F-statistic analyses. The F-statistic tests the equality of the means in a group of figures, which is used sometimes to separate sets of figures into categories, as mentioned in Laura Empson, ed., Managing The Modern Law Firm: New Challenges New Perspectives (Oxford Univ. Press 2007) at 99 (Brian Uzzi, Ryon Lancaster and Shannon Dunlap) (See my post of Jan. 20, 2007: statistics with 28 references and May 31, 2006.)
Half million lawyers on LinkedIn. Steve Matthews, founder of Stem, said at the 2009 ABA Tech Show in April that LinkedIn has 563,000 lawyers with profiles. That number, according to Ari Kaplan in Strategies: The Journal of Legal Marketing, Vol. 11, June/July 2009 at 8, has shot up from 406,000 in December 2008 and 118,000 a year before. My group, Law Department Management, has a paltry 200 members (See my post of Sept. 22, 2008: social networks such as LinkedIn, with 7 references.).
Definitions of global, international, regional and local. From a benchmark survey, I saw these definitions (See my post of June 26, 2009: what is a “foreign law firm.”). These make sense as nomenclature for legal departments:
“Global/multinational (operating in many countries on several continents); International (primarily European or operating in multiple countries beyond the home country); Regional (from the home country and operating primarily in the contiguous region); and Local (from the home country and only operating there).”
Differences among loser-pay countries, with some details. An article in Focus Europe, Summer 2009 at 42, by a Clifford Chance lawyer, explains the courts’ powers to award costs of the prevailing party against the losing party in seven countries. In England, “it is uncommon for courts to award a party more than about 60-75% of its actual costs.” In the Netherlands, “legal costs are recoverable on the basis of how many briefs were submitted and how many times the parties appeared in court,” but “the reward is usually only a fraction of the actual costs.” Each of the countries covered has a different scheme, but the upshot is that the award of fees is not as great as I had thought (See my post of Oct. 22, 2005: insurance proceeds in a loser-pays jurisdiction; May 31, 2005: insurance where the loser pays the other side’s fees; May 10, 2006: why US litigation hasn’t spread to Europe; Aug. 21, 2006: Florida experience with loser pays; Jan. 12, 2009 #3: Germany’s rules; and May 21, 2009: conditional fee arrangements in England.).
Having collected posts on several other legal departments whose management efforts have been well-publicized, I decided to tally them for Microsoft. Setting aside any references on Law Department Management Blog to the software licensed by Microsoft, I found 30 references to what that company’s enormous and active legal group has pursued. The posts cover almost every category on this blog, so I have organized them in chronological order within the categories.
Two posts hinge on benchmarks (See my post of Aug. 3, 2005: patents per billion dollars of R&D; and Aug. 4, 2005: benchmark study spurs more patents.).
Others cover cost controls (See my post of June 15, 2005: outsourcing to reduce costs; Nov. 3, 2005: savings on e-billing; May 13, 2007: litigation against patent trolls; Nov. 11, 2005: $100 million spent on patent litigation; and Sept. 3, 2008: savings from offshore patent support.).
The category of outside counsel was under-represented (See my post of Jan. 4, 2006: dealing with firms across borders.) as was productivity (See my post of July 21, 2005: collective activity with GM and Cisco.).
Structure has the most blog entries regarding Microsoft (See my post of Aug. 27, 2005: law department includes government affairs; Aug. 27, 2005: supports own IT staff; Dec. 19, 2005: a legal and corporate affairs department of 850; April 30, 2006 #5: “procurement manager”; Aug. 8, 2006: its top lawyer in Europe; Jan. 4, 2006: Deputy GCs; Feb. 7, 2007: IP czar appointed; and Jan. 11, 2009: staff foreign offices first with generalists.).
Technology – well, we should expect Microsoft to excel (See my post of Jan. 4, 2006: uses document assembly; April 9, 2006: joint portal development; May 16, 2006: survey by Microsoft found that matter management systems are the least successful technology; Feb. 6, 2007: uses DealBuilder software; April 8, 2007: law firms help with rule-based drafting; Dec. 11, 2007: software to classify patent portfolios; and May 3, 2008: internal blogs.).
