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Clifford Chance

Clifford Chance
Active Legal: Value Pathways<br />

Active Legal: Value Pathways

How in-house legal teams measure, monitor and communicate value

How in-house legal teams measure, monitor and communicate value.

In today's global business landscape, the significance of in-house legal teams has never been more pronounced. Heightened visibility brings greater responsibility to showcase value, by using metrics that are familiar to other corporate functions and the board.

While the assessment and communication of value are longstanding challenges for strategic advisory roles, the unique dynamics of the legal function present equally unique complexities. So Clifford Chance and RSGI have collaborated with General Counsel and heads of legal operations from 15 organisations spanning various jurisdictions to produce this report. Our aim is to establish the common ground in how Legal quantifies value and, by sharing these insights, inform discourse on the best way for in-house teams to measure value in the future.

As with the other reports in the Active Legal series, this report is based on academic and market research alongside long-form interviews. The report identifies four core value pathways – Economic Value, Efficiency, Quality and Influence – together with examples of what can be measured and how.

Our hope is that legal leaders will use this report to affirm and develop their approach to measuring and demonstrating value, and to create a higher profile and an even more strategic role for the legal team in their organisations. We hope these insights generate further discussion and invite you to the conversation.

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Economic value

In-house legal teams have historically reported to the business on activities core to the legal function – budgets, spend and litigation management. However, the legal function is becoming more sophisticated in how it records its contribution to business growth. External customer perception is becoming an important measure of value.

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When assessing the efficiency of their departments, General Counsel will look at the productivity of the team and which legal work is optimised. They will look at people, processes and technology, the three pillars of digital transformation. Some of the participants in this study are also measuring responsiveness, the adoption of smarter workflow technology and approaches such as agile working, as measures of their efficiency.

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What sets high-quality legal teams apart is their ability to align with business objectives and deliver a strategic experience that goes beyond traditional legal tasks while ensuring smooth execution in line with the tolerance of the business for risk. The key themes in 'Quality' are KPIs that are aligned with the business, service level agreements and benchmarking to demonstrate where expectations are exceeded.

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The influence of legal teams within organisations has been growing alongside expanding functional mandates. This is a relatively new measure of value and is a challenge to quantify but some legal teams are successfully measuring their level of influence in the business by looking at levels of awareness and engagement as well as the use of tools and resources.

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The Active Legal: Value Pathways report aims to close the gap between theory and practicality by providing inspiration and pragmatic guidance to guide leaders of legal teams in defining a strategy for measuring value that makes sense for their business. Download the report to find out more about the four pathways that constitute the value delivered by a legal department: Economic Value, Efficiency, Quality and Influence.

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Partner Ashley Prebble says...

"The Active Legal: Value Pathways report demonstrates that in-house teams are taking a structured approach to collecting, monitoring and sharing data, success stories and qualitative wins to highlight the role they play in advancing the strategy of the business.  As private practice lawyers, we can learn a great deal from the report, including what it is like to 'walk in our clients' shoes' and what they need from us to be the most valuable business partner"

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RSGI Limited is a global legal think-tank, specialising in research into how the legal industry can grow sustainably, and stay relevant and innovative. With a track record of many of the leading thought-leadership studies in the sector, including being the founder and content partner to the FT Innovative Lawyers Programme, RSGI is committed to driving positive change in the industry.

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