A few years ago, my manager challenged the legal department management team to come up with three crazy ideas to improve the department. The premise of the exercise was that if we were freed from the bonds of rational thought, we might produce some truly innovative ideas (which was funny to me because most of my annual reviews included pleas to develop some rational thinking).
When it came time for each of us to present our ideas, my boss announced that he would not consider a request for a raise or more IT infrastructure for the department as crazy ideas--some ideas, apparently, were deemed "way too crazy."
With two of my craziest ideas disqualified, I offered the following: What if we gave our corporate constituents the opportunity to conduct a bidding process for the legal work that the in-house legal team regularly handles? The in-house legal team would be required to respond to RFPs issued by corporate groups for the opportunity to provide legal services to the company. The bids would be open to both outside counsel and the in-house team. This crazy idea raised a compelling consideration: If the in-house team were not assured a "book" of work and had to compete for it, how would it stand up?
This was a crazy idea for many reasons but mostly because it's hard to imagine an RFP process that would support the daily coverage requirements (besides, in-house counsel would be nauseated by the prospect of responding to the RFPs to which we have laws firms respond). Also, the proposal incorrectly assumes that in-house and outside counsel are fungible service providers. Let us not focus on the method of competition but the fact of it.
This reminds us that deploying a corporate legal department is a choice. Our clients have choices among legal service providers, and they make their choices like any other consumer. Any department that has faced some outsourcing knows this well. On a more routine basis, requests for additional in-house personnel are usually evaluated in light of the alternatives (i.e., use of outside counsel). For some of us then, this competition has been palpable. Still, I am not sure that many of us sense this competition, understand our competitive advantages and invest in ourselves accordingly.
What are in-house lawyers' competitive advantages? Are we cultivating those advantages to provide a return on the company's investment? I believe our chief competitive advantage is our focus. In-house lawyers have the ability to focus on one client and its business objectives, strategies, risk portfolio, competitors, culture and personalities. Effective in-house lawyers become students of their firms and their people. This permits them to render advice tailored to the uniqueness of the business and its people. This focus is at the heart of the highly pursued "business partner" status and the true competitive advantage of in-house counsel.
This conclusion may not be startling. More difficult, however, is achieving the focus.
I use a "Friday Self Test" that is designed to prompt me to regularly focus on maintaining my competitive advantage. Here's the test:
What did I do this week to ...
...?EUR?better understand my company's products or services?
...?EUR?better understand my company's strategy, objectives and challenges?
...?EUR?better know my "clients" and their challenges and idiosyncrasies?
...?EUR?better know the other members of the legal department and their challenges?
...?EUR?maintain my expertise?
...?EUR?develop relationships with my in-house peers through in-house counsel networks tied to an industry or geography or through the ACC?
The self test guides in-house counsel to focus on the unique value-add that only an in-house team can deliver. It ensures a return on the corporate investment made in us. That's not such a crazy idea.
Brian Martin is senior vice president and general counsel of KLA-Tencor Corp.