Prepping for Progress: Why you need a Legal Playbook

Imagine you're knee-deep in a crucial M&A due diligence assignment, grappling with tight deadlines and a mountain of legal documents. Each moment counts. Yet, your focus is repeatedly shattered by colleagues from various departments seeking on-the-spot legal advice for routine matters.

The sales guy needs you to review a contract he’s desperate to close, HR has questions about employee policy, and IT requires legal clearance for a software purchase.

But juggling the needs of your colleagues with the time-sensitive demands of your due diligence assignment is almost impossible, putting you at risk of missing a deadline or making critical errors.

What if your colleagues never had to come knocking at your office? What if there was a way to minimize that pressure? That is what a legal playbook entails.

In this guide, we have detailed everything you need to know about legal playbooks, why you need them, and tips for getting the best results from them.

What is a legal playbook?

A legal playbook is a comprehensive document detailing strategies, best practices, and procedures for handling specific legal scenarios an organization typically encounters. It serves as a reference guide for in-house counsel and other relevant stakeholders, offering a structured approach to addressing legal challenges and making decisions in various situations.

The goal of a legal playbook is to provide a structured and consistent approach to legal matters, enabling legal and non-legal teams to make informed decisions, mitigate risks, and navigate various situations more independently.

Playbooks can cover a wide range of legal scenarios, including contract management, compliance, employment law, intellectual property, and more.

Core elements of a legal playbook

The specific components of a legal playbook can vary based on the nature of the organization, its industry, and its legal needs. However, a typical legal playbook may include the following components:

#1 Regulatory affairs

This section of the legal playbook focuses on guidelines for navigating regulatory environments. It outlines compliance measures, reporting requirements, and strategies for engaging with regulatory bodies. 

#2 Contract management

Here, the playbook details the end-to-end process of creating, negotiating, and managing contracts. It includes templates for various types of agreements, guidance on risk assessment in contract negotiations, and protocols for monitoring contract performance.

#3 Data privacy and security

Given the increasing importance of data in modern business, this component addresses the legal aspects of handling, storing, and processing sensitive information. It encompasses compliance with data protection laws, internal policies for safeguarding data, and procedures for responding to data breaches.

Also read: In-House Legal Guide to Safeguarding Company Data

#4 Litigation management

In the event of legal disputes, having a clear strategy is crucial. This section provides guidance on early case assessment, alternative dispute resolution methods, and court proceedings.

It may also include guidelines for collaborating with external legal counsel, managing legal costs, and maintaining a proactive approach to litigation.

Also read: Best Practices & Strategies for In-House Counsel to Stay Informed on Civil Litigation

#5 Crisis management

Crises can take various forms, from product recalls to public relations disasters, and legal playbooks provide standard procedures for managing such situations. This involves coordination between legal, communications, and other relevant departments to ensure a unified response. 

The playbook may include protocols for conducting internal investigations, managing media relations, and addressing potential legal liabilities arising from the crisis.

#6 Record-keeping and documentation policies

Here, the legal playbook provides guidelines for document retention, storage, version control, and retrieval. It may outline the types of documents that should be retained (e.g., contracts, financial records, regulatory filings, correspondence, and more), the duration of retention, and mechanisms for ensuring compliance with legal and regulatory requirements. 

#7 Risk management strategies

“Different leaders will have different views on how to determine risk, and understanding that risk tolerance is super important to your success. If you work for a growing company, for example, your general counsel and your business leaders may be more open to taking on more calculated risks.”

~ Katayoon Tayebi, Associate General Counsel, FIGS
Accelerating Your Career as In-house Counsel

This section provides strategies for identifying, assessing, and mitigating legal risks. It may include frameworks for risk assessment, tolerance thresholds, and mitigation, as well as guidelines for communicating risk within the organization.

It addresses both legal and business risks, considering factors such as industry trends, market conditions, and regulatory changes.

Also read: Legal Risk Management—From the Playbook of 11 GCs & Leaders

#8 Communication protocols

This section outlines protocols for communicating with various stakeholders, including employees, clients, regulatory bodies, and the media. It may cover confidentiality requirements, guidelines for responding to legal inquiries, and procedures for coordinating communication between legal and non-legal teams.

Are legal playbooks right for your organization?

Legal playbooks are widely recognized as incredibly beneficial for legal and non-legal teams. Yet, only a relatively small percentage of organizations use them.

If you've yet to incorporate a legal playbook into your operations, this section explains why you should do so as soon as possible. Below, we’ve discussed various scenarios where a playbook is a must-have.

#1 Your company is onboarding contracts at scale

Your company is rapidly growing, and with expansion comes a surge in contracts. Managing numerous contracts simultaneously can lead to confusion, delays, and potential legal oversights. 

