Leading in-house legal teams develop roadmap for the future

• Three quarters of law department leaders expect no growth in headcount over the next 12 to 18 months, yet nearly two thirds (64%) predict workloads will increase by up to 30%
• Balancing peaks and troughs in demand across business units and advisory areas therefore presents unique challenges which go beyond 'more for less'
• 61% of law department leaders confirm they have realigned their legal operating models in response
• To meet business needs/wider objectives law department leaders are now zeroing in on technology, data and communicating value

A new research report by global law firm Ashurst, in association with OMC Partners, found that 61% of law department leaders have realigned their legal operating model in response to strategic changes made by their companies, reflecting the rise of digitisation and remote working combined with increasing stakeholder demand for responsiveness and transparency.

The report, Legal Operations - the shape of things to come, compiles the views of law department leaders from across eight core sectors on the range of approaches that they intend to implement over the next 12 to 18 months as they emerge from the Covid-19 pandemic.
The research explored attitudes towards embedding new and often radically different operating models that blend digital technologies, increased stakeholder demands for flexible working, and shifting sentiment in terms of the role offices play in collaboration and innovating.

It showed that nearly two thirds (64%) of respondents predict workloads will increase by up to 30%, with regulatory, data protection, employment and ESG-related work driving this demand. Yet, 75 % of those surveyed expect no growth in headcount, and more than 40% of respondents also plan to reduce spend by up to a third. Given this dynamic, balancing peaks and troughs in demand across business units, territories and advisory areas presents unique challenges for law departments unable to adapt rigidly focused resources. Law departments are therefore rebalancing their operating models to reflect this new environment.

In order to bring together a more integrated approach to transformation, which goes beyond the cost and resource equation, law department leaders are zeroing in on technology and data to drive value for the business. However with budgets for technology investment remaining limited, teams are looking within to see what technology already exists and how they might better leverage it rather than buying new technology. Respondents are also using this tech to drive decision making, signifying that operations is set to become more reliant on meaningful, rich, accessible data.

The research also identified a change in attitude towards office space with three quarters of participants planning to revisit their teams' real estate needs. Of those, around 70% intend to remodel and optimise office space to enhance project work, collaboration and short-term social distancing, while 50% are looking to streamline their office footprints.

As teams become more complex and spend pressures grow, more organisations will turn to legal operations, as reflected by the around 30% of respondents considering adding Legal Operations Managers roles over the next 12 to 18 months. Augmenting team skill sets is also high on the agenda, with 50% of law department leaders looking to enhance their teams' skill sets, with legal tech and spend management capabilities the key areas of focus for 2021.

Helga Butcher, Ashurst's head of legal project management and legal process improvement, commented:

“The effects of Covid-19 on working practices across every industry cannot be ignored - bringing with it an even greater focus on ways of working and transformation. This has provided a unique opportunity for legal operations teams to really demonstrate their value as a result of the need to be more agile and streamlined.

"There is no ‘one size fits all’ when it comes to transforming legal operating models. Our research has shown that law department leaders are developing a blend of cost reduction, efficiency and productivity approaches to their transformation programmes. Building on the adaptive mindset we have seen throughout the pandemic and embracing alternatives to the status quo will be key to meeting increasing demand for new ways of working."

Matt Peacock, Managing Partner, OMC Partners, said:

"With intense pressure to reduce spend (external and internal), headcounts remaining static and the rapid growth in specialist areas such as ESG investing, law department leaders are clearly faced with a challenge as teams look to pivot existing resources to meet this shifting demand. Key to this will be adopting a more balanced blend of resource, whilst retooling their existing teams and developing a broader legal operations skills mix to keep up with growing demands for proven technologies, data driven decision-making and project management."

Chris Georgiou, global head of Ashurst Advance, added:

“This report highlights the opportunities for law departments as they seek to emerge from the pandemic streamlined, match fit and delivering value to their stakeholders. There are lots of possibilities. It is now vital that we embrace and adopt all the lessons and positive changes which have come out of our new ways of working.”