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The clash between core-competency and full-service departments

Many law departments fancy themselves to be “full-service.” I believe that is the wrong vision.

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 their real estate activities; few create shareholder value with environmental strategies; none – except perhaps patent trolls – litigate to make profits. In short, many specialties of law will come under attack from this perspective.

In general, I feel that employment law is mostly preventive law and litigation rather than anything to do with developing talent in a company, so it is not a core competency. Securities law is responsive, not business generating, and anti-trust counsel is defensive.

For many law departments, core competencies (See my post of June 4, 2007 and nine references cited.) involve intellectual property, almost certainly contracts, and regulatory approvals. For consumer products companies legal support for marketing and sales are core competencies. Those practices areas demand the most from law departments and also depend on the most intimate knowledge of the client company.