3 Key Takeaways from Corporate Legal Operations Consortium (CLOC) Europe

Kevin Clem | May 05, 2017

With the 2017 Corporate Legal Operations Consortium (CLOC) Institute just around the corner, leaders in legal operations are gearing up to spend three days sharpening their legal swords and networking among industry thought leaders. HBR is proud to be a Platinum sponsor and I look forward to seeing many of our clients, partners and friends there.

The CLOC was founded in 2016 to better share knowledge and best practices among legal operations professionals. The organization allows professionals to network and discuss challenges. Since its inception, CLOC has grown rapidly, having hosted several successful meetings, including the 2016 CLOC Institute in San Francisco.

At the end of February, I had the pleasure of attending the inaugural CLOC Europe meeting, which took place at British Telecom’s offices in London. Twenty-five leaders of European law departments gathered for the first of four 2017 roundtables to discuss common operational and management challenges for in-house legal departments. The goal was to mirror the success of CLOC in the U.S. and bring legal operations professionals together, share best practices, and drive positive change across the corporate legal operations ecosystem. As we did at the 2016 Institute, HBR conducted a live survey to assess attendees’ maturity around CLOC’s 12 legal operations core competencies, co-created with fellow ecosystem members Jeff Franke and Pratik Patel.

Here are three key takeaways gleaned from the survey results at CLOC Europe:

  1. U.S. law departments lead in strategic planning. The CLOC maturity survey of U.S. and European legal professionals revealed strategic planning efforts are more mature among U.S. legal departments. We consider strategic planning to be a foundational operations competency, and this disparity is likely due to the relative maturity of the legal operations role in the U.S. HBR’s 2016 Law Department Survey indicated more than half (56 percent) of law departments now have a dedicated legal operations professional, and this number will likely continue to grow in the U.S. and abroad.Best practice strategic plans should address resource allocation and optimization, talent management and development, process and technology optimization, and a clear focus on client / business alignment. These multi-year, metric-driven plans should be monitored through quarterly reviews to reflect the progress toward stated goals.
  2. European law departments lead in outside counsel and vendor management. The survey found outside counsel and vendor management practices are more mature in Europe than the U.S., likely due to more established partner management programs (panels). These panel programs ensure organizations select the appropriate outside counsel and vendors at the right price point and under optimal fee arrangements. European law departments with best in class vendor management programs hold regular business reviews with their partners, use a well-defined data-driven process to establish matter budgets, and identify alternative fee arrangement opportunities.
  3. Knowledge management and data analytics capabilities are low across the board. Law departments are no longer expected to simply serve their internal clients’ needs on a one-off basis. Instead, they are increasingly expected to serve as stewards of their company’s knowledge. As law departments undergo this cultural shift, it is increasingly important that they are able to harness the collective knowledge and insights of the whole department. This is especially true as more law departments focus on keeping work in-house.

    Knowledge management tools are no longer just “nice to have.” In fact, our 2016 Law Department survey found 25 percent of law departments are looking to implement a document management system in the next one to two years. These tools enable efficiencies by creating seamless access to legal and institutional knowledge, as well as centralize key templates, policies, processes, memos, and other learnings. True knowledge management, however, is as much a cultural challenge as it is a technological one. While sophisticated technology to capture the information is a critical foundation, the relative immaturity of knowledge management as a discipline is likely due to the significant change management considerations and individual accountability required.

    Similarly, forward looking law departments are aiming to improve their data analytics capabilities. While 39 percent of law departments currently have spend analytics technology, another 24 percent are looking to implement the technology in the next one to two years, according to our Law Department survey. Data analytics platforms pull data from various department tools and industry sources to provide a ‘single pane of glass’ view of the department. This in turn allows operations professionals to drive efficiencies and optimize spend. The growth of artificial intelligence (AI) technology will continue to expand the opportunities around data analytics.

As law departments, both in the U.S. and Europe attempt to optimize their legal service delivery models, legal operations professionals should focus on improving their strategic planning, vendor management programs, knowledge management and data analytics capabilities.

For those interested in a deeper dive into the CLOC Core Competencies, plan to attend HBR’s workshop on Tuesday, May 9 at the CLOC Institute: “Architecting Operational Excellence – Blueprints for Success.”