The 2018 Chief Legal Officer Survey states that only thirty nine percent of law departments surveyed employ at least one legal ops professional. Of that 39%, less than 50% of the legal ops professionals came from the legal department. Of course, these numbers don’t necessarily mean that the legal operations team is led by a seasoned leader. Even the largest legal departments may have administrators, or project managers, who chanced on the role with no one to guide them. The above survey also states that most General Counsels spend only 18% of their time in the management of their department, which means that they are probably not spending too much time thinking about how legal ops needs to be structured. As new ops leaders take on the role or existing legal ops professional broaden their portfolio, it is important to set clear vision and priority for your department or you will spend most of your day dousing fires.

As I started my journey of a legal ops leader, like any other leader coming to a new role, I spoke to my existing legal team to understand their pain points and challenges. I realized very quickly that I had to draw up a roadmap for my department before I was drowned in the laundry lists of everyone’s problems.

Here are my top tips for new ops leaders coming into an existing, seasoned legal team. I am sure there are many other tips which legal ops leaders would go by, but this is what is important in my opinion.

1. Understand team dynamics

To state the obvious, it is very important to spend your first few days understanding your legal team structure, key leaders and stakeholders. If you have the opportunity to interact with legal team leaders and managers before you start in your role, take that opportunity in a heartbeat. While formal catch ups are a great way to understand about people’s work, I find informal conversations to be insightful as people drop their guard. Make notes of each person’s requirements (but make no promises at this point), this is important when you plan your roadmap as it will guide you on areas you want to focus on. It also helps to gather support if you can personalize your road map to real life problems. When I came on my role early on, one of the biggest problems was our duplicative invoicing processes. Acknowledging the problem in my stakeholder meetings and providing a plan to fix it in week three of my job helped people realize that I was there to help. And, meeting that deadline established my credibility early in my position.

2. Don’t try to churn the ocean

As a new leader you want to work on garnering support early on and you will want people to feel you are there to help. As a result, your colleagues will pour out their problems to you and expect you to wave your magic wand and solve their issues. Unfortunately, organizations are far too complex for a magical solution. As I mentioned above, listen to everyone, but make no promises and for your own sanity, don’t try to solve every single problem for every single person on the team. Prioritize your vision based on your department structure. For my organization, our commercial and regulatory teams constituted the largest part of our team and I focused on those functional areas to find the low hanging fruit and quick wins.

It is also important to steer clear of operating in solution mode in your early conversations. As natural problem solvers, many new ops leaders jump into solution mode very quickly. Spend your first few weeks understanding and mapping your current processes. Most legal departments are not likely to have detailed process maps and you will not be able to get most of your programs off the ground if you don’t understand the current processes.

3. Make a plan

Never undervalue the power of a 30 / 60 / 90-day plan. I have used this in every single new role, and it has worked brilliantly. A 90-day plan gives me structure and helps me from getting lost. I draw my plan based on big picture themes and then build tasks to support the theme.

My plan as a new ops leader looked like below. You will see that I tend to start more internally and focus on vendor management only after I had a good understanding of internal processes and stakeholders. The plan gives assurance to the Chief Legal Officer (CLO) that I know what I am talking about and that s/he made the right decision in hiring an ops lead.

4. Do a SWOT analysis

My first month in my new job, I spent all my time making notes on what works and what doesn’t. Again, some of this is very basic and simple but it is the simple that we forget. When I presented my SWOT analysis to our CLO and the legal leadership team, all I got was nods and alignment in thoughts. It was great to know that we were all on the same page. Understanding the strengths and weaknesses also gave me a foundation to build the vision for my own department.

5. Build your own vision

I was lucky to have a CLO who gave me a blank canvas and asked me to paint what I wanted. I understand not everyone would be as lucky as me. However, this is the most critical for your own success and for others on the team to show that you mean business. CLOC has amazing content that can help you build your legal ops plan. I knew I didn’t want to tackle all twelve core competencies in year 1 and based on my SWOT analysis, I picked five, or six, competencies to focus on. I structured my team based on my priorities and drew a roadmap based on the pillars I chose.

The key competencies I focused on were – Technology, Automation and Continuous Improvement; Legal Finance, MIS and Law Firm Management; Knowledge Management and Process Documentation; Resource Allocation and Professional Development.

My main goal was to document our processes within the first 12-18 months. We didn’t have any standard operating procedures and our playbook and policy documents were outdated, so we created a plan to tackle those first. As we went through the documentation process, we were able to identify gaps in our process and define what we wanted to improve early on. It was the process documentation that led us to our technology roadmap. We focused on our existing technology and increasing technology adoption became a priority. Finally, we wanted to start capturing metrics and some of the tools we put in place helped us with that process. The ability to present data to stakeholders early on sets you apart from other ops professionals. Most stakeholders like to believe that they know the pulse of their department, but they face some harsh truths when they are presented with hard data. Your data may not be perfect in the beginning, however, metrics and KPIs are the best quantifiable ROI tools.

All organizations are different, and every ops leader will have a unique journey. CLOC is a great forum with some very relevant content that helps connect you with peers in the industry who are very open to sharing ideas and collaborating. Knowing you are not alone in this journey gives solace to a lot of us.

The Vital Role Of Reporting For Legal Operations

Easy to use, clear and comprehensive reporting functionality has evolved from an added bonus to a must-have requirement for corporate legal teams when evaluating legal technology. The pressure on legal operations to demonstrate improvements and return has led to reporting features being almost as important as the fundamental benefits of the software tool in use.

Where legal operations is missing a trick is when data analysis from a particular tool is used in isolation. To use legal spend management software as an example, out-of-the-box spend reports and user-friendly analytics wizards allow legal departments to monitor work in progress, measure actual spend, and forecast budgets accurately.

