A general counsel is no longer considered to be only a legal advisor. According to Deloitte, today’s general counsel is a crucial actor in the analytical and decision-making processes related to company operations. However, in order to do so successfully, you must have access to reliable legal data.
Understanding your legal data allows you to make informed decisions about budget, negotiations, personnel requirements, and other elements that will help your team be as productive and cost-efficient as possible while still meeting your objectives. Do you want to build up a system to gather and evaluate legal data on a regular basis right now? Here are some suggestions to assist you in accomplishing your goal.
Identify the business objectives of your legal department.
The data you’ll need to collect and evaluate will be determined by your objectives. Some general counsels may have as their primary objective the reduction of expenditures. Another example would be improving the efficiency of a team. Whatever your objectives, the sort of information you gather will be determined by them.
Create a list of the issues that your legal department is now facing in connection to the company’s larger business goals in order to properly outline your department’s business objectives.
Among the objectives are the following:
- Increasing the effectiveness of outside counsel
- Increasing the overall quality of the job
- Increasing the effectiveness of internal team growth
Sterling Miller, CEO & Senior Counsel at Hilgers Graben PLLC, offers the following advice on how to develop wise objectives for yourself:
- Take a look back at last year’s results to see where your team faltered.
- Talk to your manager about their concerns for the upcoming year to have a better understanding of their problems.
- Consult with your team and other legal professionals to determine what is and isn’t functioning (business difficulties, technology issues, modifications they would propose).
- Prepare for the year ahead by considering the legal, regulatory, and business issues that may have an impact on your organisation.
Determine whether legal dataset is relevant to your objectives.
Concentrate on the statistics that will assist you in achieving your objectives rather than chasing after just vanity metrics that will do nothing. You might be better off concentrating on financial data such as timekeeper rates, expenditure by vendor, and year-over-year legal expense rather than legal key performance indicators (KPIs) such as issue lifecycle time, if your aim is to decrease outside counsel spend, for example.
Assume that your purpose is to save money. You’ll need to keep track of cost-related legal key performance indicators, such as:
- Spending money on outside counsel
- Types of matters based on expenditure
- Comparison of hourly rates for timekeepers
- Spending by matter type on a monthly basis
Breaking down your objective into phases can help you understand which specific dataset is important to your aim. What measures would you and the other members of your team need to take in order to attain your objective?
For example, in order to limit the amount of money spent on outside counsel, you’ll need to:
- Determine how much of your work you outsource and how much of your job you complete in-house.
- Determine the compensation scale for the task you intend to outsource.
- Calculate the skills, training, and recruiting expenditures that will be required to accomplish such jobs in-house.
- Determine whether your suppliers are invoicing timekeeper fees for jobs that are below their level of expertise, and so on.
- NOTE FROM THE EDITOR: While you want to concentrate on goal-oriented data, it’s still a good idea to gather as much information as you can in order to accommodate shifting goals in the future. Take a look at some of the most important legal reports that general counsels (and their in-house teams) rely on to make better educated, strategic choices about their companies’ operations.
Make use of a data analytics dashboard to help you view your information.
When data is merely a jumble of numbers and phrases scattered across spreadsheets, it is almost completely ineffective. You need to see facts presented in a way that genuinely tells a story and directs you toward taking action.
In a spreadsheet, this is difficult, especially if you aren’t a trained data analyst with years of experience. It doesn’t help that spreadsheets weaken your legal reporting by making mistakes that are difficult to detect.
So, as a result, more law firms are putting money into legal operations systems with visual analytics dashboards, which make it easier to interpret the data, as well as the issues and possibilities it reveals.
However, if you do not have access to a centralised legal analytics dashboard such as this one and are unable to justify the expense, you might attempt to manually compile your data and legal papers. You’ll need to gather all of your paper invoices, court documents, and other legal material from the previous and current fiscal years and record it into a single database.
Obtain payment for vendor invoices, timekeeper bills, tech and tool bills, accruals, and other expenses. Consider contacting your vendors to get copies of invoices that you have misplaced. Once you’ve gathered all of your information, arrange it in columns and rows according to the following criteria: name, rate, cycle, etc. Although it will not give the visual clarity of a dashboard, it will at the very least allow you to concentrate your data rather than having it strewn over numerous files.
Conduct a performance analysis of your law firm’s data and procedures to uncover performance insights.
The analysis of your data will provide you with the insights you want to make sound business decisions now that you have consolidated all of your information.
Because goals are constantly diverse, analysis can go a variety of different routes, but the following general guidelines for efficient data analysis apply:
- Isolate your data based on the time period you’re interested in learning more about.
- Compare similar key performance indicators (KPIs) for your vendors or topics. (This is simple to perform on one dashboard using legal operations software, as seen in the example below.)
- Keep an eye out for patterns and/or inconsistencies in the data that are connected to your business objectives, such as one vendor billing for much more hours than other vendors for the same job or one vendor charging significantly less than other vendors.
Is the job they’re doing on par with that of other providers in terms of quality?
It is not as difficult as you would believe to make use of legal data. Begin the process of transitioning now.
When done effectively, the shift from a traditional general counsel to a data-driven general counsel is not a difficult or time-consuming one. Collection and utilisation of insights from data become less intimidating when using the proper tools and having an established grasp of what you want to accomplish.
Billing and topic management are two areas where you may begin using data to improve your team’s performance. It is simple to outsource the data collection associated with these routine procedures to legal operations software.
The information you gather on these two topics will assist you in better understanding team productivity, value, results, and outcomes. That sort of information is essential for making choices about staffing and expenditures..