A closer look at my work at UnitedLex.

Editor’s note:  For this month’s column, I encouraged Anusia to write about her work at UnitedLex, as it’s a complex topic of great value to the LE audience. See Post 020 (discussing the critical role of change agents in helping social systems successfully adopt innovation); Post 034 (discussing work of modern legal industry change agents).  Further, first-person narrative accounts—i.e., personal stories—are the best way to communicate the complexities of an industry in transition.  Indeed, commercial vulnerability, which is on display here, is very effective for education. wdh.

Upon my return from an energizing solutioning session with a prospective client, a family member and former 30+ year in-house attorney at a $30B+ annual revenue financial services organization based in New York, turned her gaze up to me and glibly asked, “So, did you sign them up?”

Knowing that she is quite jaded about anything new in #LawLand, I declined the opportunity to explain that signing people up is not what I do and, instead, offered a thin smile, “Not yet.”

In casual conversations with in-house friends (when guards are down and “not knowing” is OK), I often encounter a similar type of confusion, albeit with sincere curiosity in their questioning: What does UnitedLex do?  Could you give me the spiel?

This month’s column clears the confusion. We don’t sign people up. Here’s the spiel, intended only for the curious.

Q: What is UnitedLex and how does it create value for legal departments?

UnitedLex is a global law company that strengthens legal departments by harmonizing legal and business data. This article offers transparency around the mechanics of how that unfolds and why, until now, it’s been so uncommon.

We focus on data because data fuels the commercial world and opens the door to creative problem-solving. Imagine a Chief Financial Officer who didn’t have timely financial data to inform and evidence their decision-making. Or a Chief Marketing Officer who, especially with today’s access to social, web, and other digital analytics, was unable to provide insights on the most-clicked products across various channels and how that drove Q2 revenues.  I hope that you can’t imagine either scenario.

Legal is lagging in this area. The opportunity and challenge for General Counsel is to create a legal department model that moves at the speed of business and reports on the value delivered through a range of “outcomes.” These outcomes include measurable performance improvement, risk mitigation, revenue gain, cost reduction, and digital business synergy (tying into the technologies and digital initiatives that exist in other departments for faster communication and new intelligence). Obviously, all of this requires high-quality and timely data.

In the legal ecosystem, UnitedLex’s capabilities tend to match up best with global public and private legal departments of companies with $3B+ in annual revenue.  These types of client partnerships often include a combination of:

  • An Amazon-like portal to centralize legal requests from sources such as Outlook, Teams, and Salesforce that entails “intelligent” routing and continuous knowledge capture;
  • Bringing together and organizing company data from multiple silos (e.g. Salesforce, SAP, eBilling);
  • Data science talent that analyzes and contextualizes insights;
  • Dashboarding technology that provides a real-time single source of truth; and
  • Deep knowledge and tech-enabled service in functional legal areas, including litigation, contracting, intellectual property, risk, compliance and investigations, and legal operations.

Data is the throughline that ties all of this together.

Q: Where does one start? Don’t you have productized services ready to go, and isn’t that signing people up?

Yes, we have modularized “Rapid Value Projects” that offer high impact places to begin a legal department’s modernization journey. We can mix and match and predict the associated value created quite effectively with our Luma application. (See, e.g., UnitedLex Launches Predictive Modeling to Forecast Legal Department Performance.)

Even then, though, we aren’t “signing anyone up.” We are identifying the practical steps that both solve acute and felt challenges and deliver measurable value. But here’s the rub: those identified steps are not all the right steps right now.

Each is situation-dependent. It gets complicated when considering implementation in legal departments of various sizes and states of maturity.  Further, every organization has its own political complexities and mandates.  In some cases, the focus is impending demand.  In other cases, it’s greater predictive capabilities that can be used for cost control.

Each client collaboration is an exercise in innovation. Peter Drucker, the founder of modern management, wrote in his seminal Harvard Business Review article, The Discipline of Innovation, in 1985: “Above all, innovation is work rather than genius.”  Drucker explains that the most successful business ideas result from a “conscious, purposeful search” and analysis of seven specific areas of opportunity. (See bottom bar for two examples and how they might apply in legal.)  These areas of opportunity represent sources for innovative solutions.

This is the playing field of the legal innovator and, for law companies like UnitedLex, a way to support the in-house leader in designing the “where do we start” foundation, the “how do we step-change” roadmap, the right CFO-grade business case, and change messaging to ensure a successful modernization effort.  As part of this process, we learn what the legal department has already tried or considered to test assumptions, iterate, or pivot and find the golden pockets of opportunity.

