ken referenced last week -- and get things done quickly and efficiently.

For our weekly readers, you may be wondering what we have been up to on the ground? Well, a lot. To date, we’ve transitioned six of the Wolverine brands, or about one sixth of the company’s portfolio (roughly 600 of a total 3,500 marks). And, working with Ken and his team, we’ve done this rapidly and efficiently in less than 60 days.  

Because Wolverine’s trademark assets are central to the company’s business, we knew the transition process had to be delivered on-time, on-budget and on expectation. We have been using project management resources to help us get the job done. As we have adapted lean six sigma to the world of a law firm and its clients, project management has been a key component of what we have implemented. We combine it with a set of Lean tools and disciplines but we rely on our client-facing project management office to help drive our internal and external teams.

There are a number of successful ways to apply project management skills and tools to legal work, such as those identified by LegalBizDev blogger Steve Barrett (link to: How Should Law Firms “Gear Up” to Manage Projects Better? – A 50,000-foot View (Part 2 of 2). For our work with Wolverine, we wanted our project management role to play an integral and strategic role in delivering client value and help drive the success of our relationship:

·       Program Management: To begin the transfer process, Wolverine provided us with an initial schedule, which served as our foundation for development of a high-level timeline and accompanying detailed project plan. To ensure we stay on track, our internal team meets weekly to obtain status, discuss issues and share lessons learned to improve processes for the transition of the remaining brands. 

·       Collaboration: An essential element to this partnership is collaboration with Wolverine's former trademark firm. To facilitate an aligned effort, we developed a process map, checklist and protocols for the intake processes of these files to ensure data accuracy and to procure knowledge of Wolverine's trademark portfolio.

·       Knowledge Management: In our ‘Voice of Client’ interview, Wolverine emphasized the importance of transparency and real time knowledge management capabilities. In response, we created a shared knowledge platform, using our Firm's extranet capabilities. The tool is designed to improve knowledge transfer, minimize risk and provide full transparency of status and priorities including key documents, metrics, etc. 

·       Process Management: We have scheduled the first of several joint process mapping sessions to be facilitated by Seyfarth's Project Management Office. We will conduct virtual sessions with key stakeholders to develop an improved process for handling various aspects of the trademark portfolio. We will also use these sessions to identify and/or develop template documents, checklists and guidelines to further enhance and promote best practices for the newly defined streamlined processes.

The effort to define the ‘rules of the road’, our relationship needs to move ahead on multiple fronts. So far, we’ve used several Lean tools and a healthy dose of project management to ensure a successful transition, and it will be vital to our ongoing strategic partnership with Wolverine--both from the industrial and artisinal perspectives. All of this though, is just the tip of the iceberg. We haven’t thought of everything and as they say, ‘more minds are better than one.’ 

That said, how have you used legal project management and how has it contributed to your client-firm relationships?

Next: Next stage of the fee discussions and more reports from the ground.

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“Your problem is to bridge the gap which exists between where you are now and the goal you intend to reach.” ~ Earl Nightingale

 Accountability, efficiency and value --- three words that are reverberating throughout the legal services industry these days.  In-house counsel are being held accountable by their companies to contain costs and predict expenditures; law firms must demonstrate efficiency and provide metrics to help communicate the value of the services provided. We’re in an era of transparency, one that demands, as Association of Corporate Counsel (ACC) President Fred Krebs, recently noted, “open communication and dialog.”

The recent International Legal Technology Association (ILTA) conference, held August 23-27 at the Gaylord National Resort & Conference Center near Washington, D.C., provided a forum for discussing technology’s role during this period of intense scrutiny.  One of the final sessions of the conference, “The ACC Value Initiative and What It Means to Technologists,” brought together the following panel with vast experience and insight from both sides of the legal aisle:

Fred Krebs, President, Association of Corporate Counsel

John Alber, Partner and Leader of the Technology Group at Bryan Cave, LLP;

Constance Hoffman, Chief Information Officer at Bryan Cave, LLP; 

Timothy B. Corcoran, Senior Consultant, Altman Weil

Alber, a practicing attorney with over 25 years of experience who also served as CEO for a software and database company, opened the discussion with an analogy, “Ten years ago newspapers made most of their money from display ads. That was also the start of monster.com and the dot-com explosion. Well, we’ve seen what can happen over a ten-year period to one segment when a critical mass bands together to affect change; and the legal industry is not immune to succumbing to this type of pressure to change.”

