Setting up an in-house legal team is one of the most sensitive tasks for a business. Not only does it set the legal precedent to guide business operations, but it also determines the organization’s ability to grow, develop meaningful partnerships, or even expand into different demographics.
Given the multiple factors that need to be considered it is not unusual for businesses to misappropriate their needs - resulting in little return on investment and added complications thereafter. To make things simpler, we put together a few questions every business unit must ask itself before opting into a legal service.
1. What are your Expectations from your in-house legal counsel?
This is probably the most difficult question and a time-consuming one to answer. But once this part is done, hiring for your legal needs would become fairly easy. There are two categories of goals that your legal function will be handling through their time with you:
- Transactional
- Strategic
Transactional goals, as the name suggests, are centered around tasks that live and die by the day. These tasks are high volume and repetitive in nature. So transactional goals involve putting systems in place that can streamline such legal tasks that are probably done on a case-to-case basis.
Some examples are, setting up:
- Contract templates for various teams such as standard sales contracts, vendor approval contracts, etc.
- Processes for dispute resolution
- The roadmap for contract creation, approval, management, etc.
- Processes for negotiation
Once this is done, the goal becomes to continue fine-tuning and improvising the systems as the company grows.
Strategic goals on the other hand are long-term, complex, and usually break down into their individual tasks. They are tied to the organization’s goals and play an important role in the company’s growth and stability. Some examples for strategic goals include:
- Raising capital
- International expansion
- Employee payroll, auditing, etc for different branches of the company
- Processes for crisis management
So a good place to start would be to put down all your wants/needs from a legal team, using the system above to both classify and expand upon it.
2. What kind of legal professional do I need to fulfill my objectives?
Now you have your list ready. Before you get into hiring, there is a step in between: taking stock of your business. The type of legal professional you will be needing is directly related to the nature of your business and industry. Let me illustrate this with an example.
Say you are the CEO of Acme Corp, a manufacturing company for various metal spare parts, registered in the USA. Acme Corp plans to open manufacturing units in 3 different countries within the next 5 years. Just on a superficial level, you will need legal experts for the following:
- Incorporation of company, following compliance with various jurisdictions
- Payroll structure based on geographical location
- Intellectual property assignments
- Trademark
- Labour laws in said countries
Simultaneously, here are some other tasks that will also require legal’s help:
- Help negotiate on contracts with various vendors
- Coordinate between business teams towards things mentioned above
- Streamline requests for the legal team, manage and coordinate for projects
Acme Corp can hire 2 types of legal professionals:
- Experts who come with deep domain knowledge such as incorporation, IP, labor laws, etc
- A generalist with a base in law who can coordinate between various teams and manage legal projects
Law firms and independent consultants are recommended for 1 while your in-house counsel would be ideal for 2. Another concept increasingly gaining cadence is that of - Alternate Legal Service Providers (ALSPs). These are niche companies that specialize in micro-tasks like - daily litigation support, legal discovery, and legal research. They come at a fraction of the cost of a dedicated law firm but do not carry the same expertise as the latter.
3. What tertiary skills are crucial for a potential in-house legal professional?
In corporate environments, bracketed legal skills aren’t sufficient to drive organizational objectives. Even roughly in-house legal professionals are expected to the following bevy of tasks-
It is important, therefore, that any potential legal hire has associated talents that help them tie their KRAs back to your larger organizational goals.
Not only are corporate lawyers required to ensure the organizations meet regulatory standards, but they are also expected to ensure compliance with financial and data-processing benchmarks. This means that any lawyer, depending on your specific industry, needs to have business management or financial acumen.
Another need of the hour is exhaustive industry knowledge. As an in-house counsel within a specific industry, one is expected to be able to proactively contribute to business decisions. Shallow knowledge of the industry would mean that your in-house legal hire is underprepared to identify future possibilities, handle big-ticket strategic issues, or provide active counsel on the long-term implications on your bottom line.
4. How do I ensure seamless work between legal and business teams?
Business success relies heavily on the ideas of transparency and coordination. For a legal hire to actively contribute to your business they must be recognized and empowered to communicate seamlessly with other members of the organization.
Here are the steps that can help get them started on the right footing:
Inventorize and templatize
Ensure all your legacy contracts and business-related documents including but not limited to - operating agreements, employment agreements, business reports and plans, leases (if applicable) are tracked and unified into a repository to serve as the legal base.
This is as crucial for the business as it is for the legal hire, lost contracts can directly lead to real monetary losses. It is also great to have all information related to reference in case of any crisis or new project.
It is also extremely important to templatize standard contracts so your first in-house lawyer isn’t stuck in continually drafting everyday agreements and can instead focus on helping your business do more.
Here’s a curated contract management template to help you get started.
Maintain an open-door policy
To eradicate silos, it is important to keep your in-house legal professional involved in matters beyond legal management. Encourage them to communicate with the peer teams, give them a seat at the table at strategic, sales, or marketing decisions and leverage their diverse skill-sets to work faster.
For example - utilize your legal professional’s crisis management skills to supplement your marketing team’s efforts during crisis communications.
Conversely, enable your non-legal teams to reach out to your corporate lawyer to seek counsel. Since your lawyer is always on top of all your agreements or documents, they can assist your business with mission-critical insights.
Communicate what the legal department does clearly
Clearly publicizing your legal department’s work can not only help bring in accountability but can also make your business teams more aware of when they can seek advice. This makes workflows faster and more efficient.
Communicating legal department KPIs or tasks can also help prioritize work and set realistic expectations on returns.
5. How do I maximize output for my hire/team?
In a previous interview with SpotDraft - Brian Dunn, Head of Legal and Compliance, Unifonic Inc asserted the importance of judicious legal spending. He argued against “throwing bodies at the problem,” especially when your tasks can instead be automated.
Using technology and automation for legal’s transactional goals will improve output, efficiency, and quality, all the while allowing you to maintain a lean team. There is an increasing shift among top GCs globally where legal tech is brought in far earlier during the legal team’s growth, rather than later.
Some legal tech systems that have caught on rapidly in the last few years include
- Contract management and automation
- eDiscovery, legal research
- Document storage and discovery
The more repetitive tasks you can take off your GC’s plate, they will be free to assist you with actual counsel.
Lastly, if I have to leave with one general piece of advice for hiring legal counsels: they are advisors. Lawyers who are genuinely interested in the business and educate themselves about the industries they operate in are the ones primed to succeed as GCs.
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