Talent, too, had a cluster of posts (See my post of April 6, 2009: Brad Smith as one of 20 most influential GCs; June 9, 2009: three tenors and also GC of Microsoft; May 2, 2008: employee-satisfaction poll; May 3, 2008: GC has monthly breakfasts with staff; May 8, 2008: online tool to allow comments after Town Halls; and Dec. 5, 2008: contributions as sponsor of conferences.).
The War of “Legal” Department vs. “Law” Department! The brawl over “Associate” vs “Assistant” General Counsel!! The vicious struggle between backers of general counsel (plural) and general counsels. The endless and cruel conflicts over word choices that go to the heart of one’s self and the meaning of life.
So, to hyphenate or not to hyphenate. The ultimate arbiter, the uber-crowdsource, Google, reports that a search for “in-house counsel” returns 638,000 hits. A search for the unhyphenated twin, “inhouse counsel” returns a meager 12,500. A 50-to-1 lead trumps even election returns in Iraq!
But solid empirical research demands more. “Inhouse lawyer” has 10,200 hits; “In-house lawyer” has 74,500 (7-to-1 ratio). “Inhouse attorney” barely registers at 809; “In-house attorney scales 62,100 hits.
I make the tough calls and I call them right: hyphens by a huge point spread, you in-housers!
Rapid growth of Starbuck’s legal department. Corp. Bd. Mbr., Vol. 12, 2nd Quarter 2009 at 46, says that after Paula Boggs became the general counsel of Starbucks in 2002, she “tripled the size of the legal department to 147 attorneys.” That is caffeinated growth and adds to this blogs collection of rapid expansions (See my post of May 10, 2007: Clayton Holdings; Feb. 19, 2006 #4: Home Depot; Nov. 19, 2005: Google; June 4, 2007: Wal-Mart; and June 11, 2008: an Abu Dhabi growth spurt and Caterpillar’s.).
Seyfarth Shaw and Six Sigma for litigation. According to a Bloomberg article by Cynthia Coutts, FMC Technologies chose this firm as a finalist in its ongoing selection process because it uses Six Sigma techniques to manage litigation more efficiently. Six Sigma is a business management system developed by Motorola Inc. that uses statistical analysis to improve the quality of processes (See my post of Feb. 13, 2008: Six Sigma with 18 references.).
Paying firms by credit card, quickly. FMC Technologies offers one especially sweet carrot to the firms it retains: It pays law firms by credit card within 15 days of billing, according to a Bloomberg article by Cynthia Coutts (See my post of May 11, 2008: prompt payment with 10 references.).
ISO 9001:2008 certification for legal service providers. Novus Law, an international legal services firm (an LPO), is the first firm in the global legal industry to achieve the new ISO 9001:2008 certification from Underwriters Laboratories. The accreditation specifically highlights the Novus Q and Novus Process document review and management systems. (See my post of April 28, 2009: ISO certification by a law firm.).
Seven hundred years ago, circa 1290 AD, clients needed guidance on how much to pay lawyers. Fees were to be based on “The amount of the matter in dispute, the labour of the serjeant, his value as a pleader in respect of his learning, eloquence, and repute, and lastly the usage of the court.” This early statement of value billing, decreed 700-plus years ago, comes from The Mirror of Justices, Book II, c.5. Selden Society Edition, 1895. Having inexplicably overlooked that source, I am grateful for the clue from Laura Empson, ed., Managing The Modern Law Firm: New Challenges New Perspectives (Oxford Univ. Press 2007) at 117 (Huseyin Leblebici).
With 4,500 posts under my belt, I looked back over the distribution of posts by the dozen substantive categories I use.