For example:

  • In a traditional legal department wanting to “lay the new tracks” but not disrupt the current railroad, the golden pocket might be in a special location, away from the mothership, where the pilot project can live, come into the spotlight, and proliferate or, alternatively, continue successfully in isolation.
  • In a company with significant cost pressures, speed is critical, and the golden pocket might be to dust off prior work product that failed under earlier conditions or leaders and see if the changed circumstance now makes the prior strategy viable.
  • In a spin-off company with the rare opportunity to build a robust legal department from scratch, the golden pocket might be everywhere and the challenge is to pace and prioritize artfully.

Q: What about a legal department is not yet “optimized”?

For a long time, the optimized legal department meant an environment of smart lawyers, decent budgets, and predictable work.  It was guided by what Casey Flaherty called the lawyer theory of value:

The key to value is having smart lawyers.  Lawyer time is the primary resource and the primary unit of measure even in law departments that have no compensable time sheets. Because in-house and law firm lawyers are the same people, they have the same go-to move — stand back and let me lawyer.

See Post 040 (quoting Flaherty).  For many years, a corporate client could improve its cost structure simply by bringing more work in-house — and even better, no one needed to change. Instead, law firm associates traded in the pressures of billable hours and business development for an in-house position that offered a better balance of money and predictability.

[click on to enlarge]
By 2016, however, the size of in-house teams had tripled.  See Post 003.  By 2020, in-house was officially bigger than BigLaw.  See Post 262 & right graphic.  Not surprisingly, over the past five years or so, the music is winding down … and has stopped for many.

As an industry, we are transitioning from a lawyer-centered to a client-centered approach.  In UnitedLex’s segment of the market, the clients are the large global organizations that legal departments serve; and they’ve all become savvy to the value potential that exists within legal departments. From $100B+ global behemoths that are thriving economically to $30B multinationals with strict financials, the mandate is shared: “Legal, you may no longer solve with additional headcount.”

Q: What’s the alternative to solving with additional headcount?

Creating a connected model that scales, which means the right blend of data, people, process, and technology across organizations (in-house, law firm, law company) implemented in the right way and at the right time.  Further, because a legal department is managing risk on behalf of its client, every part of this transition to a connected model needs to be designed and executed with precision.

A connected model needs structured data to enable easy reporting on the operations of the legal department and connections throughout the business (e.g., value creation metrics, volumes, average speed, status, activity/capacity, geographic distribution). A connected model should also produce “within the law” insights that improve decision-making (e.g. intellectual property monetization opportunities, prior negotiated contract terms, red/amber risks, areas of repeated litigation). Finally, a connected model must give the legal team the bandwidth they need to focus on topics and projects that warrant their deep expertise and experience as lawyers.

The key point here is that the solutions we are building—the connected models described above—are truly new to lawyers.  It’s going to take a full generation to work out the terminology to the satisfaction of inquiring lawyers.  Until then, I need to show patience with legal industry colleagues who are constantly trying to put us into an easily labeled box.  Hopefully, this essay will help.

Peter Drucker | Innovation Opportunity Examples

The graphic below is a summary of Drucker’s seven sources of innovation. Four sources are internal to the organization (left side). Three sources are external (right side). The occasional flash of genius (bright idea) is rare and beyond our control.  Hence, the reliance on the seven sources.

Source: Open University

Incongruities.  An incongruity between an industry’s assumptions and its realities can open possibilities for innovation.  For the first 50 years of the 1900s, shipbuilders and companies made ships faster and lowered their fuel consumption, but the economics of ocean freighters continued to plummet, almost to an early death.  The ships were not the problem, however.  The real costs did not come from being at sea, but from sitting idle in port.  This realization led to an obvious innovation: the roll-on and roll-off ship and the container ship.  These solutions, which involved old technology, simply applied to ocean freighters what railroads and truckers had been using for 30 years.  A shift in viewpoint, not in technology, completely changed the economics of ocean shipping and turned it into a major growth industry.

How does this apply in legal?  What assumptions are you operating on in your initiatives?  Do they align with reality?  If you are putting a lot of effort in and not getting the results you expect, there is likely an opportunity to work differently.

Process needs.  Japan’s roads follow cart paths from the 10th century.  The process of driving on these roads requires the driver to be able to see in many directions.  What makes the system work is one small yet significant innovation: an adaptation of the reflector used on American highways since the early 1930s.

How does this apply in legal?  Consider the infrastructure for your work.  Are there areas where traditional wisdom would guide you to “blow the whole thing up” and create a modern highway system?  Or, is there something out there that you can adapt to make your current infrastructure work better?