That’s not to say legal spend data isn’t useful on its own. On the contrary, legal operations teams use spend data to make better matter resourcing decisions, negotiate discounts, get more value from firms, and hire more internal staff.

Combining Legal Data To Better Manage Risk

Where the in-house legal function is working closely and in partnership with the business units across the company, the range of information and data it holds will often put it in a unique position within the organisation. This data not only supports an awareness of what the business is doing but also forms part of the historic corporate knowledge that is built up over the years; such as previous contracts, decisions and outcomes. Historically, this information was not held in a structured electronic format, which meant any form of data and trend analysis, as well as knowledge management, was extremely manual and time consuming.

With the increase in legal matter management and legal spend management solutions as well as better document search and retrieval there is a growing need and clamour for data processing, data analysis and knowledge management. Capturing basic contract terms and/or details of legal opinions in a matter management system provides a very simple knowledge management tool and a rich source of data. Other tools that will help provide data are any solutions used to create standard contracts, access to benchmark reports, as well as internal resources (finance reports etc.).

Those legal operations teams that are seeing the most value are those that combine data from various technology tools to take their strategic input to the next level. One such area is management and mitigation of risk.

A legal operations team that is carrying out data analysis on all the data at its disposal will be in a position to identify trends that will lead to a range of questions that should spark further debate, such as;

• How much work is done “in-house” versus being sent externally?
• Are the correct processes being followed?
• Are we getting the right level of technical support for the type of transaction?
• Is there a growth in the types of transactions either at a business unit or country level?
• Is one firm being used more than others for similar types of transaction from a particular part of the business / legal team?
• How does the firm perform against others for similar types of transaction both on price and performance?
• How does the business differ to market peers?
• What is required to manage a specific regulatory change?
• Is the in-house legal function and its staff compliant with the relevant regulatory authority guidelines, such as the Solicitor Regulation Authority (SRA) etc.?

Below are some examples of how the answers to these questions could demonstrate a change in the risk profile and risk appetite.

By monitoring the volumes of work, what type of work is being done, who is doing it (in-house lawyers, external lawyers or a combination of both), the time taken, the costs etc. the legal operations teams will be better placed to advise on the organisational design, support and management of the legal function as well as the risk profile and the risk appetite of the legal function and in certain cases, the supported businesses.

A better understanding of what is being done and by whom, will help ensure that the legal function is properly resourced, is not taking on activities that are better placed in other parts of the organisation, and that the appropriate processes and procedures are in place and controls are being administered. For the legal function and its in-house staff, this might include ensuring that they are complying with the rules of the governing bodies such as the SRA, NALP, the Federal Bar Association in Germany etc.

Spotting an uplift in a particular type of work (such as litigation) or activity (such as drafting) could indicate a lack of understanding of the contract terms within the business front line areas who are requesting contract changes, bad working practices, poor standard documentation, or changes in the markets and/or economic climate (each of which also presents opportunities). Legal operations teams can help to mitigate these by highlighting trends and ensuring that the legal function;

• Delivers better training and communication to the business and legal function
• Carries out regular reviews of standard documentation,
• Supports reviews of policies, practices and procedures, and
• Develops a better understanding of the market.

Consistent use of one firm over others should provoke questions as to why that firm is being used. It may be that they are very competitive on price or they have the appropriate skill sets. Fixed fee arrangements are increasingly popular, but if the firm is not providing any supporting timekeeper activity data, it becomes difficult to know whether the firm is providing the right level of technical support and whether the fee structure is still fair and balanced. As part of the legal operations team’s vendor management programme, they should ensure that that firms are maintaining the right level of skill sets for the work they are being asked to undertake, as this will help mitigate legal risk caused by a lack of technical knowledge and support. For the more complex deals it would be normal to see more senior lawyers engaged with the matter.

With the increase in cyber security and greater scrutiny by regulators who are starting to require more rapid, robust, evidence-based reporting, the need for greater use of these solutions is becoming more prevalent to avoid data being compromised and fines being levied. Understanding what data has been passed to which supplier helps ensure that those suppliers have appropriate controls in place to manage that information in line with Information Governance and Records Management policies and procedures and that any breaches promptly reported.

It is also worth noting that a lack of data in the legal systems is equally as insightful as it will show where parts of the business and/or legal function are not following agreed practices and procedures. Furthermore, using “gap” reports in the legal systems helps identify problems within the data that will distort any data analysis.

For legal operations teams to deliver process improvements and efficiencies, ensure compliance with policies and regulatory requirements, optimise their spend and manage risk, they should analyse the data that is available to them from all the data sources at their disposal. As they start to analyse all their data, instead of analysing point solution data in isolation, they will start to discover new trends and insights not previously seen or understood.

About BusyLamp

Founded by a team of lawyers and powered by frustrated users of endless spreadsheets and clunky legacy legal tech systems, BusyLamp is the leading SaaS alternative for efficient legal operations. We help legal departments save time, significantly reduce costs, and collaborate more effectively with in-house and outside counsel by simplifying and improving their legal processes. Legal departments leverage our end-to-end solution to improve visibility and efficiency from pitch to completion. Become a member of the BusyLamp user family and take advantage of our sophisticated sourcing, fee tracking, e-billing, matter management and vendor management features, all with powerful reporting and analytics.

www.BusyLamp.com

There is a lot of buzz regarding the change AI is bringing to the legal space–who hasn’t read an article about “robot lawyers” coming to take our jobs? On some level we know this isn’t an accurate forecast, but the media thrives on the vagueness and uncertainty surrounding AI. Meanwhile, it’s often difficult for GCs to determine if a software pitch is the right solution for their legal operation needs.

Some of this interpretative struggle is due to the seemingly endless applications for legal tech solutions. That’s why it is critical to understand that AI brings new processes to the table, but that lawyers and legal professionals will always work in tandem with AI. It’s not humans or machines; it’s “Humans + Machines.”.

