Alexander Hamilton, one of the Founding Fathers of the United States, is quoted as saying:
“If you don’t stand for something, you’ll fall for anything“
While his words are commonly attributed to his support for the US Constitution, they also offer an important warning to in-house lawyers (“IHLs”) who frequently fail to attract proper value recognition.
The lesson is this: If you have not communicated to your team and your internal client what you stand for, how do you expect to be judged?
Are you happy with how your IHL team is presently being judged?
A Legal Department Service Charter (“LDSC”) is a policy-based asset that sets out for your IHLs and your internal clients the operational frame of reference for your legal department – it is your Operating Charter.
In this article, we unpack the challenges posed by operating without an LDSC, the benefits it can bring … and how easily and quickly you can implement one of your own.
KEY ISSUE INSIGHT
GLS has observed a positive and consistent correlation between IHLs that do not enjoy optimal value recognition and the absence of a clearly articulated and authoritative LDSC.
Generally speaking, "charters" are the record of authority that permit a particular initiative to commence – in this case, defining the purpose and objectives of your IHL – it serves as a source of legitimacy.
The LDSC has two primary purposes:
FIRSTLY: it serves as a reference for your team members, defining a focus, direction and context for their efforts and contributions – the team's function & purpose and the means to achieve it.
By providing clear directions as to the purpose and objectives of the team, and ways of working, the LDSC keeps the team focused on the right activities and maintains critical departmental momentum.
SECONDLY: critically, it educates the internal clients and wider business units as to what your IHL team actually does – providing understanding of a department's purpose heavily influences how it is used.
The LDSC also prescribes how internal clients should interact with the IHL and what they can expect from their interactions with the IHL team – bringing clarity around your IHL’s role and performance.
Sadly, too few IHLs consciously implement LDSCs, resulting in “mandates” that evolve into existence as a business grows, without the same deliberate intent as many other business areas benefit from.
CONSEQUENCES OF UNDERLYING PROBLEM
A board’s charter is a vital instrument that clearly defines the roles, responsibilities and authorities of the board of directors and sets the direction for the management and control of the organisation.
Similarly setting boundaries, establishing authorities and clearly communicating expectations around the performance of your legal function is critical, particularly given the growing pressures IHLs face.
Businesses are increasingly expecting IHLs to perform miracles and deliver unlimited legal support, in real time, with little/no turn-around time – an unrealistic expectation that is hard to manage without an LDSC.
The IHL’s responses need to be clinically precise and increasingly customer centric but also have a much sharper sense of operating priorities – something hard to deliver without a clear LDSC asset.
We consistently observe that IHLs operating without a meaningful LDSC frequently experience some, if not all, of the following:
• No Man’s Land: the IHLs seem to just exist – operating in a kind of "no man’s land" in terms of authority, reporting, autonomy or mandate
• Unfair Performance Assessment: the team’s performance is undervalued in part due to a lack of clear performance criteria against which it should assessed
• Opaque Engagement: unclear / no formal rules / guidance around how the business should engage with its IHLs
• Disorientated Productivity: being busy is not the same as being “productive”. Without a clear and consistent objective, IHL capacity is wasted on out-of-scope matters
• Perception of Low Performance: IHLs are judged against constantly shifting goal posts, exacerbated by frequent pressures to undertake tasks that are not within their domain of expertise
• Inadequate Resourcing: regularly being asked to reduce budgets and IHLs being unable to defend budget decisions, resulting in a perpetual firefighting modus operandi
• Blame: IHLs become the scapegoat whenever things go wrong, because the perception is that they are responsible for everything
• Perpetual Fire Fighting: IHLs operate on a reactive footing, rather than preemptively working with the business to pro-actively control the utilisation of IHL resources
BENEFITS IF PROBLEM IS SOLVED WELL
Excessive uncertainty is a miserable problem for IHLs and their internal clients to deal with. The absence of an LDSC perpetuates the corrosive impact of operational uncertainty.
By using an LDSC to remove that uncertainty, your legal function can begin an operational transformation that is increasingly characterised by:
|Platform Legitimacy||the LDSC delivers you and your team a clear and legitimate platform that the business can understand and respond to|
|Clear Responsibility Delineations||the LDSC should be clear on the domains of responsibility inside your business and such endorsements should ideally be delivered from the Board level|
|Authority||your LDSC should capture you authority within the business|
|A Clear Operating Protocol||a clear standard operating procedure for how the business should engage with the IHL and vice versa is available to your business|
|Focus on the Internal Client||an increasingly client centric protocol to your business – something that will be appreciated by the internal client, whilst also effectively managing expectations|
|Work Prioritisation||your LDSC will enhance your ability to manage finite team resources – decisions can be made in light of agreed/endorsed priorities|
|Internal Client Validation||the basis for you to objectively demonstrate your IHL’s contributions via empirical data comes into existence – performance against agreed priorities can be assessed|
|Legal Budgeting legitimacy||IHL budget requests can increasingly be supported by hard data that shows the effectiveness with which you have discharged your mandate|
|Increased IHL Team Morale||morale is improved as the team’s recognised mandate and operational boundaries are more clearly understood and operational uncertainty is eased|
THE GLS SOLUTION
As with most things – you could take the principles contained in this article and produce one for yourself.
The problem with that is, if you are like most IHLs, you simply do not have time to do it.
Fortunately, and this is the point of the GLS Legal Operations Centre, we have developed a world class “ready to go” LDSC that you can quickly customise and implement into your business ecosystem.
The GLS Legal Dept. Service Charter™ has been developed by former GCs, Board Directors and C-Level executives to be functional, understandable and provide a clear and authoritative charter for your IHL.
GLS Legal Dept. Service Charter™ will help you:
• clearly and authoritatively delineate your IHL’s domains of responsibility
• capture your IHL’s authority within your business
• set the terms of engagement for your business
• set clear expectations for your IHL
• help set the context for better prioritized decision making
• help transform your legal function to a “New Law” footing
• optimize the utilization of your budget and resources
• deliver better results for your internal clients
• get better recognition for the results that you deliver to your internal clients
• get serious about your transformation agenda.
This solution is a simple and highly impactful combination of solution design modules, best practices and implementation support.
CONCLUSION & NEXT STEPS
Overcoming the chronic low value recognition profile suffered by many IHLs is not something that can be solved by a “magic pill”. However, certain steps are more foundational than others – the LDSC is one.
Operating without a clear LDSC denies you access to the things that drive IHL value recognition – namely clarity around your mandate, authority, engagement protocols, priorities and ultimately your performance.
If you want to empower your legal team through an “enabling platform”, then the GLS Legal Dept. Service Charter™ represents a highly qualitative and efficient way for you to do so.