A legal playbook can streamline the contract management process, providing a standardized approach to reviewing, negotiating, and finalizing contracts. This ensures consistency, reduces the risk of errors, and expedites the contract lifecycle.

‍Also read: The Ultimate Guide to Contract Playbooks

#2 Your organization’s legal workflows involve multiple departments

If your organization's legal processes require collaboration across various departments, a legal playbook is indispensable. 

Whether you’re drafting employment contracts with Human Resources (HR), analyzing obligations with sales teams, or working on an M&A deal with all hands on deck, coordinating efforts without a standardized approach can result in miscommunication, inefficiencies, and increased risk of legal errors.

A legal playbook serves as a unified guide for all departments involved, ensuring that everyone follows a consistent and cohesive workflow. This not only enhances communication and cooperation but also mitigates the potential for misunderstandings or conflicting actions.

#3 There are constant regulatory updates in your industry

Staying abreast of regulatory changes is a perpetual challenge, especially in sectors where the legal landscape evolves rapidly.

A well-structured legal playbook includes mechanisms to monitor and incorporate regulatory updates efficiently. It ensures that legal teams are aware of the latest changes, facilitates timely adjustments to internal processes, and helps maintain a proactive stance toward compliance.

This not only mitigates risks but also positions your organization as agile and well-prepared in the face of regulatory shifts.

#4 Your team is often called up for due diligence

Organizations frequently engaged in mergers, acquisitions, or partnerships demand high precision and thoroughness in due diligence processes.

Due diligence involves meticulous examination and analysis, often under tight timelines. Without a standardized approach, this can lead to oversight, inefficiencies, and increased exposure to legal risks.

A legal playbook delineates the necessary steps, documentation requirements, and evaluation criteria. This not only expedites the due diligence process but also enhances the reliability of the results, contributing to informed decision-making.

Additionally, having a legal playbook showcases your team's expertise and responsiveness in high-stakes situations.

#5 Non-legal teams often come to your desk for assistance

Having colleagues from other departments like sales, finance, and procurement come to your desk every day can be pretty distracting, especially when you're busy with important tasks.

But this is the reality in the modern business landscape, where legal teams are becoming increasingly important in day-to-day business operations.

In such situations, having a playbook will simplify your support process. The playbook serves as a self-help resource, offering step-by-step guidance on common legal queries and issues. 

This not only empowers non-legal teams to address routine legal matters independently but also reduces the burden on the legal department. It fosters a culture of self-sufficiency while ensuring that legal expertise is readily accessible when needed for more complex issues.

“If your sales team understands the contract and the company’s positions on various material clauses, you can save yourself a lot of headaches because you can start to turn them into advocates for the contract vs. advocates for what the customer wants.”

~ Sterling Miller, CEO and Senior Counsel for Hilgers Graben PLLC
Ten Things: Creating A Good Contract Playbook

How to create a legal playbook

A legal playbook can be simple and tailored to a specific function (for instance, a contract playbook), or it can be a collection of guidelines, best practices, templates, and case studies to guide legal and non-legal teams through various scenarios.

If you’re more interested in learning about contract playbooks specifically, this guide will help.

This section details the basic steps for creating a broader legal playbook. Let’s get into it.

#1 Define objectives

Clearly articulate the goals of the legal playbook. Are you aiming to reduce processing times, minimize errors, enhance collaboration, or ensure regulatory compliance? Establishing clear objectives will guide the development process.

#2 Take inventory of processes

Create a comprehensive list of all legal processes handled by your team. This may include contract drafting and review, due diligence procedures, compliance checks, litigation management, and other tasks specific to your organization.

#3 Map your processes

Visualize each process using flowcharts or diagrams. Include decision points, key stakeholders, and inputs/outputs at each stage. This will provide a clear understanding of the entire workflow, facilitating easier identification of bottlenecks or areas for improvement.

#4 Incorporate Standard Operating Procedures (SOPs)

Develop detailed SOPs for each process. Include step-by-step instructions, responsible parties, and typical timelines for completion. If applicable, provide examples or case studies to illustrate how to navigate common challenges.

#5 Include templates and forms

Provide standardized templates for legal documents and forms. Include guidelines on how to fill them out and ensure they comply with legal and organizational standards. Ensure that these templates are easily accessible and frequently updated to reflect changes in laws or internal policies.

#6 Provide collaboration guidelines

Clearly outline expectations for collaboration between legal and non-legal teams. Specify communication channels, reporting structures, and methods for sharing information. Establish a protocol for resolving disputes or disagreements that may arise during collaborative efforts.

