Ken Crutchfield, vice president and general manager, LRUS Legal Markets, Wolters Kluwer Legal and Regulatory, U.S., discusses ways that corporate legal departments can optimize their operations, from budgeting and spend to the efficiency and success of business outcomes.

CCBJ: The pressure to manage the balance between cost and outcome continues to increase. What trends do you see in how corporate legal departments are budgeting and forecasting?

Ken Crutchfield: I believe the key is to think of budgeting in terms of productivity and leverage. The ability to identify tools and technology that make staff more effective and help them get the right outcomes is crucial. That’s really the area that I’m looking at as the pressure relief valve, if you will. There are a couple of actions that can be taken that tie into that idea. As in-house counsel, consider your stakeholders and customers – are there actions that you can take to offload work and empower them to be more self-service oriented, for example? Another important action is to consider key performance indicators (KPIs). If your organization does not have KPIs, perhaps it should.

If you are using KPIs, consider whether they really are measuring outcomes or if they’re just measuring activity. Measuring outcomes is much more important and impactful, and they may not necessarily be measured in legal terms. For a simple example, are there ways that you can enable more nondisclosure agreements to be completed with less involvement from the in-house counsel, making stakeholders more self-sufficient? Or, if you’re looking at sales contracts, for example, can you turn contracts around faster to increase the close cycle of your sales team and increase sales productivity? Can you reduce the contract revision cycles? Increasing sales productivity or sales results are more meaningful KPIs than the total number of contracts negotiated, for example.

How can corporate legal departments work more closely with individual business units to achieve business goals?

It’s very important to set aside a specific time to meet with business stakeholders and understand who your most important stakeholders are and build relationships with them. Make sure you understand their goals and objectives and needs – and consider what is strategic for the business. But also pay attention to the softer issues. What helps your stakeholders from a personal perspective or from a constructive political perspective? At the end of the day, business is still done between people, and having a good relationship in which both parties trust and understand each other helps to provide a more holistic and collaborative context, which I believe is very important.

For example, if a business stakeholder is going to make a bold move like integrating two business units that have been separate for a long time, and it hasn’t been done for a number of years because there was some risk or a particular issue, and now your stakeholder is looking to resolve that longstanding issue, consider how you can help make that move smooth and successful.

How can corporate legal departments work with other areas, business units, information technology, etc., to advocate for new systems and software processes?

Make sure you understand the business’s goals and needs. For example, with the pandemic, are there digital initiatives that are logical to align with in support of the broader business? Would aligning with broader initiative provide access to other budgets or create synergies that could be leveraged to benefit the broader business and the legal department? That’s a great opportunity to find common ground and leverage. I would also view budgeting as a process, not an event, even though 2021 budgets are already upon us. The wise corporate counsel department is thinking longer term and about the 2022 budget and the 2023 budget right now. Understanding what seeds should be planted, what outcomes are desired, and being able to communicate steps to achieve those outcomes even if you’re not making a formal request right now is important.

I would also emphasize the value of developing relationships here once more. As I said, business gets done between people. The more you understand stakeholders and their needs, the more you will be able to find that win-win. It takes time, and it takes an investment at a personal level, to be able to understand how to manage and operate within your broader corporate ecosystem, but it’s very much worth it.

Despite the pandemic, every indication I see is that legal professionals are busy, both in-house and at outside firms.

How can research solutions and applications help in-house counsel better optimize their spending?

I’d really encourage counsel to step back and look holistically at their budget and activity. Are there tools that could help you spend your money more effectively? And then also, as part of that thought process, consider what the high-value activities that the department engages in, versus the low-value ones. Just because something’s been done in the past doesn’t mean that it has value or that it’s even relevant anymore. Thinking about how to stop low-value activity or at least reengineer it is an important point to consider. And within that same frame of thought, there is also the question of the bigger buckets of people, of tools and of outside counsel. Consider if shifting a little bit of the budget from outside counsel, you could invest in some tools that would make your department more effective, whether it’s by implementing software such as a contract management system or some other initiative.

For example, Wolters Kluwer recently launched the Cheetah for Corporate Counsel solution. It includes a series of multistate surveys that can provide answers or better direct outside counsel spend on policy-related issues. Leveraging a collection of multi-state surveys or other practical content may allow your department to more effectively direct the spend when you need to go to outside counsel and achieve better results. Maximizing budget and leveraging tools can help your team step back and look more holistically, which can drive greater productivity and better outcomes with limited resources.

What trends do you anticipate over the next 18 months?

We conducted the 2020 Wolters Kluwer Future Ready Lawyer Survey earlier this year and uncovered a number of dynamics, including how technology is changing relationships between in-house counsel and their outside counsel firms, the demands of productivity and the need to get more done with less, and all the pressure that entails. So I believe we’re going to see work continue to move in-house or be reevaluated. People are busy. That’s a trend that we shouldn’t forget, that there’s more work than ever for lawyers to do. And despite the pandemic, every indication I see is that attorneys are going to stay busy, both in-house and at outside firms.

It may feel like a time to switch into survival mode, but the savvy corporate legal departments will see these times as an opportunity. Should there be greater development of analytics for better decision-making? I believe you’ll see more emphasis on analytics and data driven decision making. I mentioned self-service earlier. Any place where work can be automated enables resource to be deployed elsewhere. In the end, if your department can understand the broader business goals and align to those initiatives, you can ensure better results. That requires an investment in relationships. An understanding those goals give you the power to maximize the resources entrusted to your team by thinking across budgets categories and by applying productivity tools ensure impact for legal and business results.

We all feel pressure to do more with less. Legal professionals are busier than ever and are all feeling the pressure to deliver. We are also trying to balance work and family. By applying these principles, I’m hopeful that you can find balance in life and your work team can successfully navigate and thrive in these challenging times!

What other considerations should legal teams be thinking of as they continue to adapt to the current environment?

COVID-19 has significantly changed the way employees do business, and many of these changes – working remotely, communicating on mobile devices, not being connected to a company network, sharing documents and messaging through cloud-based software – impede a company’s ability to readily track and access data in a systematic way. Moreover, these newer apps are seeing significant increases in use and their systems have not necessarily been tested, from a security perspective, in this way. I’m thinking of Zoom in particular, which has become the video conferencing software of choice for many organizations now conducting business virtually. That app has just exploded since the shelter in place orders started. This security concern is one of the best arguments, aside from e-discovery needs, for having an information governance policy in place: There is just so much personal data out there, personally identifiable data, personal health information, credit card information, Social Security numbers and the like. If a company is not proactive about protecting that information, it’s potentially out there for the taking. And when I say protect, I’m anticipating that companies have done some level of work to protect their data, but as the location of this data changes, companies need to adapt to the new risks and put security additional measures in place.

In short, this major transformation in the workplace can create a number of headaches for in-house legal down the road, from lengthy and complicated document collections to data security breaches. But with foresight and the right expertise, they can identify the issues now and avoid costly and time-consuming problems later.

To read the Wolters Kluwer 2020 ACC Legal Operations Maturity Benchmarking Report, click here, and for their Future Ready Lawyer Survey, click here.