Outside Counsel Mgt. (976)
Talent Mgt. (602)
Mgt. Tools and Initiatives (566)
Productivity (428)
Controlling Legal Costs (428)
Metrics and Benchmarks (224)
Structure (213)
Showing Value (166)
Client Satisfaction (133)
Decisions and Cognitive Styles (128)
Technology (112)
Knowledge Mgt. (107)
Somewhat ruefully, I wish I had put many of the posts that languish in “Mgt. Tools and Initiatives” into the more specific category to which they pertain, such as tools to control costs or initiatives to improve talent. With that reassignment, many other posts in the category might properly belong to “Productivity.” “Technology,” I realize now, is a productivity tool usually, so I could roll them together.
Similarly, many “Metrics and Benchmarks” pertain to a more focused category, such as outside counsel or structure. “Controlling Legal Costs” has evolved mostly to cover controlling non-law firm legal costs. I have come to believe that “Showing Value” should have been a part of “Client Satisfaction.”
Another consolidation would be to roll “Decisions and Cognitive Styles” into “Talent Management,” and I might as well pour in “Knowledge Management” at the same time. While I am tidying up, why not drop “Mgt.”? In short, going forward my categories will be “Outside Counsel,” “Talent,” “Costs,” “Structure,” and “Client Satisfaction” (why not “Clients”?).
Thus, legal department management boils down to people inside and out, how they are arrayed, and the associated expenses of serving the corporate client.
Ten more embedded metaposts (See my post of June 7, 2009: Part XXXIII), each embellished with the number of its back references.
Law departments of Asia (See my post of June 13, 2009: Asian law departments with 12 references.).
Collective actions (See my post of June 10, 2009: joint collaborations by legal departments with 18 references.).
Decision trees (See my post of June 17, 2009: decision tree software with 6 references.)
DuPont (See my post of June 7, 2009: E.I. DuPont with 32 references.).
Finance department (See my post of June 18, 2009: interplay of finance/accounting and legal with 19 references and 2 metaposts.).
FMC Technologies (See my post of June 7, 2009: Jeff Carr and FMC Technologies with 15 references.).
Human Resources departments (See my post of June 14, 2009: HR departments with 16 references and 3 metaposts.).
SharePoint (See my post of June 9, 2009: SharePoint with 6 references.).
Technology support IT staff (See my post of June 16, 2009: Information Technology staff group with 23 references and 1 metapost.).
Translation services (See my post of June 5, 2009: translating documents with 7 references.)
Imagine! An image on this stodgy blog. Inspired by What About Clients, I inserted an image into a recent blog post. Invoking the Three Tenors of opera fame, I found a picture of them online, figured out how to save it and uploaded it to TypePad, although I did not size it or scroll text around it. For a visual guy, which I am, it’s been a long 4.5 years to get to one tiny bit of eye candy (See my post of June 9, 2009: three publicized general counsel.).
Another online community for lawyers, ESQChat.com. ESQChat.com is a private legal community committed to providing an online meeting place for attorneys to ask questions, learn more about the law, and make new acquaintances. The most recent post on its blog is dated August 14, 2008, however, so the online chatter has died down (See my post of Sept. 22, 2008: social networks such as LinkedIn, with 7 references.).
Group for general counsel and chief legal officers on LinkedIn.
Mark Harrington, the general counsel of Guidance Softwaremark., formed the special interest group on July 23, 2008. In less than a year, the group had attracted 386 members on June 4th. Harrington wrote me that the group “gets probably 10 requests each week for new members to join. We get probably twice that many requests from vendors, law firms etc…. to join. I took a survey a few months ago about membership criteria for the group and the consensus was that members had to be 1) current or recently former GCs or chief legal officers of U.S. and international companies or, 2) those folks whose function was equivalent for their particular operating entity.” He added: “As for vendors and law firms, I often invite them to contribute to discussions or post their wares on our jobs or resource board – but not join as members.”
Barriers to entry, a useful term from economics. Incumbent law firms have erected what economists call barriers to entry. Their known skills, styles of working and billing structures powerfully bind entrenched firms. Finding a replacement firm, getting to know its kinks and capacities, smoothing out the ways of working between client and firm – these impediments raise barriers to entry (See my post of Dec. 17, 2007: challengers to incumbent firms; and Feb. 6, 2007: hard for a newcomer firm to show chemistry.).
