Reporting to Corporate Management on Value of Legal Service

Reporting to Corporate Management on Value of Legal Service

Corporate law departments must develop a complete understanding of how the law-related matters entrusted to them create or deliver value to the business operations and that they develop a language and metrics by which they can communicate that information to management most effectively. The more a law department can use empirical data to demonstrate how and how often it delivers value the firmer its support within the company will be.

Mr. Lauer writes:

Corporate management needs to understand how well the organization performs in pursuing its business goals. This requires that each unit of the company educate management about its activities and how successfully it is pursuing the goals set out for it. Otherwise, the company might incur overly high expenses or various units' efforts might counteract each other or otherwise fail to mesh as well as they should. Management wants and needs to know that the company realizes sufficient value from each unit's efforts.

For corporate law departments, this means that they must develop a complete understanding of how the law-related matters entrusted to them create or deliver value to the business operations and that they develop a language and metrics by which they can communicate that information to management most effectively.

How do the company's attorneys (both in-house and outside) work with the business units and the personnel of those units? What are the company's priorities in respect of the lawyers' work? Which matters or projects represent the greatest potential "return" for the effort in the eyes of management? Which possess greater urgency?

One survey identified the following elements or types of value that lawyers provide to their clients (the survey did not distinguish between in-house and outside lawyers in this regard): service value, expertise value, commercial value and leadership value. Do these categories enable us to develop a means of describing the added value that results from the lawyers' efforts on a company's behalf?

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