Three lessons on structure from PPG Industries

James Diggs, the general counsel of PPG Industries, spoke to a reporter about the recent restructuring of his 37-lawyer department, GC Mid-Atlantic, March 2006 at 24. In that retelling, we can pick out three important points about law department structure.
For the first point, Diggs explains that a new CEO combined the company’s 15 business units into five “clusters.” Diggs restructured the law department to have a “mini-GC” responsible for the legal work of each cluster. That lawyer serves as the Single Point of Contact (SPOC) for the top executives of the group which that lawyer serves. The point is, the restructuring and re-aligning of the law department followed the changes in the client group.

Secondly, Diggs abandoned the old system of “functional hierarchies,” where lawyers practiced in “siloed groups of specialty lawyers,” such as intellectual property, labor and employment, commercial, and litigation. Under the new system those specialists report to a cluster leader, dubbed “corporate counsel.” That point is, legal/functional orientations give way to business-unit oriented groups.

Before Diggs jiggered his structure, he had introduced practice groups. His practice groups “brought together lawyers from different specialty areas who routinely dealt with common subject matters.” For example, PPG’s legal department had a commercial transactions group, a patent applications group, and a licensing group. Here the structural point is that even with a functional arrangement a law department can coordinate legal work that cuts across areas.

Bear in mind that litigators – two of them – and environmental health and safety (EHS) lawyers remain in specialty clusters. And one other fact: Of the 37 lawyers, three are based in Europe; and one each in Brazil, Hong Kong, and Asia.

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