What is LIBOR?

In July 2017, the UK’s Financial Conduct Authority (FCA) announced that by the end of 2021 British banks would no longer be required to submit rates for the London Interbank Offered Rate (LIBOR). This means that LIBOR will play a diminished role in the global financial system going forward, and may disappear altogether.

Ever since that announcement, law firms, corporate legal departments, ALSPs, and everyone in between have been asking: How many of our clients have “LIBOR-infected” contracts? How much money is at stake? How do we prioritize and facilitate re-negotiation and re-papering?

The first hurdle is to identify the LIBOR-infected contracts. After that, teams of lawyers and legal professionals can work on remediation. That’s a two-pronged problem, requiring a two-pronged solution.

Identifying LIBOR Contracts with Machine Learning

Discussing machine learning (ML) solutions brings us back to that “robot lawyers” misunderstanding. A well-trained ML platform will find a lot of relevant data points in a large set of documents and can be adapted and customized with additional ML techniques to meet the unique challenges posed by the LIBOR problem. Designing and building these robust techniques requires strategic planning and communication between various types of subject matter experts . A software development team can build ML algorithms in multiple different ways, but it takes experts in law and finance to fully flesh out all they need from a custom LIBOR analysis tool. Basically, “robot lawyers” don’t exist; effective ML requires a range of human experts to sit down and discuss how best to solve incredibly complex problems in a sophisticated and results-oriented way.

ML is not a conveyor belt where data goes in and perfect results come out. It takes time and iteration. This is actually what makes ML a natural companion discipline for legal: both disciplines require taking in imperfect data, then developing creative and effective solutions with that data.

For example, an ML implementation team handling “LIBOR-infected” contracts must ask whether a few natural language processing (NLP) techniques can find all the required data, or whether more complex vectorization models are needed. Data points are neither simple nor intuitive: spread percentages; governing law clauses; jurisdiction-specific legal language; synonymous or nearly-synonymous terms such as “Eurodollar”; and fallback clauses tied to other reference rates such as SOFR and SONIA.

ML can solve a lot of problems in legal, but sometimes it’s forgotten just how vital the contributions by experts are. At the end of the day, ML is just complex software. ML is only as good as the team that builds it, oversees it, and shepherds its evolution.

Solving LIBOR Remediation with Expert Services

The LIBOR problem requires teams of various specialists. Many organizations already have such teams, or at least a set of processes in place. Service teams from law companies like Elevate must be nimble enough to integrate with clients and their processes in order to augment what is already there. A client may not want to use ML, but an outside services team may recognize the potential for ML deployment or see that it is wiser to simply ramp up the human review team.

Either way, for an acute problem such as LIBOR, a services team must bring necessary resources, processes, and technology to their client’s team, and help deliver efficiency and cost savings in four major ways: quantification, action planning, remediation, and reporting.

Quantification

To properly determine the level of repapering a client needs to remain compliant and reduce risk, any outside services team should know how to quantify their client’s LIBOR exposure with a full historical assessment of the contract paper in question.

This initial quantification is effort-intensive, which is why many organizations bring in the efficient expertise found in law companies. Moving fast and iterating is just as important for AI developer teams as it is for a specialized services team.

Quantification efforts will typically include:

• Scoping
• Targeting data repositories for relevant contract data
• Identifying the contracts most impacted by LIBOR (perhaps using a platform like ContraxSuite)
• Reviewing and summarizing contract information for further analysis
• Working with a client’s pre-existing methodologies to provide internal stakeholders with the clearest picture: which agreements are impacted, their level of exposure, and actions needed

Action Planning

After quantification comes the action plan. For a services team, this may mean:

• Supporting Legal Project Managers as they help their teams map out necessary steps and delegate tasks
• Coordinating parties for effort estimates and accountability
• Identifying, assisting, and leveraging third parties (e.g., outside counsel, law companies, technology providers, and/or experts)
• Building consensus and internal buy-in for final action plan

Remediation

After quantification and action planning, it’s time to finalize the review and tally up the contracts that require remediation. The following are five general types of remediation:

• Level 1: Tracking all “no action” contracts
• Level 2: Notification (outgoing) of LIBOR rate transition
• Level 3: Notification and simple remediation of contract (no countersignature required)
• Level 4: Notification and simple remediation of contract (countersignature required)
• Level 5: Notification and full remediation of contract

To assist with the facilitation and resolution of these items, organizations will most likely need to hire temporary contractors or outsource the remediation process to a legal service provider.

Reporting

Throughout the process, it is important for legal teams to be aware of the progress being made, agreements pending, agreements remediated, cycle time, type of remediation, etc. A good services team knows how to support the management, tracking, and presentation of reports for internal stakeholders, ensuring accuracy on scope, quality, and budget over time. Again, the use of AI tools by a services team can take this even further, providing deeper data- based insights for future projects.

Conclusion

“Humans + Machines” is better than humans or machines by themselves. We have delivered contract insights on existing and remediated agreements, using the specialized skills of our services teams, and powerful software tools like contract analytics platforms that sift through thousands of LIBOR-infected contracts. The current centrality of the LIBOR problem is just one of the many examples of “Humans + Machines” completing high-quality enterprise legal work. It will only get better from here.

About Elevate

Elevate is a law company, providing consulting, technology and services to law departments and law firms. The company’s multi-disciplinary team of legal professionals, business professionals, and technology professionals extend and enable the resources and capabilities of customers worldwide. Learn more at elevateservices.com.

The pace of transformation in the legal services market continues to accelerate and we’re seeing a growing enthusiasm from in-house legal teams to embrace this change. There are a growing number of opportunities to develop skillsets and embrace alternative legal careers, as well as to be at the forefront of this evolution by driving change and encouraging genuine thought leadership. In this blog we focus on the people aspects, including how the pressure to upskill teams may affect individuals in different ways; the diversification and introduction of new roles and skills, and an increased focus on wellbeing.

