Enjoyed speaking at the Association for Corporate Counsel Conference yesterday but not surprised when I asked for a show of hands from those who would…

….describe themselves at a dinner party as “I am a businessman/woman/leader/etc.” first rather than “I’m a lawyer”? Zero hands went up. And so it should be. The fact is that the role of in-house lawyers is still fudged; no sooner had we heard form the plenary panel, consisting it seems to me mainly of a top cadre of lawyers who are also natural business leaders, that in-house counsel must be business leaders “who happen to be lawyers” – a clarion call which did not quiet ring through with a straw poll of rank and file delegates. Later in the day we constantly heard speakers use the “the b phrase” I.e. “the business” as if somehow their salaries were paid by magic from some remote and distant body; worse the “bp phrase” was used, I.e. “business partner”. Unless in-house counsel want to go down the cul de sac which is, sadly and not of their making, the lot of a substantial segment of HR – they might consider that the only time the phrase “business partner” should be used properly is when you invest money in a business, with a partner. Otherwise it can sound like a support function struggling for an identity. In-house counsel should not and does not have to apologise for itself; but I sense a lack of confidence in some lawyers in asserting themselves within the business”. I now believe (and I have changed my mind having spent the last four years working with lawyers) that in-house can never fully, because of their “cop role”, become part of “the business” but must become a business within a business delivering excellent counsel and legal process which adds value to the business in return for cash and “soft” benefits. I am submitting  a paper on this to the ACC and will publish it here also. 

Ciaran

5 thoughts on “Enjoyed speaking at the Association for Corporate Counsel Conference yesterday but not surprised when I asked for a show of hands from those who would…

  1. Ciaran, I think the dynamic here is the same as that in IT or HR: Firstly, legal work is a technical specialism and, like all specialisms, the skillset and outlook needed to attend to the critical detail is not the same as that needed to holistically understand how business works – the innate thinking style of most people who understand legal issues and process is different to that of an executive or a management consultant with much less. Referring to “The Business” usually comes naturally to technical specialists whose wider knowledge of business is sketchy….thus there tends to be a need for leaders and “business partners” who can bridge to the needs of the business. Secondly, business is increasingly becoming “service-oriented”, i.e. defining and managing in-house services (Legal, IT, HR, Finance, FM) the same as if they were externally provided and seeking to “plug and play” them. This means there will be increasingly sharp lines drawn around them and they need to be seen to operate commercially and deliver to service level agreements (rather than being loaded into overhead costs and only loosely performance managed)….so at the same time the distancing from the business is inevitable and there is a need for leadership and business partnering to manage the “account” across an at least quasi-commercial relationship. Thirdly, and related to the two preceding points, the economic trend is for organisations to try to commoditise what they do. This means any service provider (internal or external) needs to think hard about whether it wants to be “best of breed” or a commodity. The latter drives prices down (and sure enough the legal industry -and to an extent the management consulting industry- is under huge pressure towards commoditisation with strong downward pressure on rates). Most service providers would want to be best of breed….but an in-house legal team can’t be best of breed for legal advice per se – they have to hire generalists since specialists would be under-utilised a lot of the time…their only way of differentiating is to understand the specific business better than anyone external and to become very effective in managing in best of breed external expertise when needed and efficiently managing a pool of generalists the rest of the time. As per the first point, there is a skills deficit when it comes to doing these things. This is thus quite an economic trend/problem.

    Regards
    Duncan

  2. Duncan

    Thank you for taking time to write such a thoughtful reply. We agree on several points and not on others: I agree that the dynamic here is the same as that in HR, but not IT. HR is a fudge because the CEO should be the HR Director but the CEO does not have to be the CIO or IT Director. (He or she cannot be the GC). There is no evidence to suggest that IT is a service in search of a role or purpose whereas Legal and HR seem to have fallen into this trap, not entirely of their own making. I agree that the skillset needed is not the same as that needed to holistically understand how business works but that doesn’t explain why CFOs do not encounter the same problems which GCs encounter on this issue sine the skillets required are similar. I simply do not believe the term “business partner” is helpful because it’s management speak. A business partner is someone who invests in a business with another partner. Lawyers cannot be business partners because they don’t usually invest in the business and many, tho’ not all, of them don’t know much about running businesses. I entirely agree that Legal needs to deliver to service level agreements and that there is a need for leadership in managing not just external counsel but also the talented in-house lawyers on their teams as well as the internal and external legal processes and that there is a worrying skills deficit in some lawyers, tho’ not all, in this regard. I will address these issues more fully in my White Paper.