Portfolio theory, from investors, might inform decisions on law firms retained. Perhaps some of the notions and corollaries of portfolio theory apply to the law firms invested in by a law department. There is some level of risk with all law firms and some level of volatility -- turnover and uneven quality. There might be a way to model mathematically the portfolio that has the lowest cost and risk (See my post of March 23, 2008: risk management with 18 references.).
Who are the Pavarotti, Carreras and Domingo currently singing the leading roles as law department managers and innovators? Tom Sager of DuPont, Mark Chandler of Cisco, and Jeff Carr of FMC Technologies are center stage and the tenor of their contributions has been projected far and wide.
Between the three of them, their opera (plural of opus) on this blog amounts to nearly 80 posts (See my post of Sept. 25, 2008: Cisco with 30 references; June 7, 2009: E.I. DuPont deNemour with 32 references; and June 7, 2009: Jeff Carr and FMC Technologies with 15 references.).
Strong supporting roles are sung by Brad Smith of Microsoft and Brackett Denniston of General Electric (See my post of June 30, 2006: law departments frequently in the management press.).
I say, “Bravissimo! Encore!”
For all my readers in Brazil and Portugal, a little background:
Um consultor bem informado para advogados escreve no blog LawDepartmentManagementBlog.com. Há mais de 4,000 arquivos (à partir do primeiro de Fevereiro, 2009) divididos entre 13 categorias. Há 20 anos que, Rees Morrison, um advogado antigo dos Estados Unidos, tem consultado o concílio geral em como administrar melhor os seus departamentos de direito. Com mais de 275 projetos de consulta, Morrison tem avaliado a operação dos departamentos de direito, tem recomendado métodos de reduzir os seus custos, tem recolhido e analisado dados de ponto de referência, tem coletado as classificações de satisfação dos clientes com os advogados, tem sugerido aperfeiçoamento à estrutura do grupo de advogados, tem avaliado os necessidades de tecnologia dos funcionários principais e dos seus própios advogados, e tem analisado a eficácia das melhores práticas e processos. Alèm disso, Morrison tem trabalhado com vendedores e com firmes de lei para fortificar as suas relações com os seus clientes.
Morrison junta-se com outros consultores peritos nas áreas de conformidade, governo corporal, documentos de gerência, diversidade, documentos de assembléia, e gerência de negócio ou "e-billing software." Vale dizer que ele tem servido como uma testemunha perita na prática de faturamento.
Para aprender mais sobre Rees Morrison, a sua consulta e os seus publicações, e só entrar no site ReesMorrison.com.
Jeff Carr’s eight-lawyer department at $4.6 billion FMC Technologies punches far above its weight when it comes to innovative and publicized management efforts. Consistently he not only comes up with progressive ideas but also publicize them (See my post of June 30, 2006: law departments often in the news for management initiatives.).
The litany of FMC Technologies’ litigation endeavors is long (See my post of July 21, 2005: website evaluations of law firms; Aug. 21, 2005: don’t hire a head litigator; Oct. 24, 2005: decision tree software; Oct. 24, 2005: disbursements included in rates; Oct. 24, 2005: local counsel costs are part of primary firm’s budget; May 16, 2006: cycle time reduction; Nov. 20, 2006: can’t close matters without a law firm evaluation; Dec. 11, 2007: patent on the ACES system for cost management; April 15, 2009: 6-item form to evaluate law firms; March 5, 2009: 10% and 5% discounts demanded, depending on stage of matter; and May 13, 2009: Litigation Value Challenge.).
Some other FMC posts cover management efforts aside from those affecting law firms (See my post of Jan. 25, 2006: timetable for budget submission; Oct. 26, 2005: contract managers are not in the law department; and Nov. 20, 2006: lawyers dedicated to business units.).