The lawyer of the future: One size doesn’t fit all

‘Strategic’, ‘commercial’, ‘flexible’. According to in-house legal teams, these are the key attributes needed by the future lawyer to succeed. Are the days when lawyers were expected to know the law and only the law now in the past?

With many organisations aligning their legal teams to business areas, lawyers are under pressure to become more strategic and flexible; equipped to respond to queries across multiple legal disciplines and having the commercial knowledge to support this advice and provide tangible solutions. Add to this the need to consider legal tech within these solutions, provide thorough project management and become data literate, and you can see that the role of the in-house lawyer is under immense pressure to evolve. Many lawyers are embracing this challenge with enthusiasm, hungry to be learn new skills and discover alternative career pathways. Where though does this leave those lawyers who want to remain in a specialist position and don’t have the appetite to develop further skills? Is there still a place for them in the in-house legal team structure? We recently discussed this question with a group of clients, and the answer was a resounding yes. These people are in fact integral to the success of the legal team and we need to acknowledge the value they bring to the function. Whilst they may not wish to bring new skills to the table, they too can be part of this transformation solely by adapting their mindsets and becoming more inquisitive. By challenging the status quo, identifying alternative approaches to tasks and asking colleagues if certain tasks could be done more efficiently, they will add a huge amount to the legal transformation agenda.

Whichever ‘change bucket’ you’re in, the key is to appreciate the different perspectives each individual can bring, recognising that some may be more subtle than others.

From forming to storming: The changing role of the in-house legal team

The evolution of the in-house legal team is starting to gain pace and we are seeing new areas of expertise developing. The rise of the ‘legal operations’ role is a prime example; this is now a key senior role in many firms and does not necessarily have to be performed by someone with a legal background. Rather, business, financial and strategic skill sets are key to be able to identify opportunities to maximise value for money of external legal spend and deploying strategies to make efficiency and cost savings.

Given the demands on the in-house legal function to manage complex regulatory change projects, streamline high-volume legal processes as well as perform the role of the firm’s trusted legal expert and minimise risk, we are increasingly asked by our clients whether they should be looking to hire their own legal project managers or legal technology experts to support them. The answer to this is not clear cut. It depends on the size of the organisation and the appetite for keeping the work in-house rather than leveraging law firm’s expertise in these areas. Regardless of this, if you are considering it the first step is to fully engage with these roles and understand the value they would bring to your organisation, taking into account the behavioural change which would need to be adopted to ensure the full integration of the team.

Our view is that the in-house legal function’s transformation journey is, to quote Tuckman’s group development model (forming, storming, norming and performing), currently in the ‘forming’ stage where team members with differing skills will act independently of each other. To move to the next stage of maturity, ‘storming’ where the group start to work towards the common strategic goals will require people to embrace conflict and change in order to succeed. Actions speak louder than words: a refreshing approach to mental health.

Alongside the maturing landscape of the legal services market has come the recognition that the legal industry needs to be doing more around mental health. A leadership focus on this topic, and employee wellbeing more generally, has seen this become one of the key priorities this year. Two refreshing aspects which we have seen regularly are worthy of highlighting:

1. Pledges alone are not seen as enough. Operational and behavioural change need to align to deliver the improved outcomes underpinning those pledges; and

2. A movement away from sticking plaster solutions to the problems when they arise, and much more determination to address the root causes. We expect to see this remaining a key agenda topic in coming years ahead, with an increasingly strong focus both on leadership and actions, not just words.

All in all, this is an exciting time to be in the law! New career paths, brand new roles, and new opportunities for people with diverse skills. But what is clear is that traditional roles and legal expertise still very much have a central place in this broader NewLaw community, and integration and collaboration are key to the progression of the industry.

About Ashurt Advance

Ashurst Advance combines NewLaw expertise, a positive approach, collaborative working and thinking beyond the immediate deliverables, to help solve our clients’ business challenges and create value for our clients. We bring together the firm’s legal and industry experts, our process and technology capability, and a scalable range of cost-effective resourcing options in a fully integrated, managed and quality assured offering to deliver results which are aligned with our clients’ needs. Ashurst Advance has acted successfully for over 400 clients on nearly 1300 matters across 55 workstreams globally.

We would be delighted to have a chat with you at the London CLOC institute, so please do come and visit our booth situated in the Ballroom Hall.

As the calendar flips over to 2020, many in the financial services industry are hearing the steady tic toc of the LIBOR clock counting down to 2021 when LIBOR becomes an obsolete reference rate.

Countless contracts and automation processes include LIBOR as a reference rate and over $350 trillion or more than £240 worth of financial agreements reference LIBOR — with more being created despite the looming change. Regardless of these numbers and clear warnings from regulatory bodies and other industry experts to prepare now and not delay, many organisations do not have an articulate transition plan.

Most organisations have begun to assemble multiple internal stakeholders to ascertain the best way to manage the transition. It is not too late to form a LIBOR Task Force, which should also include retained 3rd party providers that bring the expertise needed to develop and manage a transition plan. Executive support and input on Task Force prioritisations are essential and will help to eliminate any roadblocks as the project progresses. In addition, a Program Manager should be assigned supported by, in most cases, several project managers as there are typically multiple work streams requiring oversight. With the right team and project management, a seasoned Program Manager is able to oversee several projects at once, ensure accountability, and meet agreed upon milestones. Organisations that do not have a Program Manager need to fill this essential role immediately. In addition, strong communication at every step of the process cannot be stressed enough and will be a major factor in determining the project’s overall success.

