Every company wants efficiency. Being a top corporation requires efficiency and hard work and that's exactly what legal operation provides. Legal departments are supposed to provide just this to make sure that all the work is done smoothly. Take the example of Silicon Valley that took the help of legal operations to get to where they are today and not only catch up to their rivals but also beat them.
Legal operations refer to the operations necessary for a functional legal department. These operations ensure that legal departments can provide more effective legal services.
What are legal operations?
Legal operations are the essence of every corporation. The legal industry is evolving with increased demand for legal services that continue to be trending in any form of business. It is responsible for producing efficient plans for in-house legal teams and enhances their work proficiency with better decision strategies. The set of activities are much broader comprising intra- and inter-functional collaboration, innovative legal solutions to the clients, managing financial matters, technology, vendor management, data analysis to maximize the effective delivery of legal services. CLOC's model is based on twelve core competencies that are divided into 3 layers, specifically foundational, advanced, and mature level competencies. In other words, legal operations have turned down the concept of in-house legal from "cost center" to "value-creator".
In recent times, legal operations have morphed into a rather flexible aspect of most functional organizations driven by the need to provide business returns. Initially, in-house legal teams were tasked with mostly esoteric legal duties which could be executed by outsourcing.
Legal Departments are becoming more sophisticated in terms of the need to align with any company's strategies in certain areas. Increasing efficiency, training the legal team properly, adapting to the new times, selecting responsible suppliers are some of the keys that encompass legal operations.
Property technology, better known as Proptech, has become one of the major topics that are discussed in the real estate market with billions of dollars invested towards innovating and enhancing it.
In fact, the first two quarters of 2019 witnessed record-breaking investments of $12.9 billion streamed into proptech advancements.
Meet Jessica. She leads the legal team at a popular real estate firm. Her team is hardworking and dedicated - but she’s noted their performance has been faltering as of late. With heavier workloads, the team clearly wasn’t working as efficiently as they could be.
Each day they’d spend hours drafting complex contracts by hand, tediously copying and pasting clauses and explaining contracts to different parties. There were communication breakdowns due to poor collaboration between colleagues - and even some contract errors. For Jessica, it was evident: the legal team was placing all their energy into drafting legal documents, instead of supporting the real estate firm to really thrive.
Efficiently managing the "contract life cycle" can be a headache for many corporations. That is it is important to have a contract lifecycle management strategy in place.
Signing contracts to regulate the relationships that arise with suppliers and / or customers is something daily in many companies.
These documents that we call "contracts" are nothing more than putting the parties' wishes in writing and are mostly fulfilled, but some of them may be breached, or at least part of the terms and conditions established by them.
When that happens, the "contractual risk" that we will define below materializes and involves going to court to compensate the damages that have been caused.