What Is Legal Operations?

Summary

Legal operations has emerged as a critical function that bridges the gap between legal expertise and business efficiency. As corporate legal departments face increasing pressure to demonstrate value while managing costs, legal operations professionals serve as the strategic backbone that transforms how legal services are delivered. This article explores the definition of legal operations, its key benefits, core responsibilities, and how technology enables success in modern legal departments.

What is Legal Operations?

Legal operations is a multifaceted discipline that aims to streamline and optimize the delivery of legal services, ensuring efficiency, cost-effectiveness, and client satisfaction across the enterprise. Unlike traditional legal roles focused on practicing law, legal operations professionals concentrate on the business side of legal departments.

In corporate legal departments, two complementary sides work together: legal services delivered by in-house lawyers and outside counsel, and the legal operations team that manages the technical aspects, processes, and technology that enable smooth collaboration and workflow.

What is the Primary Goal of Legal Operations?

A law department has a singular goal: protecting the company. This encompasses a wide range of legal challenges, including intellectual property management, litigation support, regulatory compliance, and providing legal counsel to company stakeholders. Legal operations supports this mission by ensuring these services are delivered efficiently and cost-effectively.

While lawyers practice the delivery of legal services, legal operations teams practice the business side of law in partnership with others in the company. Legal operations directors collaborate with marketing, finance, product, engineering, procurement, and other departments to target the high-level strategies that make a business grow.

The role of legal operations is to bridge the gap between the practice of law and the business operations that support it. By applying principles of project management, process improvement, and data analytics, legal operations professionals strive to enhance the overall performance of legal teams.

What Are Key Benefits of Legal Operations?

A law department fortunate enough to have legal operations realizes an array of benefits. One of the biggest advantages of utilizing the legal operations function is the ability to plan strategically, prepare for challenges and celebrate successes. Managing and mitigating risk becomes a primary goal for legal ops teams, and that challenge is ongoing.
Implementing a robust legal operations strategy delivers measurable benefits that directly impact the organization's bottom line:

Increased Efficiency

Legal operations professionals analyze existing processes and identify areas for improvement. By streamlining workflows, leveraging technology, and implementing best practices, they help legal teams work more efficiently while reducing redundancies and minimizing waste.

Cost Optimization

Legal operations teams identify cost-saving opportunities and implement expense control strategies through data-driven decision-making. This includes optimizing resource allocation, leveraging alternative fee arrangements and implementing effective matter management practices.

Enhanced Client Service

By improving internal processes and communication channels, legal operations professionals contribute to superior client service delivery. Internal clients benefit from increased transparency, predictability and responsiveness, fostering stronger relationships and trust.

Risk Mitigation

Legal operations teams develop and implement policies, procedures, and controls to mitigate risks associated with legal practice. This includes ensuring compliance with ethical and regulatory requirements and managing potential conflicts of interest.

Data-Driven Decision Making

Through systematic collection and analysis of legal operations data, professionals provide valuable insights that support strategic decision-making. This approach enables informed choices about resource allocation, pricing strategies, and service offerings.

Responsibilities of Legal Operations Professionals

People working in legal operations are accountable for a variety of tasks. These include strategic planning; managing legal spend budgets and other financials; vendor recruitment and management; project management; talent recruitment; technology selection; and product procurement either in collaboration with a procurement department or on their own initiative.

Also at the core of the law department is the necessity to deliver value for the overall company. Corporate legal strives to positively contribute and influence the organization’s bottom line. As a cost center and not a revenue center, this is critical. The path to continuous improvement requires nimble and flexible behavior. This can be a struggle in a corporation that resists change or growth.

Strategic Functions

• Vendor Management - Overseeing the selection, negotiation and management of relationships with external vendors, such as legal service providers, outside counsel, consultants, and technology vendors.
• Strategic Planning - Providing data-driven insights and recommendations to support the strategic planning process, helping to align legal operations with the overall business objectives.
• Financial Management - Developing and monitoring budgets, analyzing financial data, and implementing cost-control measures to ensure the financial health of the legal department.