Part of preparedness also means gaining an up-front understanding of the full impact and ramifications of this change. There are many known and unknown variables, ranging from the effect on balance sheets, potential stress scenarios as a result of new reference rates, as well as addressing client response. Whilst many contracts and legal documents contain fallback provisions if LIBOR becomes unavailable, since LIBOR is generally for floating rate transactions and SOFR, SONIA and others apply to fixed rate transactions, it can leave organisations open to potential financial and reputational damages, especially if risk is not properly managed.

Understanding the reverberations before-the-fact is one of the most challenging aspects of any LIBOR transition plan. To pave the way for an informed, cost effective, and streamlined path to compliance that has little to no impact on business as usual, organisations should consider the taking the following steps:

• Assess: Determine any anticipated risks or challenges. To assist in this process, Artificial Intelligence (AI) tools in conjunction with experienced resources can identify what must be transitioned and what supporting materials need to be developed (documentation, systems, fallback provisions, standard operating procedures, limiting new transactions, training, etc.). AI and enhanced machine learning are highly effective in identifying active agreements and pinpointing their contents. This is a complex process that requires both human and technology resources.
• Prioritise: Identify potential issues and bottlenecks so they can preemptively be addressed and remedied. Six Sigma trained resources and applied principles can be highly advantageous during this phase of the project.
• Strategise: Establish a comprehensive and detailed roadmap complete with specific steps, stakeholders, vendors, resources, and procedures. Ultimately, the success of the project will, in large part, be determined by the quality of this plan which should include standardised approaches/playbooks for legal document drafting, remediation, amendment, and outreach.
• Execute: Execution is everything. Deploying the strategy in a streamlined, sensible and diligent way is the final step toward transition. Tracking to the strategic plan will ensure all milestones and objectives are met and compliance is achieved.

No plan can fully anticipate every roadblock or challenge. That is why the transition team must remain nimble; able to pivot and adjust prioritisations as new information and potential risks are uncovered. Paramount to successful execution is also well-articulated communications plan and function, along with rigorous calendar management to ensure all stakeholders are informed and contributors are held accountable.

A well-conceived plan will include the use of third party resources including technology solutions and alternative legal service providers (ALSP). As noted, successful execution will be delivered by a combination of human resources and technology. ALSPs like Integreon are instrumental in working with clients to expertly handle the vast amounts of documentation (contracts, prospectuses, and other legal documentation, as well as marketing collateral and product details) that requires remediation. Any mention of LIBOR as a reference rate must be replaced with agreed upon new language. Some may consider using a law firm for this work, though they may find the price tag to be cost-prohibitive. In addition, law firms do not typically handle, nor are they resourced to handle this manner of project. On the other hand, this is right in the wheelhouse of most ALSPs who ideally will bring deep expertise, access to a large pool of experienced resources, and the technology relationships required to galvanise and execute successfully.

In 2020, financial institutions need to make a New Year’s resolution to start the LIBOR transition process. Although 2021 may seem like a long way away, there is clearly much to be done to fully understand the size of the challenge, properly resource, develop a sound plan, and efficiently execute. Happy New Year and here’s to a happy and healthy LIBOR transition starting…now!

About Integreon

Integreon is a trusted, global provider of award-winning legal and business solutions to leading law firms, corporations and professional services firms. We apply a highly trained, experienced staff of 2,400 associates globally to a wide range of problems that require scale and expertise, enabling clients to become more operationally efficient by streamlining operations, maximizing investment and improving the quality of work they provide their end clients. With delivery centers on three continents, Integreon offers multi-lingual, around-the-clock support, as well as onshore, offshore and onsite delivery of our award-winning services. Visit us at CLOC London on January 20-21 at table 25.

Jenita Gillespie is Director of Legal Operations at Bon Secours Mercy Health. While she was originally hired as a Paralegal eight years ago, her personal path to the directorship is also the story of the transformation of legal operations at Ohio’s largest healthcare provider – a story that highlights the successes that can come with implementing strong, data-driven processes. We recently had the privilege of sitting down with Jenita to discuss how she was able to drive this transformation so other legal departments can learn from her story.

How the Legal Operations Function Evolved

When Jenita joined Mercy Health – prior to its merger with Bon Secours in September 2018 – there was no legal operations department. Using her background in billing for law firms, she began closely analyzing the bills coming into the Mercy Health legal department and realized the department was being overcharged in some cases. While her supervisor initially dismissed her claims, Jenita was able to present data that identified clear discrepancies between what some law firms and technology vendors billed for and the services they actually provided.

After presenting her findings, Jenita began to advocate for a more systematic approach to billing and other operational functions at the Mercy Health. Leadership agreed, and she was asked to oversee the implementation of a legal process management system that integrated data from a variety of applications across the organization. Implementation of that system, which made it much easier for Mercy Health to track, analyze and manage work across multiple workflows, generated initial savings of $1.25 million, and Jenita was subsequently promoted to Manager of Legal Information Systems.

Jenita was thinking well beyond solving the department’s immediate billing issues and began to focus on developing more effective processes in other areas like vendor management and financial management. She gradually began to implement a series of process improvements. One of these improvements was establishing strict guidelines and procedures ensuring that every outside counsel fee arrangement had to be approved by the legal operations department before billing, and that any work billed by outside counsel that had not come from legal would not get paid.

With fee approvals done by legal operations and data from the legal process management system, Jenita’s team was able to carefully monitor bills coming from outside counsel and quickly identify previously unrecognized patterns in billing practices. She was able to catch inconsistent pricing and unreasonable increases that had been overlooked, and decided to implement billing violations to ensure the department would no longer be overcharged.

With increasing visibility into legal spend, she gathered data related to real estate matters and determined the company’s spending well above market rates. Her data and reporting convinced leadership that Mercy Health could spend a quarter of what they were paying to outside counsel by hiring an in-house lawyer to handle real estate. When Jenita discovered that other firms were also failing to bill market rates for other practice areas, she was able to negotiate outside counsel rates down hundreds of dollars per hour in some instances.