#7 Form a checklist for each process

Develop checklists for each process to ensure that all necessary steps are taken. These checklists can serve as quick reference guides for team members, helping them stay organized and thorough in their work.

#8 Address compliance

Outline specific compliance requirements for each process. This may involve legal regulations, industry standards, or internal policies that must be adhered to. Include regular updates to ensure ongoing compliance.

#9 Monitor and adjust

Establish key performance indicators (KPIs) to measure the effectiveness of the playbook. Track metrics such as processing times, error rates, and team satisfaction to gauge the impact on productivity and efficiency. 

Regularly review these metrics and adjust as needed.

Creating the perfect legal playbook: best tips to consider

Creating an impactful legal playbook is not a sprint; it is a marathon with a lot of strategic planning, meticulous attention to detail, and continuous adaptation.

Here, we’ve covered some of the most important considerations you must keep in mind.

#1 Prioritize flexibility and adaptability

Understand that legal landscapes and organizational needs can change. Design the playbook with flexibility in mind, allowing for updates and revisions as necessary. Include mechanisms for continuous improvement and feedback. 

A legal playbook that can adapt to evolving legal requirements and internal processes will remain relevant and effective over the long term, while a rigid one may become quickly outdated.

#2 Don’t do it alone

Involving relevant departments, such as compliance, finance, and operations, ensures that the playbook reflects the diverse perspectives and needs of the entire organization.

This collaborative approach fosters a sense of ownership among stakeholders, increasing the likelihood of successful implementation and adherence to the playbook's guidelines.

#3 Focus on clarity and simplicity

‍“Even though you’re from legal, you can't speak legal jargon. Translate your legal opinion to an easy-to-understand business rationale. And for this, legal counsel needs to learn relevant business terms and KPIs. Translate into their terms, not just yours.”

~ Ryan Nier, General Counsel at Pinwheel
Putting Legal on the Map in a Hypergrowth Startup 

Legal playbooks are most effective when they are clear and easily understandable. Use plain language and avoid unnecessary legal jargon to ensure that all stakeholders, regardless of their legal expertise, can interpret and follow the guidelines.

Use visual aids, such as flowcharts and checklists, to simplify complex processes. Furthermore, consider incorporating interactive elements like hyperlinks and bookmarks to facilitate quick access to relevant sections.

#4 Tailor the playbook to suit existing needs

Every organization is unique, with its own set of challenges, goals, and operating procedures. A one-size-fits-all approach may not be suitable when creating a legal playbook.

Thus, it is important to conduct a thorough assessment of legal scenarios and pain points teams within your organization typically encounter before creating a playbook. That way, you will provide a tool that provides maximum value.

#5 Incorporate technology where possible

"I think we're getting to this point in the legal tech evolution where legal tech is no longer a weird little area where people hold their noses and use whatever's out there. But rather, it's actually offering strategic tools that are not just value generators for the legal department, but are also becoming product differentiators and a competitive advantage for companies."

~ With Doug Luftman, ex-DGC, DocuSign
The Key to Success as an In-House Legal Counsel & Leader

If you want to improve the effectiveness of your legal playbook significantly, then you must pair it up with legal tech solutions. These may include document automation, contract management, compliance tracking, and contract review tools, among others.

With a focus on contract management, SpotDraft offers an ecosystem of solutions that streamline various aspects of the contracting process.

For instance, VerifAI (one of our newest launches) uses generative AI to accelerate contract review processes.

Trained with prompts and pre-vetted playbooks from industry-leading legal practitioners, the tool can quickly scan your contract document to highlight areas of concern, suggest amendments, and even provide explanations as to why such areas may pose risks for your organization.

Thanks to its advanced Natural Language Processing (NLP) algorithms, VerifAI is capable of taking on open-ended questions related to your contracts and providing comprehensive answers to aid your research.

Furthermore, the AI tool allows you to plug custom contract playbooks into its system alonsgide its native collection. That way, you get high-quality outputs tailored just for your contracts all the time.

Ultimately, legal tech solutions not only improve the overall effectiveness of your legal playbook but also contribute to a more agile and responsive legal department.

Hello to structure. Bye to chaos!

The benefits of having a proper legal playbook cannot be overemphasized. As an in-house counsel working in a modern business environment, you must make time to create a standardized approach for all things legal.

You can start with a playbook for one process, like contract management, and then gradually broaden your scope to cover other areas as you gain more insight and experience.

By implementing a well-crafted playbook, you're not just doing "business as usual." Instead, you're paving the way for a more resilient, efficient, adaptable, and legally compliant organization.

Want to get a better view of how VerifAI can optimize your legal review workflow for better results? Click here to request a free trial, and we'll get in touch!