The legal department of an organization is responsible for providing crucial legal support and advice to the company's various business operations. However, to operate efficiently, the legal department requires effective management in several areas, including project and program management, firm and vendor management, and financial management. Without proper management, the legal department may lack clarity, predictability, and accountability, leading to unexpected shortfalls and tensions within the business.

In part four of our five-part Legal Ops blog series, we’ll take a look at how to improve the management of your legal department.

Project / Program Management

Effective project and program management is critical to the success of any initiative within a legal department. However, many corporate legal departments lack the specialized program management skills and experience to implement effective initiatives at scale.

Corporate legal departments can achieve successful design, implementation, and leadership of department-wide and company-wide initiatives by staffing their program teams with trained project managers rather than lawyers. They must also design change management efforts that make the best use of their people and resources, engage and communicate with stakeholders across the company, and comply with corporate initiatives without compromising the quality or volume of ongoing work.

Firm and Vendor Management

Developing strong relationships with external law firms and vendors is also essential for achieving operational excellence. However, in-house teams may default to traditional pricing and staffing models, which can deliver less accountability and value due to a lack of clear alternatives.

In order to establish and maintain healthy relationships with business partners and vendors that meet the needs of the company, legal departments should create well-designed and fair RFPs that reflect their business goals. Negotiating rates and pricing models that incentivize positive outcomes, conducting structured business reviews to improve transparency and accountability, exploring new opportunities for collaboration, and performing due diligence on potential vendors are all essential steps to avoid conflicts and ethical issues.

Financial Management

Finally, financial management is a critical component of legal operations. Without a strong and sustainable approach to financial management, legal departments may operate with little clarity or predictability in their budgeting, which can lead to unexpected shortfalls and tensions with the business.

In order to effectively manage financial resources, legal departments should focus on developing, managing, and communicating their budget. They should also design a process for accrual and forecasting that fits their team, identify new opportunities for saving and improving efficiency, bring more consistency to their budgeting and financial planning, improve communication and compliance with their corporate Finance department, and handle their e-billing with accuracy and efficiency.

Conclusion

Proper management of legal departments is vital for the success of any organization. By prioritizing project/program management, firm and vendor management, as well as financial management, legal departments can operate effectively, transparently, and accountably, leading to better outcomes for the organization. It is crucial for these areas to be given priority to ensure that legal departments meet the company's business goals and operate optimally. With the right management approach, legal departments can continue to provide valuable legal support and advice to their organizations and ultimately contribute to their overall success.

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