A recent study by Corporate Executive Board, found that over the past ten years costs to U.S. companies went up 20%, but that legal costs went up 75%. Law firms and clients are both under pressure to reduce legal spend, while still performing many of the same functions. Clients are now creating joint and highly-structured initiatives, such as the ACC Value Challenge, aimed at closing the perceived gap between what legal services cost and the value clients receive from those services. Law firms are finally sitting up and paying attention and as they develop ways to demonstrate their value to clients, those working with - and inside - legal technology departments can play a vital role.

“The ACC Value Challenge developed in response to member dissatisfaction,” explained Krebs.  “Rising costs, the disconnect between costs and services delivered in relation to hours billed and lack of communication, have all contributed to the development of this initiative.  ACC is calling for an increase in communication between in-house counsel and law firms to bridge the gap and work toward value driven solutions.”

In painting the picture of what it is clients want, Krebs highlighted the numerous opportunities that exist for technologists to help their firms respond to client needs.  The key areas where they can help, from the client’s perspective, are:

        1.    Better management; lean/efficiency (two-way) 

2.    Certainty /predictability (up-front budgets/scopes that stick)

3.    Focus on outcomes and results, not just on process and analysis (driven by evaluations and metrics)

4.    Costs that equate with value received

5.    Outside counsel and firms whose motivations and business models are aligned with the client’s

“The emphasis on predictability cannot be stressed enough,” explained Krebs. “This is where technologists can make a real impact.”

Coinciding with the ACC Value Challenge is the “Value Index,” an evaluation tool that will allow ACC’s in-house counsel members to rate their law firms and exchange information amongst each other.  Scheduled to be unveiled in October 2009, during ACC’s Annual Meeting in Boston, the goal of the Value Index is to enable in-house counsel to “tap into the wisdom of the crowd,” and gauge first-person feedback on the performance of outside counsel.

Law firms need to communicate with their clients and ask the hard questions, “Are they performing to the level expected? What is [their] perception of the firms they engage and the legal teams working on their matters?” Lawyers need to address these concerns, because soon, their clients might just be sharing their dissatisfaction with their colleagues.  Law firms cannot afford to be in the dark and must identify ways to not only address concerns, but also head off problems before they occur. 

The smart use of technology (making sure systems work efficiently), metrics (analyzing the data and improving processes) and collaboration (internal dialog) all play a significant role in helping firms to be more responsive to their clients’ needs.  Technologists, working closely with the attorneys and other administrative departments, can develop streamlined solutions and processes that can help with efficiency, reducing costs and long-range forecasting. 

Improving processes, however, should not be confused with “moving things around to just look different,” explained Krebs.  Referencing an article by Steve Levy in the August issue of Law Technology News, Krebs noted that, “Automating broken processes won't make us smarter; it can make us stupider faster.”

Having worked in-house with a law firm, as well as with a leading legal service provider and now with Altman Weil, Corcoran draws from his experience, and agreed with Krebs that, “After years of training, change is upon us and our time has come….but it’s not going to be easy.”

Corcoran referenced a recent Altman study, which showed that, in 2009, 40% of the In-House counsel surveyed planned to reduce the use of outside counsel, and almost 30% had reduced their internal staff. 

“We grew up with the belief that property values will always rise, and we see where that got us,” Corcoran said. “The same has been the case for lawyers, believing that demand will continue to rise and clients will continue to pay.  But clients are insisting on change. We’re hearing more about the challenges our clients are grappling with, and our surveys confirm, there is a movement going on. ACC has provided a framework – a voice  – to hear and respond to those challenges.”

While the use of outside counsel is declining, the work still needs to be done.  Corcoran believes this presents firms with a challenge, as well as an opportunity, to do things differently. “Firms need to look at the cost base and figure out a way to deliver their services at the lowest cost and in the most efficient manner.”

 Law firms must acknowledge that this is not “everyone else’s problem” – they must face reality and recognize that they are part of the solution.  Culling from other industries, Corcoran outlined how law firms can be more responsive to the changes taking place:

 ·      Cross-Selling:  For law firms, the concept of cross-selling is seen as a “nice to have,” and one that is inconsistent throughout law firms around the country. For most corporations, however, the idea of looking for opportunities for more business with the same client is “a matter of life or death.” It’s the lowest cost of sales – expending less on an existing client than trying to woo a new one. Having technologists’ insight and input – to better understand client needs (from a technology standpoint) - will help to strengthen the relationship.  Law firms need to make cross-selling a priority.

