Sociology concepts and law department management

Sociology, the study of how humans live together, has developed a number of concepts that shed light on how law departments operate. As when I collected my posts that apply the concepts of economists to law departments (See my post of March 26, 2006 and its links.), it is high Durkheim if Weber it was time to ring the Bell and Talcott a bit on posts that pertain to sociology.

Alienation (See my posts of June 28, 2005 on disengagement levels among general counsel; April 3, 2005 on the engagement index of Stanton Marris; and Nov. 19, 2005 on the difference between engagement and satisfaction.).

Conflict (See my post of Oct. 10, 2005 on competition among successors; and Aug. 5, 2005 on competition over who should manage business-unit litigation.).

Culture (See my posts in 2005 of May 4, Nov. 16, and Dec. 21, 2005 on that term as it applies to law departments.).

Empowerment (See my post of April 13, 2006 regarding Disney and client empowerment.).

Hierarchy (See my posts of Nov. 8, 2005 and March 23, 2006 regarding titles.).

Power (See my post of April 26, 2006 on this term in connection with retaining outside counsel.).

Tribes and teams (See my posts of Feb. 7, 2005 on the group development questionnaire with other links; April 26, 2006 on internal labor market analyses; and May 1, 2005 on employee morale.).

Some of the best-known concepts and concerns of sociology do not appear to have direct reference to law departments: religion, family, rites and superstitions, and sexual practices.

Requests for information (RFI)

Earlier I criticized requests for proposals (See my post of July 18, 2006.), without making mention of the older sibling, requests for information (RFI). An RFI precedes an RFP and typically confirms basic information about a herd of vendors and their offerings. Law departments that have a large group of vendors to slog through use the RFI responses to sift them to a more manageable number.

My feeling is that an RFI accomplishes little, but takes time, costs money, and justifies more meetings. Other than that, they keep paralegals busy and produce nifty tables.

Cottage industry: vendors (other than law firms) that conduct business with law departments

After once-over lightlies about the swarm of vendors other than law firms who supply goods and services to law departments as part of a multi-billion dollar ecosystem – a classic cottage industry, it seems it will help readers if I collect information on those niche markets (See my posts of April 18, 2005; Oct. 18, 2005 on the revenue that might go to companies that are part of the cottage industry; and May 30, 2006.).

Accordingly, a number of subsequent posts have noted various clusters of suppliers to law departments (See my posts in 2006 of Feb. 9 – document discovery vendors; July 4–litigation and trial consultants; July 5 – corporate governance groups; July 5 – online legal and compliance training; July 6 – legal search firms; July 11 – e-billing vendors; July 11 – court reporters; July 14 – matter management systems; July 14 – class action claims firms; and July 19 – corporate secretary web portals.).

“It’s more disruptive to replace a firm than to live with poor service” (InsideCounsel)

Rob Vosper, Executive Editor of InsideCounsel, writes in the July 2006 issue, at page 10, that in-house counsel pay law firms’ bills, but the “firms run the show.” As incredibly, he then asserts that “firms know that most in-house lawyers believe it’s more disruptive to replace a firm than to live with poor service.”

Rob, with all due respect, I disagree completely, for three reasons: law firm unease over client loyalty, law department’s axes, and overstated transitional costs.

Law firm partners worry about their hold on clients and do not take for granted that the manna will fall forever. With convergence, turnover of general counsel, cost control mandates, conflicts of interest, virulent marketing by competitors, in-house evaluation systems, and changes in clients’ businesses, uneasy lie the heads.

That law departments cut law firms off is undeniable, if only by not giving new matters to firms that fall behind. The institutional hold of firms is thin soil on a windy hill: always at risk of being blown away.

And, finally, familiarity does root incumbent firms but they can and are deracinated when their service drops to poor, since another firm will gladly implant itself and even absorb some ramp up costs (See my post of Aug. 14, 2005 on litigation transaction costs.). It seems to me, in fact, that in specialty areas of law the hold is least secure.

Software for communication with members of the Board of Directors

It is a hassle for a corporate secretary’s staff to photocopy and assemble hefty board books for Board meetings and then distribute them to members of the Board. The chore is aggravating, prone to error, under deadlines, and low-level.

Several software packages streamline this chore by allowing a law department to post the materials on a secure online site (See my post of Jan. 24, 2006 for other corporate-secretary software.). Directors can download the documents they need and print them out. This capability not only alleviates the logistical nightmare of manual distribution but also allows the department more time to prepare the materials. The software also serves as a repository for directors so that they can look back and find earlier material easily. Software for these purposes, such as Endexx, Aprio, and BoardVantage, also has other functions such as expense tracking, calendaring and voting.