With examples like these, and with her entire department adhering to the streamlined procedures she developed, Jenita was able to get support from the Chief Legal Officer of Mercy Health and the finance department to maintain consistency and efficiency in workflows and financial management.

As Jenita’s work expanded to areas like technology and process support, data analytics and business/operations reporting, she petitioned for another promotion to accommodate all her new responsibilities. After consulting resources from the Corporate Legal Operations Consortium (CLOC), she determined the role of Director of Legal Operations encapsulated all that she did, and delivered that job description to her supervisor, who then approved. While CLOC resources were not responsible for Jenita’s promotions, they did give her a more comprehensive view of legal operations, which she was able to communicate to leadership. The resources also helped her show leadership how streamlined, effective and efficient the legal department could be with a legal operations director implementing a strict, data-based approach to process and workflow refinements and providing continuous oversight.

What’s Next for Legal Operations?

Jenita not only discovered new ways to manage spend and streamline processes for the for Mercy Health’s legal department, but she also found additional savings and efficiencies through the company’s merger with Bon Secours – integrating the companies’ information systems and legal operations workflows in just six months. Jenita’s story is an example of what’s possible with the right resources, data and technology. Law departments worldwide should carefully consider how a more systematic approach to legal operations can help them achieve substantial cost savings and efficiency improvements. What was possible for Mercy Health’s law department is achievable for others. Data-based processes and decision-making – driven by go-getters like Jenita – represent a promising way forward for legal departments.

Aaron Pierce is vice president & general manager of LexisNexis CounselLink.

As an important aspect of vendor management, outside counsel billing guidelines are a foundational element of the CLOC Core Competencies. Billing guidelines are one of the key components of good, strong relationships with vendor partners—but sometimes those partners miss the mark by engaging in common billing violations that could hurt your organisation.

Unfortunately, corporate legal departments (CLDs) are all too familiar with this challenge. As billing guidelines become more complex, CLDs are discovering more guideline violations from their outside counsel, some of which can be hard to spot with manual invoice review processes. Often these violations are inadvertent, and the law firm may not even realise that they’re out of compliance with your guidelines. Meanwhile, the CLD is subjected to spend leakage that can result in the loss of millions of dollars per year.

That’s a problem, especially when general counsel around the world are increasingly expected to run their CLDs like a business unit. Corporate legal teams need mechanisms to help them easily identify where the leakage is coming from, and when a billing violation has taken place.

Look for These Typical Violations

It helps to be able to identify the most common violations and their potential impact on the organisation. According to data derived from Wolters Kluwer’s ELM Solutions’ LegalVIEW® BillAnalyzer data, here are five violations that can have a direct impact on CLDs’ bottom lines:

Block billing: Block billing homogenises multiple tasks into a single billing entry. Block billing makes it difficult to correlate work to specific matters. That, in turn, makes it tough to discern how long it took to complete a particular task—a useful guideline that CLDs can use to estimate the length of time and money that should be allocated for similar projects in the future.

Vague task descriptions: Lawyers tend to like a lot of detail in everything, including the invoices they receive. Invoices with vague descriptions lack specificity about the purpose of the tasks completed. Phrases such as “case management,” “attention to file,” or “prepared for staff meeting” billed for 12 hours obscure the details of the work done and can make it difficult to reconcile timekeeping hours or determine compliance with billing guidelines. Ambiguous billing descriptions cannot fully illustrate the connection between the work your outside counsel is doing and the value that they’re adding (or not adding). All of which hurts your ability to display accountability to your organisation’s C-suite.

Violation of core billing guidelines: Certain line items may not follow a CLD’s core billing guidelines. Examples can include duplicate or excessive line item charges, up billing (rounding up time entries to the hour or half-hour, rather than in increments of 1/10 of an hour, which can lead to overbilling), or anything else that may be considered in conflict with the CLDs’ billing policies.

Matter management: Matter management violations occur when a firm disregards a CLD’s alternative fee arrangements or flat fees for a specific matter, or when they bill to the wrong matter. Often, these violations are completely unintentional, but they must be flagged to ensure billing is attributed to the appropriate matter and adheres to whatever fee arrangement is in place.

Late invoices: CLDs are being asked to become highly assiduous when it comes to controlling spend and budgets. Prompt payment of invoices helps keep things on track from a financial perspective. Unfortunately, many firms do not issue invoices on time, often waiting 31 days or more to send out bills. Just as in one’s personal life, a late bill is often considered a surprise bill, and a delayed legal invoice can create challenges for CLDs that are trying to effectively track, budget and plan their expenses.

Bill review processes that use technology to automate and analyse invoice data can flag potential violations and improve compliance with greater speed and accuracy. CLDs can be alerted to potential discrepancies quickly to avoid revenue leakage and maximise their ability to become profit centers for their companies.

If you’d like to learn more about current priorities and trends among general counsel and legal departments, see this summary of the GC Barometer 2019 findings.

About Wolters Kluwer

Wolters Kluwer’s ELM Solutions is the market-leading global provider of enterprise legal spend and matter management, contract lifecycle management and legal analytics solutions. We provide a comprehensive suite of tools that address the growing needs of corporate legal operations departments to increase operational efficiency and reduce costs. Corporate legal and insurance claims departments trust our innovative technology and end-to-end customer experience to drive world-class business outcomes. The award-winning products include Passport®, the highest rated ELM solution in the latest Hyperion MarketView™ Legal Market Intelligence Report; TyMetrix® 360°, the industry’s leading SaaS-based e-billing and matter management solution; CLM Matrix, named a “strong performer” in the 2019 Q1 CLM Forrester Wave report; and the LegalVIEW® portfolio of legal analytics solutions based upon the industry’s largest and most comprehensive legal spend database, with more than $130 billion in invoices.

