Managed Legal Services: 10 Tips for Success

Managed legal services offer in-house legal teams a way to address low-risk and/or high-volume tasks efficiently, thereby leaving them free to focus on more strategic matters.

Sadly, managed legal services programs often underwhelm and risk being overlooked as part of the strategic plan to help optimise legal team performance and drive ongoing transformation.

In this article, we offer you 10 tips to drive managed legal service success. Our tips are derived from real-world experience in successfully delivering hundreds of managed services accounts and legal operations managers.

Let’s get straight into it – with our list of 10 things "to do" and/or definitely "don't do".

A POWERFUL LEGAL OPS TOOL: 

Legal teams working in-house can benefit from utlising outsourcing and/or managed legal service solution. Such resources can play an important legal operations / legal team transformation role.

Our experience shows that more than hard-nosed contract negotiations, a more qualitative legal operations approach is required - that is a strategic focus on achieving desired outcomes efficiently.

1. Subject Matter: managed legal services work best if they focus on low to medium-risk and/or high-volume non-complicated tasks (e.g. NDA reviews, vendor onboarding, etc).

Scale down your ambitions for your first managed services programs – start with really simple tasks and then scale up from there.

2. Legal Process Infrastructure: for your program to work – you need to build exceptionally robust process support infrastructure. i.e. clearly define the how-to, by when and in what form guidance.

Don’t expect your service provider to do this for you – you must invest the time to define all associated processes in super clear terms so that outcomes are by in large assured.

A good service provider will have optimised processes to support service delivery, but what is delivered (e.g. the issues to be reviewed, the form or deliverables, etc) is up to you.

3. The Sales Person: if the person selling you the managed service capacity is not key to the implementation team on your account – consider that a clear warning sign.

A root cause of failure for many managed legal service programs is that they have been over-sold. As such, it often pays to ensure that the architect of your solution is actually on the implementation team that supports your legal function.

It is very important that the Head of Legal / Chief Legal Officer / General Counsel looks beyond the "sales" stage and looks for comfort around the "implementation" stage.

4. Location is important: not every managed legal service program needs to be outsourced to low-cost jurisdictions such as India or South Africa.

Many legal ops teams have examined low-cost jurisdiction options, but the results have not always been as desired.

The sophisticated legal operations teams will not conflate managed services and legal outsourcing with only low-cost jurisdictions. That is a naive and outdated approach to this type of legal team initiative.

The best providers use the most expensive legal talent deploying sophisticated processes and advanced legal tech to deliver a cost advantage. After all - who doesn't want their work done by the best legal professional talent available?

The reality is the best performance-managed service may well be capable of being delivered in your own jurisdiction, and by the same people that you went to law school with or that you have/could count as colleagues.

5. Drudgery Factor: the reality is that any person reviewing your NDAs (or similar) day in and day out (especially if they are top-shelf talent) will get bored of that work quickly. The same can be expected when you give your own in-house counsel team members nothing but the same work type.

The nature of the work often results in outsourced/managed legal service teams experiencing significant churn rates. Would you want to spend years solely reviewing NDAs? - that is document review hell!

Just because team members come and go from the service provider – it does not mean your managed legal services program is not working.

Rather, you must accept that what makes your account work is in fact PROCESSES – it's the process that you have outsourced so you must be really clear on what those processes look like.

6. Data Insights & Improvement: your provider should be capable of delivering data-based insights on the performance of your managed service programs. 

When you do something in great volumes – the scope to optimise the process becomes greater. As such, you want to be working with a provider that is committed to perpetual improvement.

7. Choice & Options: the secret to a really successful managed legal service program is limiting the choice and optionality that you expect your provider to exercise.

As far as possible – you must limit the instances where the exercise of judgement is required. If the provider must exercise their subjective judgement, it must be within clearly defined parameters.

Policies and processes that allow for discretion yield lesser outcomes than those that dictate precisely what is required.

Whilst not always possible, being prescriptive on every step of the managed service process is the guiding-light to which you should navigate.

8. Cost Imperative: when it comes to managed services – cost is by in large an irrelevant metric against which to judge a service provider's suitability.

Something might be expensive but if it delivers you greater productivity, output, quality, transparency, reporting accountability and constant improvements – it’s the better option.

At the end of the day – when you engage with a managed legal service you want to know that everything is being handled the way you want it. That is what you are buying.

9. SLAs: it's good to have them – and make sure they are meaningful. Stick to quality-based SLAs, not quantity. Select no more than 6 KPIs that will collectively tell you everything you need.

10. Training, Training, Training: your organization is dynamic, as is the law and market practice. You must be prepared to provide a constant knowledge management stream / upskilling / feedback to your provider.

PERFORMANCE MANAGED LEGAL SERVICES - KEY WORD "MANAGED"

The above 10 tips place little to no emphasis on aggressive provider contracts and focus more on the reality of managed legal service provision and success-based behaviors.

Setting and forgetting is a nice ideal for managed legal services. However, the “managed” component is not just for the provider – you too must be a proactive manager of the provider. Vendor management will be key.

Managed services can be a tremendous asset to an in-house legal team allowing them to enhance their strategic focus – which is great for your business and your legal team transformation.

When done correctly – managed legal services can achieve far greater outputs than a dedicated full-time hire can typically achieve for around the same cost. It is a viable strategy, and it works. It can be a great tool for legal team financial management and your overall legal transformation / legal operations function.

Ready To Transform Your Legal Team?

Please check out the GLS solutions and know-how resources listed on the right side of this page – they might assist your legal team with the issues explored in this Blog. 

© The GLS Group - Law Rewritten