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‘You’re All Shiny New Toys and No Platform’ – The Inevitable Rise of the Platforms

This is 2019!

Finance, tax, HR and sales functions typically operate and deliver their services using dedicated platforms. Whether based on SAP, Oracle, Sage, Workday, Salesforce or other systems, these platforms provide the workflows, processes, templates and essential operational data that make efficient and successful operations possible.

The functions that use them know what work they have, where it is coming from, what its value/risk is, who is handling it, how long it takes, why it closed. Their leaders have insight through real-time and trend dashboards and reports that allow them to manage their teams tactically and strategically, driving transformation. They have the means to support and, where appropriate, lead decision-making at the executive level.

Lots of shiny toys and no Platform. It is remarkable that this position exists in 2019 when data is the new oil and digitisation is a driving organisational strategy.

Until recently many professional services firms, and particularly law firms and corporate legal departments, had no access to comparable platforms. Only point solutions such as case/matter management, e-billing, and document review were available. As a result, neither comprehensive operational data nor structured work management was in sight.

Lots of shiny toys and no platform. It is remarkable that this position exists in 2019 when data is the new oil and digitisation is a driving strategy. This also presents significant opportunities.

Flying blind while burning fuel

There are few corporate legal departments and law firms who know all the work they have, how complex it is, where it is coming from, who is handling it, how long it takes, or why it closed. On a cross-department, global basis, their leaders lack the real-time and trend data to allocate work effectively (internally or externally), manage risk, improve processes, pre-empt issues, reduce costs, and improve internal and external customer experience. In a quote I wish I had made Mike Naughton of Cisco puts it this way:

“Flying blind while burning fuel has been the legal services norm.”

The rise of the Platforms

This is all beginning to change with the rise of Legal Operations Platforms. These technology platforms, tailored (or preferably configured – see www.ask.kim) to legal and related areas, provide law departments with the equivalent operational advantage currently held by their finance, tax, sales and HR colleagues. By “enabling” the legal function, they allow it to develop and embed a true Legal Operating Model (‘the way things are done around here’), into a scalable technology that integrates with other enterprise-wide systems and point solutions.

They deliver market, customer and strategic relevance through actionable data. They capture quantitative and qualitative data that transforms corporate legal departments. They turn legal data into business insight and free and protect legal team members by helping them make better and quicker decisions, pre-empt risk, and focus on work that makes a difference to the business that they serve, protect and enable. The data changes what work the department does and does not do, what is self-served, what is re-directed and what is done internally and externally. It changes the legal value chain materially.

The data changes what work the department does and does not do, what is self-served, what is re-directed and what is done internally and externally. It changes the legal value chain materially.

These new platforms fundamentally change the legal market supply and value chains. As GCs and Legal Operations teams come to understand and rely on data, they learn how to make informed decisions about how they can best support the tactical and strategic objectives of their business. As well as advisers and business partners they become managers of legal service delivery, designing who should do what work and where, whether internally or externally. It also helps them decide what work should, critically, not be done by expensive lawyers. The General Counsel’s Office now has its platform and the data it generates pushes the department, sometimes against its instincts, to the heart of decision-making.

Learning from house builders

A useful way to think about how to start to build a Legal (or other function) Operations Platforms is to imagine a house. A house has foundations, rooms and a roof. The foundations provide stability and scalability. Individual rooms such as the kitchen and the bedrooms serve different purposes. Each room has a different layout, furniture and colour scheme. The roof protects the house and can be used for storage and/or converted to provide more rooms. The house can be extended.

Critically, the rooms and the roof are built on the same foundations and it is the people plus the utilities (e.g. plumbing, electricity, broadband … etc) that bring the house alive.

Applying this same analogy to legal and related work:

  • Foundations: This is the process and integration layer (see Diagram 1 below). For any work type (e.g. employment, commercial, claims … etc) this layer manages instructions, work allocation and integration with other systems. All work types require this foundational layer because all work starts with a request/instruction, just as all rooms in a house need the foundations. The foundation layer also supports integration with other systems just as the foundations of the house support plumbing and electrics.
  • Rooms: This is the application and work layer and it should be configurable (not coded) to any work type. Just as a room in a house has different colour schemes and furniture, different legal work types have different templates, documents, workflows, case statuses and dashboards. Rooms are configured to each work type built on top of the foundation layer.
  • Roof: The roof is enabled by the ‘context’ provided by the Foundations and the Rooms. Via the Foundations and the Rooms, the platform has metadata specific to a customer (e.g. it’s business units, its work types, its case statuses, its templates, clauses … etc). This provides context and enables, for example, the management of contract risk in-flight with each version of a contract RAG rated with appropriate percentage compliance against the customers preferred positions.
  • Utilities and People: The organisation’s people (e.g. business users, legal team members … etc) bring the house alive. Combined they submit requests and work on them to deliver desired business outcomes. By doing their job they add to the context that enables the roof. Seamlessly they also use third-party tools such as DocuSign and Salesforce to make their lives easier.

Diagram 1:

EYRVL-pic

Unglamorous, unappreciated and absolutely critical

If you have ever watched a house being built from scratch two things will probably have struck you.