LIBOR, the London Inter-bank Offered Rate, is estimated to be tied to over $240 trillion dollars of financial arrangements globally – including public and private loans and bonds, credit cards, mortgages, student loans and interest rate derivatives – and will be discontinued by 2021. LIBOR is a reference rate that is calculated daily from voluntary submissions provided by a panel of banks. The panel banks each provide the rate at which they believe they can borrow currency from another bank. When LIBOR is rising, the indication is that banks believe that there is a greater risk of defaulting on loans, thereby necessitating a higher interest rate to offset the potential risk of that default. The rise or fall of LIBOR generally indicates the rise or fall of interest rates.

As a matter of historical interest, LIBOR was first published in 1986, and quickly became the benchmark rate that influences interest payments on a wide range of financial products and contracts. By the end of 2016, contracts based on USD LIBOR totaled nearly $200 trillion in gross national exposure, according to the New York Fed. Last year, Bloomberg reported that LIBOR underpinned $370 trillion in contracts globally.

LIBOR had been under scrutiny for some time, by some accounts as early as 2003, as accusations and later investigations revealed that certain panel banks were dishonest in their submissions to manipulate LIBOR to make profits. The validity of LIBOR was challenged by these scandals and more so, after billions of dollars of fines were levied by regulators against panel banks proven to be involved in LIBOR manipulation. As a result, many panel banks were deterred from further participation with LIBOR and its use as a widely regarded benchmark has fallen out of favor. In 2017, it was announced that LIBOR would not be sustained after 2021. The impact of the LIBOR is widespread, and market participants will be impacted from consumers, businesses, investors, to banks and countless others.

Many adjustable rate financial products are tied to the performance of LIBOR. Now that LIBOR is going away, many questions arise such as what will dictate my interest rate after LIBOR? Does my contract have a fall-back provision? Similarly, businesses big and small will need to identify contracts that are tied to LIBOR and ask themselves similar questions to assess risk and navigate the course of action moving forward.

If your legal department is losing sleep over the sunsetting of LIBOR take heart. Although you may have a large volume of contracts to repaper before this financial industry benchmark becomes obsolete at the end of 2021, you can put systems and partners into place now to minimize the workload and stress on your team.

What can you do to prepare?

1. Identify. The first step of the process will necessarily include identification of all contracts referencing LIBOR. Considerations during this identification phase include: (1) whether there are any exceptions that need to be addressed to ensure an exhaustive search; (2) whether there is a way to systematically identify those contracts where the LIBOR reference does not require further action, i.e. the maturity date of the contract is prior to 2021; and (3) how you will determine, upon identification of the universe of LIBOR contracts with potential impact, the priority order of contract review by contract type/customer; topping the list should be those contracts that will need additional time for renegotiations and internal systems compliance.
2. Review and analyze. Once all contracts referencing LIBOR have been identified, those requiring additional action will need to be reviewed and analyzed to assess LIBOR implication, fallback provisions and whether contracts will need to be renegotiated.
3. Determine next steps based on categorization. Examples:
   • Contract needs no further action; it is not impacted by the LIBOR transition.
   • Contract can be amended by a letter to the customer with updated terms. Customer contact information must be extracted, and a template letter prepared and sent to the customer with updated terms. Internal systems modification must be initiated to ensure systems compliance with updated terms by the date designated in the letter.
   • Contract needs to be renegotiated in accordance with the LIBOR replacement. Customer contact information must be extracted, and a notification letter prepared and sent to advise the customer of the pending renegotiation. Create a playbook for renegotiations and the associated process.

How will you get it all done?

The sheer volume of time and attention this task could require may at first seem overwhelming. Most legal organizations run lean to begin with; adding another project, especially one that will likely require a dedicated project team, is the last thing you need.

Fortunately, an alternative legal service provider (ALSP) can provide you with a team equipped to carry out project management, training, workflow design, labor and delivery of the amended contracts seamlessly so that you don’t have to tie up your own attorneys and paralegals. They can continue working on priority projects, as the ALSP manages your LIBOR-related activities.

Your ALSP partner should provide you with:

• A dedicated resource team that includes paralegals and seasoned practitioners with a range of skills that enable an end-to-end solution. Team members should be prepared to assist at every stage, from the identification phase through repapering efforts, using your chosen technology.
• The workflow design, a substantive training protocol/playbook and training modules. Workflow design is critical to ensuring that similar contracts are treated in the same way from a process perspective through a logical, documented, defensible approach. Training ensures that every person working on the project has a roadmap for dealing with various contract provisions and conditions.
• Project management and quality control. Skillful project management and a rigorous quality assurance process are essential to ensuring accuracy and defensibility of process.
• Efficient and cost-effective work product delivery. An outstanding ALSP will work to keep your costs down and efficiency high by streamlining processes, leveraging technology and allocating resources to functions accordingly, as a means of cost control.

About Tower Legal Solutions:

Tower Legal Solutions is a WBENC certified women-owned alternative legal services provider that focuses on project staffing, temporary attorney engagements, and managed services. Our specialties include secondments, managed review, contract management and direct hire placement. Our clients can count on transparent and value-added people solutions that solve staffing challenges and optimize efficiency.

You can have any color you want, as long as it’s black. Ford’s Model T was a classic example of a market-creating blue ocean strategy that allows companies to unlock new demand. For centuries, people were content with horse and buggy until Ford showed people what they were missing.

Currently, some in-house lawyers fear the idea of having the outside counsel engagement process wrapped up into the auspices of their enterprise’s competitive bidding policies. However, they desire all the benefits that competitive bidding provides. Namely, driving for more competitive rates, obtaining cost predictability, and gathering qualitative insights into how the firms plan to strategically approach the engagement. So, why the disconnect?

“I think that it is a good concept and could work well for simple, repeatable cases, but all my cases are really complex commercial litigation matters so I don’t think an RFP really makes sense for me,” If only I had a dollar for each time I heard that excuse….

