An earlier post mentions the risk to a general counsel that a specialist who supplements the department’s lawyers, in a practice support role such as knowledge manager, e-discovery supervisor, or database guru, may leave for a vendor or consultant (See my post of March 13, 2006: expert staff at risk of being poached.).

A telling example comes from Legal Tech. News, Vol. 15, May 2008 at 12, which reports that Jeff Beard, who was the Legal Services IT Manager in Caterpillar’s law department, has joined Electronic Evidence Discovery Inc., a service provider.

Compensation schemes of companies are not flexible enough to compete. Also, the job outside offers more variety, although probably at the cost of traveling much more.

The technology is cheap and easy that allows in-house lawyers to record lessons they have learned during the day. For example, PDA’s let you save your comments at any time on what you just took away from a negotiation, or from a law review article, or from a meeting with outside counsel. Voice recognition software does the trick in the office (See my posts of Feb. 23, 2008: references cited to dictation.). It is easy to cut and past good ideas (See my post of April 27, 2005: knowledge management.).

I think of experiences, insights, practice observations, and ruminations as “nuggets.” For years I compiled my own nuggets on consulting to law departments. My blog posts are nuggets.

These Individual chunks of knowledge are not as stylized as post mortems (aka after-action reviews), which are much more familiar to in-house lawyers (See my posts of Dec. 10, 2005: litigation studies at BellSouth; April 7, 2006: resolved litigation should instruct us; Nov. 6, 2006: after-action reviews; Dec. 19, 2006: test predictive accuracy of law firms; Jan. 30, 2006: ChevronTexaco’s COBALT; Jan. 3, 2008: rarity of post-mortems; and Jan. 13, 2008: learn from unsuccessful practices.).

An article in Talent Mgt., Jan. 2008 at 45, extols the importance of personality traits. "Research indicates between 20 percent and 25 percent of an individual employee’s effectiveness on the job is attributable to his or her personality.” That high degree of influence seems less likely for in-house lawyers, knowledge workers who often toil on their own with expectations of professionalism because they share values, an education, and collegial expectations.

Even aside from the characteristics of in-house attorneys, not everyone agrees that personality makes such a difference to effectiveness (See my posts of Jan. 1, 2006: IQ tests predict work performance ten times better than do personality tests; April 22, 2007: “personality is not a particularly good predictor of behavior”; and Feb. 28, 2006: emotional intelligence predicts 85% of a lawyer’s career success.).

Finally, setting aside an exceptionalist view of lawyers and disagreements over the relative contributin of personality, the term itself is protean, its definition hard to pin down (See my posts of Nov. 13, 2005: competency, IQ, personality, and emotional intelligence; Nov. 22, 2006: personality-test questions; May 14, 2006: most important personality traits for in-house counsel; Nov. 8, 2007: psychometric tests and references cited; and Jan. 1, 2006: “executive intelligence.”). If “personality” becomes the sum total of someone’s behavior, it is a tautology to say that personality influences job performance.

The Talent Management article asserts that some employers look at personality traits to select job applicants. They evaluate such characteristics as conscientiousness, agreeableness, and extroversion. “Data mining shows that these personality traits are better predictors of worker productivity (especially turnover) than more traditional ability testing.” Ian Ayres, Super-Crunchers: Why Thinking-By-Numbers is the New Way to be Smart (Bantam 2007) at 28.). The entire area of purposeful personality assessment is a wasteland for law departments.

This post has honored a number of social “laws” that have become commonplaces. One not mentioned so far is Moore’s Law, which describes in part why technology can play an important and affordable role in law department productivity. The law holds that that the number of transistors per square inch on integrated circuits will double approximately every 18 months.

Other pronouncements labeled “laws” have appeared among the posts on this blog. Goodhart’s Law pertains to the loss of information content once a metric becomes a target of a policy (See my post of May 25, 2008.). Pareto’s Law describes many aspects of law department metrics (See my posts of May 21, 2008: with 9 references cited.). Parkinson’s Law cynically describes cynosures (See my post of Jan. 14, 2007: "Work expands so as to fill the time available for its completion."). Zipf’s Law illustrates the fundamental presence of power-law distributions (See my post of May 27, 2007.).

