Inside Counsel: 3 tips for avoiding law department budget cuts

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Inside Counsel: 3 tips for avoiding law department budget cuts

Originally Published in Inside Counsel | By Paul Mandell | May 19, 2014

The threat of department budget cuts is one that hangs over the heads of in-house legal counsel everywhere, no matter the size of the company. However, this does not mean they lack control over the financial fate of their departments when budget season approaches. By following some basic best practices and using their finely tuned advocacy skills in less intuitive ways, general counsel can better position themselves to meet their current and future needs and provide more protection for their companies in the process.

1. Demonstrate efficient performance

First and foremost in maximizing your available resources is effective, efficient performance. After all, if you do not run a tight ship, the company’s senior leadership will be less inclined to allocate more staff and other resources for you to manage. Start by hiring well, and take the time to invest in training your employees. By training the department’s employees to produce high-quality work, you make a strong statement about your willingness and ability to contribute to the company’s bottom line. Moreover, you should always be on the lookout for opportunities to minimize expenses through strategies like the use of alternative fee arrangements and automation of transactional work.

As you work toward a higher level of departmental quality and efficiency, be sure to take the time to listen and learn. Determine exactly what is expected of you from the CEO and other senior executives — even if you feel that you have a firm grasp on what is expected of you and your team — and ask what more you can do for the business. By engaging in this practice routinely, you will maintain a clear understanding of the current company mission, as well as how best your team can have an impact.

2. Educate your colleagues

Another strategy to maximize your department’s resources is educating your senior executive peers from other departments. Take steps to inform your colleagues about the legal risks and opportunities facing the business. In doing so, frame the issues in financial terms, which will help your non-lawyer peers draw clearer connections between those risks and opportunities and the work of your team. Putting the work of your department in context will inevitably help others to understand more vividly the significance of the legal team and its impact on the company.

In addition, in educating your colleagues, you should take advantage of the opportunity to share any of your teams best practices or effective solutions to problems that are applicable to the work of other departments. By sharing your success stories and efforts to innovate, you will gain new supporters of the legal department, as well as a stronger departmental brand.

3. Advocate for the resources you need

One additional critical step to protecting your budget is advocating for your team. Despite the fact that this strategy aligns well with their legal skills, training, and experience, many legal department leaders struggle with advocating for themselves and the needs of their team. The process of advocating for the resources you need is what ties the other steps together, making it essential. Although your team may understand the risks facing the business and what it is that the legal team does all day, you will rarely receive what you need if you don’t ask for it and make a reasoned argument to justify your requests. If framing your legal team as an asset of the business is a struggle for you, consider speaking to the marketing department as a starting point. It cannot hurt to seek input from internal experts regarding how you can build a compelling case for the legal department’s value. Take the positive brand you have built for yourself and your team, and promote it with a call for sufficient support. By pushing aggressively for what you need, you will both keep your department moving forward and do the best you can to support the business.

Constant pressure to preserve the level of available resources is a reality of law department management today, and every chief legal officer must spend considerable time and effort focused on resource optimization. Fortunately, by running an effective department and using strategic education and advocacy, you can put yourself in a better position when it comes time for the next allocation of the company’s limited resources.