Back in 1991, when I was part of the team that launched Corporate Legal Times magazine, our audience was corporate counsel and our business model was to deliver a professional place for law firms to advertise to them. Nevertheless, four technology companies bought into that first issue, even though it was not all that clear who exactly bought technology in a law department. (For the record they were CompInfo, Lawtrac, TechLaw, and Westlaw.)
I used to joke that usually the key player was an AGC who took some computer programming in college or the paralegal who got caught unjamming the photocopier one too many times. Only it wasn’t really a joke. Only when the law department operations role emerged in the 2000s was there a real answer. “There’s not always a law department operations professional. But when there is, that’s your person.”
Over the next few years, it became obvious that these law department operations professionals, or LDOs, might be rare, but they were powerful. And they did a lot more than buy technology. Except for legal services — admittedly a big exception — they bought everything. It was clear to me even then that LDOs were going to become a force in law departments.
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I was noodling on what to do about this when I met David Cambria, then head of legal operations at Aon Corporation, in early 2008. David was seeing the same thing. Along with Aaron Van Nice and Elizabeth Jaworski, he had already co-founded the Corporate Legal Information Consortium and was meeting quarterly with a handful of Chicago areas LDOs. Neither of us, however, had anything resembling hard data, so I asked, “Why don’t we go get some?” We got Huron Legal (now known as Consilio) to join us, and that’s how the Annual Law Department Operations Survey came to be.
We spent hours writing that first survey, and called in every favor we had to get 34 companies to respond. There were a few surprises in the results; for example almost 90 percent of our respondents had others reporting to them. But for the most part, the results confirmed our suspicions, especially in how LDOs related to outside counsel. Back in 2008, 80 percent of our respondents had preferred provider networks, but only 16 percent directed or managed the selection of the law firms in those networks. And only four percent selected outside counsel for individual matters.
Today, with Consilio still by our side along with sponsors Baker McKenzie, Yerra Solutions, HighQ, FTI Consulting, and Onit, we published the Annual Law Department Operations Survey Annual Report: Decoding a Decade of Data to Map the LDO Journey. This is the first-ever quantitative look at how the legal ops function has changed, and the single biggest change is the way LDOs interact with outside counsel. Today 36 percent, or more than double the number from 2008, direct or manage their department’s selection of panel counsel. And 28 percent select outside counsel for particular matters, which was almost unheard of a decade ago.
The legal ops function has moved from edges of the law department right to its center: the buying and delivery of legal work. Law departments continue to want to add discipline to their relationships with their firms, while also looking for new ways to provide legal service, such as leveraging alternative legal service providers and technology. Expect LDO professionals to continue to put their foot to the floor accelerate their impact on the delivery of legal services to their companies.
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What else has changed in legal ops and law departments over the past decade? Download the 32-page 10th Anniversary Report — which encompasses more than 100 different data points — to find out.
Brad Blickstein is principal of the Blickstein Group, a consultancy helping businesses serve corporate law departments and law firms. He also is publisher of the Annual Law Department Operations Survey, which for 10 years has provided the most comprehensive data and analysis on the Legal Ops function.