What if US law departments upped their management game significantly

Listening to John Lennon, my mind took a perverse turn and wondered what if general counsel in the US suddenly, all over, transformed themselves into wonderful managers.

Fewer in-house counsel, I imagined, because they would be much more productive, insightful, and attuned to their clients’ needs. On the other hand, with such talent and output, companies might crave more lawyers, not fewer.

Lower total legal spending as a percentage of revenue (TLS/Rev), I imagined, because the enlightened legal departments would avoid legal risk, resolve disputes efficiently, and squeeze more beneficial services at a high level from their budgets. On the other hand, finely-tuned experts might spot more issues and pursue more forms of legal services, so spending would rise.

Less use of outside counsel, I imagined, because the well-managed legal team would be more knowledgeable, hard-working and eager to take on the tough projects. On the other hand, general counsel would be better at sticking with core competencies and how to negotiate tough but fair terms with external firms.

Happier clients, I imagined, because the in-house legal team would understand their needs and competently meet them. But, it might also mean that law departments would stand up and resist work they shouldn’t do, introduce more legal issues into transactions, assert their independence and, in short, undo the good will that one would imagine from an improved legal function.

My point: unintended consequences bedevil every imagined change (See my post of Aug. 28, 2005: trade offs when actions are taken; Aug. 1, 2006: second-order consequences; Dec. 17, 2006: all practices have pros and cons; and July 10, 2007: well-intentioned actions that boomerang.).

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