Doing more with less: best practices from Corporate Counsel’s Best Legal Department winners

By Sharon Golec on Wednesday, June 23rd 2010
Management des Directions Juridiques

In its June issue, Corporate Counsel magazine (www.corpcounsel.com) named the legal department of Microsoft Corp. (459 in-house lawyers worldwide), led by general counsel Brad Smith, as the winner of its annual award for the best U.S headquartered in-house legal department. The legal departments of Discover Financial Services (34 in-house lawyers), Hewlett-Packard (425 lawyers), and The Williams Company, Inc. (energy sector) (39 lawyers) were designated runners-up.

While the editors found the Microsoft team’s astute handling of « bet the company » litigation such as the settlement with the European Commission, ending a ten-year antitrust battle, and major appellate victories in patent defense cases particularly convincing, the department impressed the editors for another reason, not usually associated with the software giant: doing more with less. Budget and staff cuts forced the department, already known for its focus on return on investment and innovative use of metrics and technology, to become even more efficient.

The Microsoft legal department made improvements in a wide variety of areas, including:

  • Streamlining internal processes with business people
  • Drastically reducing the number of contract templates (from more than 1800 to 212) and implementing a contract management tool
  • Revising the department’s internal website to make information more accessible to business people
  • Setting up a new legal panel
  • Negotiating more alternative fee arrangements with outside counsel
  • Implementing software to help attorneys better track outside counsel spending
  • Revamping the patent application process, including outsourcing routine work to India

The much smaller legal department of Discover Financial Services won kudos for its general counsel’s ability to leverage ressources. For instance, the department developed standard agreements for the most frequent deals, and delegated their initial preparation to non-lawyer contract specialists in the business teams, trained to seek lawyer input only on legal issues. An impressive array of knowledge management tools (blogs, templates, videos, websites…) helped in-house lawyers of The Williams Company, Inc. to become more efficient, increasing client satisfaction through faster turn-around time.

Lawyers at The Williams Companies, Inc. focused on using technology to increase outside counsel efficiency : the collection and analysis of extensive data on the department’s use of outside counsel allowed lawyers to accurately estimate the amount and type of work that each of the company’s law firms would perform annually. This facilitated putting in place blended rates and annual budgets for each firm, paid in equal monthly installments. The team also designed a process for better managing document filing and retention, then had software customized to meet their needs.

Implementing best practices such as these requires setting priorities and designating internal ressources willing to take them on as project managers, but the payback can be significant. They provide an excellent opportunity for general counsel to demonstrate through leveraging limited ressources that the legal department embraces overall company goals of efficiency and increasing return on investment.

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