And, lest we forget, Murphy’s Law often seems to be handed down by the supreme court of life. If something can go wrong with a law department effort, it will go wrong.

For those readers who would like to reverse this post, invoke Gresham’s Law, which in obiter dicta might have held that “bad posts drive out good posts.”

In Edward Russell-Walling, 50 Management ideas you really need to know (Quercus 2007), the author mentions this so-called law (at 11). Data should serve as aids to analysis (See my post of June 14, 2007: basic good practices regarding data.).

The essence of the law is that once a social or economic indicator becomes a target for the purpose of conducting social or economic policy, then it loses the information content that would qualify it to play such a role. The law was named for its developer, Charles Goodhart (a chief economic advisor to the Bank of England).

Goodhart’s Law suggests that once a general counsel picks certain metrics to combine as a scorecard, the metrics begin to lose their value to inform. The reason is that the lawyers in the department start to “teach to the test,” to alter practices that the metrics used to say something about, to intervene in the reporting and analysis of the metrics, and to nudge them closer to the implicit or explicit goal.

Large law firms, those that have handled many matters of a similar kind, ought to realize that if they extract and analyze cost and timing data for those matters, they will have an edge. The edge would cut on competitive bids, on budgets, on staffing decisions, and on other internal management. The firms that do such an analysis will more precisely and credibly estimate costs for budgets, set fixed fees and explain the amounts; project staffing needs; predict resolution times, and calculate likely profitability.

The marketing edge alone would be substantial.

Why, then, is data mining – where some results are shared with clients and prospects – not prevalent (See my posts of July 21, 2005: data mining by a consortium; Jan. 25, 2007: business intelligence and data mining; and Feb. 19, 2007: does data mining mean anything.)?

Maybe law firms fear the data will usher in a harsher world where firms have to compete more on cost.

Perhaps managing partners do not think statistically valid conclusions can be drawn from available data on matters, or that all matters are unique. It could be that senior partners in firms are ignorant of techniques to make sense out of data. Or, cynically, they can’t bill for the time spent on the effort.

Some fear that such an analysis will put some partners or clients in a bad light.

It may be that general counsel do not ask their key firms for results from poring over internal firm data. I suspect there is great value to be had from the data locked up in large law firms.

Aside from being a fountain of youth (See my post of April 27, 2006: Continuing Legal Education may help lawyers live longer.), Continuing Legal Education for attorneys who work in law departments ought to have great value (See my post of Dec. 19, 2005: think of law departments in terms of “learning organizations.”).

Much is made about how vital it is for in-house lawyers to keep abreast of business developments (See my posts of Nov. 6, 2005: Continuing Legal Education should be Continuing Business Education; July 16, 2005: general counsel now “measured by their business acumen”; August 3, 2005: for general counsel, a stint on the business side; April 12, 2006: opportunities at universities for law department lawyers to learn about business; and May 7, 2006: in-house training on financial literacy.).

Talent management posts that refer to CLE and its importance in that domain have also been plentiful (See my posts of August 27, 2005: “Human capital” reporting; Sept. 5, 2005: career spotlights on up-and-coming lawyers; May 14, 2005: executive development courses for high-potentials; and July 31, 2005: succession planning.).

Diverse methods to deliver CLE and training generally have graced several posts (See my posts of July 14, 2005: spectrum of training methods; April 13, 2006: antitrust training at Philips; April 15, 2006: role play as a training technique; and March 8, 2006: law department education at Northwestern Mutual.). Among those comments are several about law firms and their potential contribution to CLE (See my posts of July 21, 2005: law firms help with training; May 28, 2007; distribute online TV feeds for CLE; May 24, 2007: law firms provide CLE training; and Dec. 1, 2006: knowledge transfer from firms to departments.).

Many logististical aspects of CLE programs have received attention (See my posts of May 31, 2005: bar membership and a law department’s role; Dec. 17, 2007: New Jersey requirements for CLE in-house; Feb. 1, 2006 #3: UK CLE requirements; Jan. 20, 2006: where CLE is mandatory, in-house compliance may be perfunctory; June 16, 2007: tracking CLE compliance; March 6, 2007: getting accreditation for CLE courses departments offer; Feb. 19, 2006 #3: Viacom accredited CLE program; May 24, 2007: outside counsel to provide CLE and save money at Allstate; June 9, 2007: thoughts on the distribution of training; May 1, 2005: spreading CLE knowledge to the rest of the law department; and June 30, 2007: the evaporation of knowledge gained formally.).

