Law department “business managers” lower legal costs and increase productivity 10-15 percent

These conclusions come from a survey conducted in 2004 by the General Counsel Roundtable, as summarized in Corp. Legal Times, Feb. 2005. They strike me as plausible, but hard to prove.

I cannot help but wonder whether cause and effect are being confused. Do well-run legal departments tend to have lower costs and higher productivity, and also tend to hire empowered and capable administrators? Is the cause of better performance the administrator, or is the administrator one piece of broader effectiveness?

My second question, unanswered by the brief reference in the article, would be: “How did the survey measure in-house productivity? Possibly the study compared departments on total legal staff per billion dollars of revenue, and those with lower ratios more commonly had what the study deemed to be “business managers.” (See my post of Dec. 9, 2006 on my methodological complaints about a study of ADR-favoring companies and their putative benefits.) I doubt the GCRT has discovered the elixir of how to measure law-department productivity. (See my post of March 24, 2005 on that missing metric.)

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