Operational Functions

• Process Improvement - Continuously analyzing and optimizing legal processes, from matter intake to billing and invoicing, to ensure efficiency and consistency.
• Technology Management - Evaluating, implementing, and managing legal technology solutions, such as document management systems, e-billing platforms, and legal research tools, to support the legal team's work.
• Project Management - Applying project management principles to legal matters, ensuring timely delivery, effective resource allocation, and adherence to budgets and timelines.
• Knowledge Management - Developing and maintaining systems for capturing, organizing, and disseminating institutional knowledge, ensuring that valuable information is accessible and leveraged effectively.
• Talent Management - Collaborating with human resources to develop strategies for attracting, retaining, and developing legal talent, fostering a positive and productive work environment.

The Role of Enterprise Legal Management Software

To function well in a legal department, the implementation of enterprise legal management software, provided by LexisNexis CounselLink, provides the core foundation for matter management, workflow and collaboration, vendor management, analytical reporting, financial management with smart billing, work intake, and contract lifecycle management.

In a corporate legal department with or without a legal operations function, enterprise legal management software provides a solid foundation to integrate the aforementioned systems within a single, unified workspace.

LexisNexis CounselLink+ brings all the benefits of the following features into one platform, integrated with various applications that create a legal operations hub.

Financial Management

Enterprise legal management solutions often have their roots in e-billing software. Financial management is a critical component of enterprise legal management software. It enables legal operations to manage the budget and establish billing guidelines and invoicing rule sets for outside counsel adherence. Moreover, smart AI-powered billing tools enable invoice errors to be flagged and correctly adjusted. Managed bill review services also exist to help with legal spend cost-cutting strategies.

Vendor Management

Included as part of a successful legal operations strategy is a robust vendor management program. This provides the ability to evaluate outside counsel in a side-by-side comparison from hourly partner rates and a win/loss record to the quality of legal services and whether legal teams are diverse. Vendor management dashboards in the enterprise legal management solution provide snapshots of performance. Analytical reporting is also developed as a bonus to department leadership to analyze performance, productivity and hiring choices for outside counsel.

Matter Management

Every legal department requires a case management platform. With enterprise legal management software, the matter management component is the primary element that makes the software collaborative. Lawyers open a matter within the ELM platform and manage every aspect of the matter from within the integrated solution. Moreover, matters are accessible from within Office 365 applications, so there is no hunting or pecking to identify a singular matter.

Contract Lifecycle Management

Often, legal operations professionals can choose to utilize a contract management system that is separate from the enterprise legal management platform. Preferably, legal ops should identify a solution that integrates them both. Contracts should link with matters so lawyers can reduce time seeking files and improve productivity by having a matter with its contract in one location.

Other benefits of enterprise legal management software make the legal operations function more streamlined.

Ready to implement robust legal operations in your organization? Contact us to learn more about enterprise legal management software solutions that can transform your legal department's efficiency and effectiveness.

The Future of Legal Operations

As the legal industry continues evolving and with the emergence of AI into the fabric of the legal department, legal operations professionals will remain increasingly critical to organizational success. By combining legal expertise with business acumen, they drive efficiency, cost-effectiveness, and client satisfaction while contributing measurably to organizational success.

The maturity of a law department depends on a variety of factors that influence the growth continuum toward optimization, efficiency and maximum value. The size of a department may or may not affect its maturity. Each corporate legal department does well in certain areas and poorly in others. Recognizing the challenges and the journey to adjust and become successful helps create a productive and efficient environment that aligns with cross-functional goals.

Legal operations represents the evolution of legal departments from cost centers to strategic business partners, demonstrating clear value through measurable improvements in efficiency, cost management, and service delivery.

TL;DR

Legal operations is the business side of legal departments that focuses on processes, technology, and workflow optimization.

• Primary goal - Bridge the gap between legal practice and business operations to increase efficiency and reduce costs
• Key benefits - Increased efficiency, cost optimization, enhanced client service, risk mitigation, and data-driven decision making
• Core responsibilities - Process improvement, technology management, financial oversight, vendor management, and strategic planning
• Success factor - Enterprise legal management software provides the foundation for effective legal operations