The modern history of legal department management is only about 15 years old. Up until the early 1990s legal departments were small, disrespected and characterized as the "nursing homes" of lawyers who couldn't handle the pressure of law firm life. In most cases, those seeking refuge from billable hours and the complexities of serving multiple clients staffed legal departments.
CLT's mission was not only to change the stereotype, but also to teach GCs how to be better businesspeople.
A lot of our early issues featured stories on the integration of business and
management strategies into the legal function. The need was obvious, as
law firm lawyers who found themselves at the helm of a legal department
often lacked business training and management experience.
Those early issues of Corporate Legal Times featured columns on "Total Quality Management" written by law department pioneer Joel Henning, then, and now, of Hildebrandt International (which The Thomson Corp. acquired in January). Henning, along with his colleagues at Hildebrandt and the folks at Altman Weil and Andersen [now Huron Consulting] deserve much of the credit for the rise of general counsel to their current positions as trusted
business advisers and leaders.
But the playing field looks nothing like it did when we first started publishing Corporate Legal Times. It has evolved and morphed, and we, along with these consultants, have helped general counsel change with the times. I think it is time for them to change again.
In those early years, the experts, as well as Corporate Legal Times, encouraged general counsel to ditch the law firm management style. We argued that the law firm structure was wrong for corporate America and that GCs needed to start thinking of themselves as businesspeople rather than lawyers. We assumed the law firm management model wasn't going to work in the business world. There was no way, we argued, that a flat organization filled with Type-A individuals who are specialists, not generalists, could survive. More importantly, we argued that a business model where individuals are compensated for their ability to serve individual clients in a narrow capacity was flawed.
We were wrong.
The new buzz in corporate America management is to align businesses not along functional lines (manufacturing, for example), but rather along product or service lines. Take Disney and Apple as examples. Disney has films, theme parks and TV networks; Apple Computer has the Macintosh line and the ubiquitous iPod. These product lines need to be serviced by people who have very unique talents--specialists who understand the sub-markets and know how to win in a hyper-competitive market. What they don't need are
generalists, whether those people are engineers or lawyers.
As American businesses wake up to the reality of market segmentation and realign their business units along specialization within an industry or product, maybe the traditional law firm model is the right model after all. And as such, legal departments that are large enough may want to consider the "old" law firm model.
There is a current trend of tremendous consolidation among firms (large law firm mergers are announced on a daily basis), as well as pressure by CEOs and CFOs to use as few firms as possible (under the auspices of being able to leverage that consolidation for a reduced total legal bill). But such consolidation may not be what's best for the company's legal department in the long-term. In today's changing corporate landscape, legal departments need access to firms with specialized talents. In other words, they need more choices, rather than fewer.
This magazine will continue to provide the tips, tools and techniques (as well as the supporting evidence) to help you succeed in a hyper-competitive environment. As will those pioneers who make a living advising legal departments on how to best manage, organize and compete. Experts sometimes miss the mark though, and the way the lawyers have been doing it for decades really may be the best business model after all.
Let me know what you think by e-mailing me at email@example.com.
Nat Slavin is the publisher of Corporate Legal Times.