Today, the role of legal operations has been more frequently tasked with finding opportunities to run RFPs and this task can be challenged by push-back from managing attorneys. While there are many use cases for RFPs that include establishing a panel of firms company-wide or by practice area to properly align the selection of firms with their greatest area of expertise, among other considerations, bidding to select firms for a specific case is less common. There are many common misconceptions amongst managing attorneys about competitive bidding aka RFPs aka Sourcing on a matter-by-matter basis. The most frequently cited misunderstanding is that RFPs and competitive sourcing only work for commoditized work and that the greater the risk or complexity within the case or project, the less workable the case is for an RFP. However, RFPs are a great means for selecting firms in complex litigation matters for 3 key reasons:

1. More Competition and Firms’ Desire to Work Big Cases

The first reason complex litigation matters are ideal candidates for RFPs is that they are big and sexy… No, seriously. The complex nature of the work necessarily means that there is likely to be a greater amount of work involved. With more revenue potential for the firms, there is a greater incentive for firms to provide added discounts in order to earn the selection. Also, firms want the assignment so they can tout high-profile case outcomes to other clients. Therefore, a competitive selection process is more likely to be fruitful in these cases than in simple projects because firms want the business more and are more willing to lower their fees to win the assignment. This can lead to multi-million-dollar savings for the client in a single RFP. Clients completely lose out on these savings by sticking to the status quo – simply selecting their panel firms at preexisting, “discounted” rates.

2. RFPs can account for ambiguity and define price in case of change

Projects don’t have to be simplistic in their scopes of work to be candidates for an RFP. RFPs can be set up in a way where you account for the ambiguity that comes with complex litigation matters. One of the reasons that hourly billing is so pervasive in the legal industry is because of the ever-changing nature of litigation matters, whose timelines are heavily dependent on external variables – such as the whims of the judge. For this reason, the industry has (despite all its proclamations to the contrary) resisted AFAs. It’s just easier to get the firm started and have them bill you at what you’re told is ‘competitive’ hourly rates (but do not really know for sure?). However, the rate is only half the equation. And negotiating an hourly rate can be like squeezing the center of a tube of toothpaste – as the rate decreases, the firm can easily make up the difference on the backend by billing more hours.

Selecting a firm immediately without requiring the firm to submit a fixed fee proposal amongst competing firms causes the client to lose all leverage. Once the firm is engaged and the longer they are engaged, the less leverage the client has to negotiate a lower rate or to implement an AFA later on. That’s because firms know that the learning curve to bring in a new firm would be costly to the client. For this reason, its critical to run an RFP at the start of a new matter or project so that you can obtain a fixed fee proposal that provides price predictability for the duration of the case. In contrast, hourly budgets are horribly inaccurate and provide zero price predictability. With a fixed fee proposal obtained in an RFP, clients can get the total price while defining the types of changes that would trigger a “material deviation” (for example – a 30% increase or decrease in the number of these 5 key activities). After defining these triggers, the parties can also agree on how much it will cost to add additional activities into the scope (i.e. $100,000 for each additional motion to dismiss) and how much the total will be reduced if they are removed from scope. In this way, you can use the RFP process to obtain overall price predictability whilst also ensuring that you have an easy mechanism for making adjustments.

3. RFPs allow clients to set expectations for staffing and strategy upfront

A third reason RFPs are great for selecting firms in complex litigation matters is that they help the client set expectations early on. Expectations can be defined in the RFP in several areas such as a client’s preferred staffing mix, definition of a successful outcome, and preferred vendors and billing guidelines. Further, clients can define the level of seniority that it prefers to handle various tasks (for example – no first- or second-year associates on expert depositions). This allows the firms to provide pricing based on common assumptions so that the client can truly compare apples-to-apples total fee proposals. Also, it ensures that the client has set the right expectations before the work begins, which allows them to avoid time-consuming and difficult conversations that might occur during hourly invoice review.

You can have any AFA you want, as long as it’s competitively bid

Although the terminology, “Request for Proposal,” comes from procurement, where the purchase of commodities used to be the department’s only charter, the process is something that greatly benefits corporate law departments. An RFP doesn’t have to be a 60-page, lengthy exercise that is designed to evaluate whether a company “qualifies.” It can be a short 5-10 question template with pricing obtained at the phase and/or activity level that is sent only to panel law firms that the client has already ‘pre-qualified’. This streamlined process can then be replicated on a matter-by-matter basis such that panel law firms get into a rhythm of bidding for each case and can provide their best price during periods when they have their greatest capacity – creating a win-win scenario for both the firm and the client. By dispelling the misconceptions about the proper use of RFPs, the legal industry can move away from the misery-induced billable hour and towards a fair, transparent selection process. Clients can let the market dictate the true price of the work. This would allow them to spend less time worrying over hourly rate hikes and invoice review while achieving the budget predictability that CFOs have been asking of their GCs for decades.

About PERSUIT

PERSUIT™ is a Software as a Service (“SaaS”) company specializing in legal services sourcing technology. Founded in early 2016 by Jim Delkousis (a former BigLaw partner), PERSUIT was designed to be easy enough for in-house attorneys and law firms to use with little to no training. The tool is self-service enabled and is an out-of-the box, cloud-based software application, providing corporate law department attorneys the ability to launch Requests for Proposals (RFPs), Requests for Information (RFIs), Hourly Rate Information Requests, Panel Counsel Inquiries, and Alternative Fee Arrangements (AFAs). Each request type can be set up to drive price competition amongst participating law firms such that true market price is achieved. PERSUIT is reinventing the way companies engage with outside counsel with a mission to Kill the Bill(able) hour in favor of outcome and value-based fixed and certain pricing models. Have questions? Reach out to David@persuit.com or visit our website at https://persuit.com.