In the fall of 2006, San Francisco-based utility PG&E paid $337,296 to relocate its new general counsel. Hyun Park, from Allegheny Energy in Pennsylvania. This item, from Portfolio, June, 2008 at 36, witnesses to the high costs law departments incur – or some budget in the company incurs – when the department relocates a person (See my post of April 8, 2008: costs to move a lawyer to another city.).

Even so, lawyers in legal departments are moved from time to time as the needs of the department change (See my post of June 14, 2007: save money by relocating to a lower-cost city; June 7, 2006: BHP and its relocated lawyers; Oct. 10, 2005: ex pat pay and relocations; May 26, 2007: Royal Dutch Shell and its relocation of lawyers; May 14, 2005: turnover costs of lawyers includes relocation of replacements; and July 25, 2007 #3: Saks relocation of legal department.).

The legal department ought to absorb those costs in its budget if it believes it should state a total cost to the company of the department.

Other posts have discussed definitions of core competencies in law departments (See my post of May 23, 2008.) and some consequences of deciding on those competencies (See my post of May 23, 2008.). To complete a triptych of posts, let’s think about one other perspective: Is any specialist lawyer a core-competency lawyer?

Litigation should not be privileged because the unblemished, well-run company will confront little of it.

Employment law is mostly counseling and litigation rather than anything to do with developing talent in a company, so it is not a core competency. Companies hardly yearn for tough HR legal issues.

The same arguments hold for environmental problems and legal issues. A few companies that consume copious resources or produce noxious wastes may encounter difficult and strategic legal problems, but at bottom the companies care about their products, not the legal effluents.

For publicly-traded firms, securities law is required and mostly responsive, but not at all business generating, while anti-trust counsel is both defensive and offensive – for mergers and acquisitions. No company hankers for a good competition-law fracas.

On the other hand, for some companies their law departments give advice and counsel in areas of law that define the company, such as intellectual property or regulatory law. Those are certainly specialized areas of practice and should be considered part of the department’s core competency.

Law departments need to concentrate their expertise in those key areas of legal practice that are crucial to the company’s success. The fortunes of few companies rise and fall on their real estate activities (unless you are a REIT); few companies create shareholder value with environmental strategies (unless you are a remediation firm); none litigate to make profits (unless you are a patent troll). No corporation exists to pollute the countryside, sue and be sued, or cope with discrimination and harassment.

In short, aside from lawyers in some specialty-dependent companies, most specialist lawyers cannot sensibly be included in the circle of core competencies.

A previous post offers four definitions of core competencies for law departments (See my post of May 23, 2008.). What difference do the definitions make? Many, I submit.

First, however, a comment on legal-team size. Is it possible for small law departments, say those with two-to-five lawyers, to nurture core competencies as much as larger departments might? No, not as likely. When there are only a few lawyers, they are likely to be generalists. Even so, small departments too ought to gravitate toward some basis for deciding their priorities and building their skills.

Services de-emphasized. If a core competency is a strategic decision to press the pedal on some areas of law, then a law department logically ought to throttle back its efforts in other areas. Some brakes include triage, de minimis standards for what the department will handle, assigning low priority to certain work, self-help by clients, clients and law departments turning more to outside counsel, and delegation. Decisions regarding non-core activities help define the role of the law department and go far to shape client satisfaction with the law department.

Years of experience of lawyers. Does a concentration on core-competency work require more senior (read, expensive) lawyers? Not necessarily. The notion of core services does not necessarily mean that the legal work put on the pedestal is particularly sophisticated. Junior lawyers can also contribute on core services.

Knowledge management. To the degree that a law department targets certain areas of support as core, the department can build around that core various systems, training, guidelines, and quality control.

Outside counsel. If you narrow the work done inside to core work, won’t you find yourself retaining more external counsel? Or retaining different firms than before, on different terms? Possibly both, if you retain firms to handle peripheral work; but as you climb the skill curve of core competencies, you use law firms in those areas less (See my posts of Dec. 5, 2005: reverse the pyramid of what work should go outside; and May 21, 2008: experience curves.).