The dead hand of path dependence lies on all law departments

“Path dependence” describes situations in a law department where “a decision made early on for one reason … influences behavior long after that reason is irrelevant.” Art Markman, Smart Thinking: three essential keys to solve problems, innovate and get things done (Perigree 2012) at 28-29, gives the example of the QWERTY keyboard. Supposedly designed to prevent mechanical keys from jamming, we are still saddled with a very inefficient layout of keys long after computers have obviated the risk.

Path dependence shows up all the time in law departments. That compliance does or does not report to the general counsel may have been set years ago because of the personality of the first head of compliance, long since retired, but whose legacy today determines the a key structural component. Or path dependence explains why business unit lawyers in Asia report to the regional VP but the lawyers based in Europe report to the global general counsel. Path dependence presents obstacles to law departments that want to inoculate themselves with another department’s “best practice” (See my post of Nov. 25, 2009 #2: path dependency obstructs borrowed practices.). When we questions our assumptions, especially the sacred cows, we may be able to spot the path dependencies and test them for present-day applicability.

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