·      Project Management: Lawyers need to have more than just legal skills – they need to have an aptitude for project management. They would be wise to look to their own clients as models for project management – construction, transportation, manufacturing – all industries that require intense, seasoned managers to ensure projects are on target and within budget. Clients don’t like surprises. Without an experienced project manager to ensure matters are on track, law firms are exposed to unknown risks. Technologists have the knowledge from a project management standpoint and can convey to lawyers similar insights.  Law firms need to recognize the importance of project management skills and tap into technologists’ skills, as well as increase training in this area. 

 ·      Outsourcing:  When some think of outsourcing – they automatically equate that with legal departments using “non-traditional sources for their legal work,” but in actuality, outside law firms are an “outsourced provider.” Companies focus on their products and core competencies; they don’t do legal work. Law firms are one of their solutions. Technology departments and legal resource vendors, provide law firms with the necessary tools and resources to get the job done.  They are an integral part of the success – or failure – of a relationship and should be seen as a necessary partner in the firm/client relationship. In addition, a law firm can find ways to do some tasks a lot more cheaply, so the client does not turn to outside vendors.   

Companies, such as Practical Law Company, a leading provider of practical know-how for business lawyers, can help law firms provide their clients with the resources needed to practice more efficiently and deliver greater value. NOVUS Law, a document management provider, is another example of an external company that can help firms understand how to eliminate redundancy and find ways to do things more quickly, with less people, and improve the quality of the work provided. Off-shoring/outsourcing companies can help firms improve their business processes. Law firms need to embrace this concept and see the value in their technology departments and outsourcing companies to help them to be more efficient.

While technology can enable business process improvements, the answer, Tim noted, “isn't technology, it's the business process that needs fixing.”  Too many IT leaders get hung up on the technology and miss the wider point, which Krebs emphasized earlier: “good technology on top of a bad business process is meaningless. 

Understanding the kinds of technology initiatives clients expect firms to undertake in order to reduce costs and increase value is key.  Hoffman, who has been involved in identifying these needs for Bryan Cave clients, recognizes the practical applications of what can be done to transform relationships – bridge the gap - between clients and firms.

In order to be responsive, firms must have an open dialog with their clients. This dialog, explains Hoffman, “will provide law firms with the insight needed to develop systems and processes that will keep clients informed and abreast of issues that might change the timing, or even, budgets. “

Again, clients do not like surprises.

“By having that in-depth conversation with clients at the onset, explains Hoffman, “firms can put systems, such as detailed databases, in place to track progress on a continual basis. Not only can this help to reduce transactional costs, but it also allows for better reporting and transparency for the client.”

“The efficient use of junior lawyers or contract lawyers, with assistance from technologists, to collect the necessary data,” explained Alber, “enables senior lawyers to adequately analyze the data to evaluate the situation and keep clients informed throughout the process.”

This streamlined process helps eliminate surprises at the end of an engagement. Law firms can better manage expectations and in-house counsel have access to the necessary information to keep their CEOs apprised. 

This is a fundamental concept of the ACC Value Challenge, to bridge the gap of uncertainty, encourage transparency and connect expectations of value to the costs of the services provided.   The momentum for such discussions and frank negotiations is gaining and law firms are responding.  For those firms just now reacting, Corcoran noted, “they will not be first – they will be trying to keep up with the pack.”  Law firms cannot afford to lose their role as trusted advisor, because if they do, it will be years before that relationship is salvaged. 

Technologists’ ability to help streamline processes, improve efficiency and provide measurement tools is a reality in today’s legal environment.  Technology experts need to be part of the process from the start and valued members of the law firm/client team. Paraphrasing Churchill, Krebs noted that in discussions about the death of the billable hour, “never has so little been accomplished by so many for so long” the time for change is now.  Real change has begun as clients and firms implement value based arrangements.

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Susan E. Jacobsen, President of LUV2XLPR, Inc. has over 15 years of experience helping attorneys and corporate executives with public relations, business development, not-for-profit and advocacy communications, and continues to work with clients to developing successful new media and traditional public relations strategies.

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