Firstly, a long time seems to pass with very little progress being made even though there is a large team on-site. Then, suddenly, when the foundations are finished, the house takes shape remarkably quickly. One morning the site was just concrete foundations and groundworks and the next day the house starts to emerge, proudly, from its rock-solid foundations. It is almost as if it is saying ‘I was always here but you couldn’t see me’.

Secondly, in those weeks when you saw little progress being made you were probably struck by how small the building footprint appeared to be, assuming that a relatively small building was being constructed. But, when the house starts going up, you are amazed by how big it is. In legal, they provide the ‘Foundational Data and Context Layer’.

Foundations are not glamorous. They are not always recognised or appreciated. But this does not make them any less critical. They provide scalability, sustainability and, critically in this digital age, ‘context’.

Using the instruction and allocation process as an example, the foundational layer includes data points that show:

  • Who the instruction came from (the Instructor);
  • What business unit/division the Instructor is in;
  • What the work type is (primary, secondary, tertiary);
  • What the urgency of the work is;
  • Whether the instruction is complete;
  • When it was received by legal;
  • Who it was allocated to;
  • What the current status of the case/matter is;
  • How long each stage of the work took;
  • Why the case was closed… etc.

This provides business context.

The foundations and rooms can be ‘re-decorated (i.e. changed to reflect new workflows, templates, risk profiles … etc). Extensions can be added such as new rooms or new, connected, houses. Third-party tools can be integrated with the platform, just as people buy different products for their own houses to match their style (culture) and needs (strategy).

After all, how can you evolve the corporate legal department if you cannot answer questions such as what work do we have, where does it come from, who did we allocate it to, how long did it take and why did we close it?

The legal function does not sit in isolation from the rest of the business. Using the Platform Legal can connect, seamlessly, to the rest of the business through people and utilities.

Each room (work type) built on the foundations is connected to the end-to-end processes for that room producing data that is available as appropriate across the enterprise). For example, in a contract and lifecycle management Room:

  • the foundations provide the core data layer/context (business units, work types … etc) and integration layer (applicable to all rooms irrespective of work type);
  • the contract and lifecycle management room then operate with the end-to-end process by being configured to contract management but integrating with:
    • the sales team (e.g. which may use Salesforce in this example);
    • contract approval and signature (e.g. DocuSign – or whatever the organisations e-signature tool is);
    • finance (e.g. SAP for revenue recognition in lifecycle management); and
    • whatever other ‘utilities’ the organisation uses in all the other departments/functions.

Put another way, the horizontal foundations across the legal function enables vertical (through the business) end-to-end processes.

The power of a Global Legal Operations Platform. The benefits of building from the foundations up, not the roof or rooms down.

The direction of travel is clear

Many drivers are building momentum for this evolution in how and where legal work is performed: increased competition across all sectors, the dynamic world of legislative and regulatory change, cost-up and price-down pressures, digital disruption, technological innovation (including but certainly not limited to AI), and law firm inertia. The arrival of new entrants, particularly the Big Four, and the way they change thinking and use data should not be under-estimated.

The corporate law departments that grasp this will, quietly, quickly and unassumingly, move to the heart of business decision making and strategy. Their teams will be freed to become business enablers.

There will be an inevitable growth in work retained by corporate legal functions. While this leads to a material reduction in work undertaken by traditional law firms it does not mean a commensurate increase in in-house legal team numbers. Self-service, technology and dashboards will drive significant productivity gains.

Corporations’ enterprise-wide focus on data, from which legal operations are not immune, plus outsourcing to innovators and increased competition from the Big Four, will which will provide customers with greater choice will accelerate this trend.

All roads lead to function-wide legal operating models and platforms, not point solutions. To the legal data layer, not spreadsheets.

The direction of travel is clear. Customers are the winners.

Karl Chapman is a director of Kim Technologies (www.ask.kim) and was the founder of Spring Group plc (acquired by Knowledge Universe in 1996), AdviserPlus Business Solutions Limited (acquired by Limerstone Capital in 2017) and Riverview Law Limited (acquired by EY in 2018). Extracts of this article were first published in 2017 and 2018. All views expressed are the personal views of Karl Chapman.

Karl Chapman

Karl Chapman

EY Riverview Law and Kim Technologies
Karl is Strategic Adviser at EY Riverview Law and has a long pedigree in starting, growing and managing successful companies. In 1987 was Money Observer’s top-performing UK unit trust fund manager. In 1989 he set up CRT Group plc which grew to a market capitalisation of over £600 million. In 1996 CRT sold 50.1% of its equity for £109 million to Knowledge Universe, a private US-based company. In 1999 Karl left CRT and set up AdviserPlus Business Solutions in 2001. He remained as owner and non-executive until its sale in 2016. Karl joined Riverview Law, a legal services business, as Chief Executive in 2011 following its creation by AdviserPlus. Riverview Law was acquired by EY in August 2018 and Karl is a Strategic Adviser to the company. Karl is a Director at Kim Technologies. Kim is a leading no-code, configurable technology platform that helps organisations automate their workflows, case management and documents and is applicable to all sectors and functions.