Increasing internal visibility

One of the pressing issues facing in-house counsel is how to demonstrate the value of the legal team to their organisation. Darise Ogden spoke with in-house counsel to find out the strategies they’re using to raise their internal profile

Lawyers, says Team Factors Ltd director Ron Pol, are excellent at delivering value. However, according to him, they’re not quite so good at demonstrating this value in ways that resonate directly with their clients’ needs.

In the Legal Department Benchmarking Report 2008 (Report), respondents to the research study undertaken by Team Factors on behalf of the Corporate Lawyers Association of New Zealand and the Australian Corporate Lawyers Association indicated that demonstrating value was one of the “pressing issues” facing in-house teams. The issue for many is that they simply do not know how to demonstrate value and tend to hope their results speak for themselves. But as Martin Hunter, General Counsel of IAG New Zealand Limited, and Tania Turfrey, Director, Legal Business, Department of Labour (DOL), explained to me, demonstrating value is about so much more than just sitting back and expecting the business to be in awe of the outcomes achieved by the internal legal team.

Back to basics
Getting the fundamentals right is the first step towards demonstrating your value to an organisation. And getting them right, says Hunter, means that your legal department has its accountabilities and roles fairly well clarified and that the business (from the CEO to the lowest level people in the business) understands the role of the general counsel and knows who in the legal team has the requisite capabilities and experience to help them with their legal issues.

Next, Hunter says you need to do the traditional in-house work well, ie managing compliance, negotiating contracts, doing product work, advising on marketing and consumer protection issues, looking at internal policies and procedures, managing litigation, and talking to external lawyers. Doing it well means providing these essential legal services in a cost-effective way, he says, and making sure your advice is timely, commercial, and pragmatic.

Doing it well, however, may not be enough. “You can sit back in a siloed, isolated role waiting for instructions to roll in, reacting to them, throwing them back out the door, and if you’re doing so cost-effectively, [and] your advice is correct and clear, then the business will be relatively happy with you,” says Hunter. But, he argues, that doesn’t really add any value to the business, and it certainly does not move towards what he considers to be a best practice model – really knowing the organisation and its business.

You just don’t understand our business!
Generally, says Hunter, feedback obtained from internal clients has two reoccurring themes: you’re doing a good job, but at times I don’t think you understand my business; or you’re doing a good job, you’re across my business, but I wonder if you understand the broader organisational issues. It’s a subtle difference, he says. In a best practice model, the business is looking to its in-house lawyers to “look across the organisation”, identify issues that may be caused by one business unit in relation to another, and “bridge the gaps”.

And how do you get to know your clients’ businesses so well that you can identify when plans designed for one business unit could impact on another? By getting out and speaking to the various business units. DOL lawyers go out to the Labour Inspectorate offices or the Health and Safety offices and work with them when they’re compiling a prosecution file, says Turfrey. Hunter emphasises the importance of building relationships: “I encourage my guys to get out from behind the email, get on the phone, go and see people. Go and see the marketing guys, sit in their brightly coloured marketing space, get amongst it, go and sit in a call centre and listen to some of the calls that the call centre guys have to deal with.” If you’re doing that, he says, you’re being more visible, and you’re potentially more efficient in the way you get and clarify your instructions and deliver your advice.

Having an overarching view of the business enabled the DOL team to identify that principles developed for one business unit could also be applied to other parts of the business. It has also established an enforcement prosecution panel, comprised of people across the business, including an in-house solicitor, which reviews a number of recent cases, extracts the “learnings” from them, and feeds them back into the business. The team uses this information to monitor whether its processes have become embedded, or whether the system has changed and/or improved. “It’s a slow process,” says Turfrey, “but those are the sort of things that we really like to be involved in and like to see happening.”

Spreading your “good work story”
One of the best ways of demonstrating your value is, of course, to let people know how well you are doing. However, the idea of blowing one’s own trumpet to all and sundry can seem a little distasteful, and is something from which lawyers (both in-house and external) shy away. Says Pol, “Some lawyers seem least willing to demonstrate the value they have delivered lest it be seen as self-promotion. The reality is that it is as vital a part of the process for any lawyer who wants to remain truly connected to the client perspective.” Pol describes it as a “classic virtuous circle”: “Demonstrating value allows you more efficiently to identify and deliver that value again and again”.

The DOL team has embraced “marketing”, although Turfrey admits that, at this stage, they’re not particularly good at it. In addition to maintaining a complaints and compliments file, they also try and promote their good work stories by making a big deal of the work they think has gone particularly well because of early engagement with the legal team, and by publishing the “good work story” on the team’s intranet page. It’s not about blatant self-promotion, but rather about highlighting the importance of early engagement and the ability of the in-house legal team to influence an outcome.

Spreading the word, however, can be difficult when time constraints work against it. One of the respondents to the Report remarked that there was simply no time to demonstrate the legal team’s value to the organisation due to workload and time pressures. Turfrey echoes this sentiment, saying: “It’s the usual story, sometimes the day-to-day busyness does crowd out a lot of that good stuff that we see going on...”

Going beyond the fundamentals
Pol has noticed a transition from the fundamentals of in-house practice towards a more proactive service delivery model. Under such a model, he says, the legal team actively sets up and delivers training programmes, checklists, and templates to help the business avoid, or more effectively manage, legal issues before they arise.

The DOL team does a lot of training, says Turfrey, and they try to go out into the business to do it. “We do training on decision making, and we’ll actually go out to the immigration branches and train them in front of their workplaces, their workstations, and highlight the various aspects of decision making that they need to be aware of,” she says.

Internal clients are a captive audience, says Hunter, but they do not expect to be treated as a captive audience or a captured client. Instead, they expect their in-house advisers to be the same as their external lawyers: proactive, trusted advisers. He suggests in-house legal teams should not only take a look at the way external firms approach their clients but also adopt some of their practices. “The simplest of examples,” he says, “is to … issue the odd newsletter or communication about pending regulatory developments.” It’s an example the DOL team has implemented. They try to be proactive on legislative changes, says Turfrey, issuing one-page summaries on how such changes might affect parts of the business. And they have also created templates for their internal clients: “we’ve got some standard contract templates that our clients can … use, and then we review the contracts that they put together”. Recently, they’ve extended these templates to include affidavits for their immigration officers.
 
Reporting lines
In the Report, an Australian public sector general counsel is quoted as saying: “Reporting lines within an organisation are very important in terms of profile raising and effectiveness of role. A direct reporting line to [the] MD/CEO is most desirable”. The research carried out by Team Factors showed that, in New Zealand, 41 per cent of the respondents reported directly to the chief executive (or his or her equivalent, ie Minister, chairman, or board). The DOL team, through its deputy secretary legal, reports directly to the organisation’s chief executive and is part of the senior leadership team. Hunter does not, reporting instead through IAG’s Chief Financial Officer.

Even if an internal legal team does have direct access to the organisation’s executive team, there is no guarantee that this will remain the case. The structure of organisations change; therefore, a savvy in-house team needs to do more to maintain its visibility within the organisation than simply relying upon the goodwill enjoyed by its current general counsel. Says Hunter, “As a team, if you can run a tight model that is doing the traditional stuff well, but at the same time really understands your client’s businesses … and also you’re across the broader organisational issues, you stand in a very powerful position to really add some value to the business.”

NZLawyer, 4 April 2008