For any business to operate efficiently and be successful, one of its most critical functions is its Corporate Legal team. Yet, in the vast majority of organizations, the Legal team is seen as an ancillary and supporting function whose role is to aid critical “line” functions such as revenue, finance, and product.
Even a cursory look at the world’s most successful companies will reveal a completely different picture—and that is one of their Corporate Legal and General Counsel’s offices playing a central, strategic, and primary stakeholder role in their success.
Demands of the Legal Department and the General Counsel (GC) have transformed significantly in recent years, with a massive emphasis on structuring contracts based on strategic business decisions. Operational efficiency and real-time data and information are of paramount importance. Of crucial importance is the ability to manage and mitigate enterprise risk that the business is exposed to via contracts, agreements and negotiated settlements. In addition to overseeing legal matters, compliance, and contracts, CEOs are demanding that Legal teams have complete control and a real-time look into rights, obligations and liabilities that the company has.
Modern technology tools, such as Intelligent AI-driven contract management, are essential for accomplishing the goals and objectives of today’s General Counsel.
This guide provides a comprehensive overview of legal department operations, offering insights into best practices, strategies, and tools essential for creating a highly functional legal department in today’s business world.
ONE: Expand the charter
The corporate legal team, led by the General Counsel, must work with executive management to expand the scope of Legal’s responsibilities beyond traditional legal functions.
An important mandate for Corporate Legal must be that all contracts and contract templates across all business functions must be designed, created, and owned by Legal. In situations where business units have specific or specialized requirements such as with product IP, specific procurement or pricing needs, etc., Legal must still make it clear that such contracts are developed jointly by the business unit and their business partners in the Legal department, and that Legal owns final signoff of all contracts and agreement templates.
Some of the key business units that Legal must have such oversight and final contract ownership of, include:
- All sales, customer, partner, and alliance agreements
- Any procurement or vendor-purchasing contracts
- All governmental, regulatory or compliance-related contracts
- Contracts and letters related to all employment and hiring
- Every external party contract and agreement, such as NDAs
- Any Intellectual property or product-related requirements
- All negotiated settlements
- Any agreements, discussions, or contracts that tie the company to any type of financial exposure or potential liability
TWO: Build your Legal Operations around a vital and indispensable technology stack
Today’s Legal teams depend heavily on a vast array of technology tools to enable them to function strategically and efficiently at peak levels.
At the core of all legal tech lies Intelligent Contract Lifecycle Management. Every Dollar that comes in or goes out of the business is controlled and governed by a contract. An effective CLM system must be intelligent to accommodate a vast scope of contract volume, template types, and clause libraries. These systems should be able to digitize all contracts, including past hard-copy legacy contracts and be able to read key data and information instantaneously. An essential and vital requirement of your CLM system is its ability to search and report critical information across a wide and deep volume of contracts.
THREE: Become an integral business partner
Legal must have a “seat at the table” for all business discussions across all of the functions listed above. This is particularly important when strategizing, defining, creating business processes and consequent contracts and agreements. This partnership enables Legal to understand the nuances and needs of the business functions, while also providing the business function valuable and critical insights into legal issues, angles and considerations that are far too often missed or unknown by the business teams.
FOUR: Provide continuous visibility and feedback to the business
This partnership between Legal and business teams is a continual cycle that keeps getting tighter, smoother, and more efficient with time. A critical deliverable for the Legal teams is to add value to the business teams by providing regular, frequent and real-time visibility into the exposures, potential issues, and important considerations that the business teams see in their contract and agreements.
Rahul Asthana has a PhD in Operations Management from the Anderson School at UCLA. He has 25 years of experience in supply chain management, starting his career in IBM working in supply chain operations. He then moved into product management and product marketing of supply chain software while at SAP and Oracle. He manages product strategy and product management at Gainfront. In terms of hobbies outside of work, he really enjoys tennis. Follow Rahul Asthana on Linkedin!