27 metrics and benchmarks for patent departments

An excellent publication by Michael Kaminski, a partner at Foley & Lardner, describes 27 possible metrics and measurements that a company can choose from to describe its patent activities.

Kaminski breaks the metrics into eight groups, which he describes as “generally in order from most common or simple to increasingly esoteric” (at 10). These are the groups, with the number of metrics in it stated in the parenthesis: a charter (1), a “standard” set (4), a “product-centric” set (9), a “money saved” set (2), a “licensing” set (3), a metric to quantify risk avoidance (1), a “patent citation” set (3), and an “accounting information” set (4).

Has anyone written on the history of law departments? Early references to law

I would welcome hearing from readers about law departments formed years ago. Here are two examples. According to his obituary, NY Times, June 22, 2006, Arthur Wood joined Sears in 1946. The first task for the graduate of Harvard Law School in 1937, who had spent about four years at the law firm of Bell, Boyd & Marshall in Chicago was to set up the Sears’ legal department. Thus, the law department was formed in 1946-7. My post of Aug. 27, 2005 on Edith Spivack noted her remarkable stint of 70 years with the New York City Law Department, where she was hired in 1934 as assistant corporation counsel. Even then that department was long in the years, judging from John Greener, History of the Office of the Corporate Counsel of the City of New York (M. B. Brown 1907).

Cost control idea? Approvals to hire outside counsel

This technique does not sound promising to me but it might be worth considering under certain circumstances. If inside lawyers always had to obtain a written sign-off of their superior before they retained outside counsel, it would certainly make them think a bit more before triggering the cost.

My reaction to this idea is that it is belittling to the person who wants to hire outside counsel. If they do not have the judgment of when they should seek approval and when proceed on their own, the problem is more serious than outside counsel cost control.

The storms outside that buffet law departments

Political, social and economic forces gradually but powerfully transform departments. Unlike the decisions of a general counsel or CEO, however, these three tectonic plates shift without being recognized in law departments’ strategic thinking. Here is a glimpse of how the three forces might have effect.

Political. A new administration alters regulations, judicial appointments, and legislative priorities (See my posts of May 15, 2005 generally about legal complexity; as well as on the same topic in more specific applications: June 28, 2005 and Aug. 27, 2005 regarding litigation; Dec. 14, 2005 regarding utilities, and Feb. 16, 2006 regarding tax.). Work and priorities change, and a law department may have to embrace more closely what is generally referred to as government affairs.

Social. Demographic changes mean that generations of workers have different values and differences (See my post of June 13, 2006 on Meyers-Briggs extroversion scores rising.). There are more women graduates from law school and more women in law departments, not to mention more diversity (See my posts of Sept. 4, 2005; Dec. 4, 2005; and July 18, 2006 on diversity.), older lawyers (See my post of March 16, 2006 on long-in-the-tooth veterans and knowledge loss.), more working spouses, and more resistance to overseas assignments (See my post of April 27, 2005 about Eastman Kodak; and Oct. 10, 2005 on ex pat costs.).

Economic. Competition influences workload, types of work and department structure (See my post of April 13, 2006 about Philips and antitrust training.). The spread of business around the globe means outposts of overseas lawyers and more international law (See my post of April 19, 2005 that wonders whether globalization’s effects have been exaggerated.). Technology’s spread means more intellectual property concerns (See my post of Jan. 16, 2006 on Ocean Tomo.), and the opportunity for law departments to make better use of software.

Obviously, treatment of the external forces swirling around law departments is ill-suited for a brief post. The take away from this snippet is that large forces profoundly affect how law departments are and should be managed.

RFP – RIP

Along with the requirements definition phase (See my post of July 15, 2006.), the traditional next step of IT staff and consultants when they choose software is to extrude a request for proposal. The RFP outlines the presumed requirements of the department for the software. It is more detailed than a request for information (RFI).

Unorthodox I may be, but my view is that RFPs consume far more time and cost and effort than they return in insights. Their pages of questions put vendors through agonies and then spill out in an enormous matrix that makes it difficult to narrow down the list of candidates.

A better procedure is to pick a handful of crucial aspects of the system and, after having seen initial demos, ask the vendors to respond in just those few areas and with thoughtful, complete responses. You can do this process two or three times as you narrow down what is important, set priorities and scale those attributes, and come to realize what few important factors differentiate the contenders.