    Best wishes and thanks

    Ciaran

  3. fascinating stuff this and most of the time I try an avoid getting too involved in this type of exchange. However, knowing a little bit about in-house lawyering, I couldn’t resist responding. As my grandmother would have said – some of what is written is a ‘load of battleships’ and I worry about some of the judgments that are arrived at.

    I agree with Ciaran on one thing, however and that is, there is a lack of confidence within the in-house legal community. There is a lack of belief in the broad skill set in-house lawyers have and in many ways it is the education that they receive that is primarily at fault. There is not enough business focus. But to be a successful in-houser and the same equally applies to PP lawyers (who have as their client base, businesses) have to see themselves as business-people, business leaders and not just lawyers. If they are going to be successful in the advice they give, they have to be seen to be part of the business, understand it and think like it. They can’t and must not stand on the sidelines. The so called ‘cop role’ that the in-house lawyer allegedly plays is no different from any other person that sits around the business table. It’s how you say ‘no’ or advise against a course of action that counts. Any business of integrity and growth ambition will want everyone of its people, from the receptionist downwards, to advise against the execution of a poor and ill thought-through decision. So let’s not pigeon hole lawyers or HR people for that matter or any other skill set. I have worked with some brilliant people in the HR/People teams.

    Ciaran, I am surprised you have changed your mind – seems like a step back-wards to me…..

    ND

  4. Dear Nick

    I’m very grateful for your taking time to get involved in the debate particularly since you are such an experienced and senior GC. All the more reason therefore that I should justify my “battleships”.

    I feel endorsed, given your long experience, that you agree with the lack of confidence point. I agree with you also, as do many others, with the need for a complete overhaul in the business, leadership and management training of all lawyers, not just in-house.

    Furthermore I agree that they have to see themselves as business-people, business leaders and not just lawyers and as part of the business. I particularly like your “understand it and think like it”.

    However, I disagree that the ‘cop role’ “is no different from any other person that sits around the business table”. The role is different because no other person in the business is primarily, and I stress primarily, motivated by delivering excellent legal counsel and process. With some exceptions, and I suspect you are one, most lawyers are motivated by this role first and an interest and a motivation in business second. And that’s as it should be.

    Nowhere in my speech, in my remarks or in the white paper which I’m about to publish have i suggested that lawyers or HR people for that matter should be “pigeonholed” or are not “brilliant”. Indeed the opposite. I argue that both lawyers and HR People should resist the fudge being visited upon them by “the business” and with which they sometime collude. I have previously written a separate white paper in favour of an overhaul of HR to their advantage – see http://www.ciaranfenton.com. I am now suggesting the same for Legal.

    I’m not surprised your surprised that i have changed my mind – a step which I see as evidence of personal growth and understanding and not a “step backwards” – because i used to believe that lawyers especially senior GCs could and should become brilliant business people, generically. I now feel that whilst they can and should, as my white paper will explain, become brilliant leaders and developers of lawyers and managers of legal process and commercially very sensitive they don’t have to become brilliant at business. Some, like you perhaps, will.

    If you feel some of what I have said already is “battleships” I shudder to think what you will say about my white paper. But I very much value your opinion. Watch this space.

    Ciaran

    • Ciaran, I do look forward to reading your White Paper. I hope you will examine closely the changing nature of the in-house role, the move to a much more rational outsourcing and a much greater focus on how the in-house function can service the business efficiently and effectively. This in-itself will allow the business lawyers to concentrate on business strategy; getting much closer to the business and playing a much broader role. I do feel, from what you are saying, that you are moving to pigeon hole them too easily so please keep an open mind……………

      ND

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