As businesses and organisations grow, they often face a choice between outsourcing legal work or bringing it in-house. While outsourcing legal work can be cost-effective, it also has certain disadvantages, such as a lack of control over the quality of work, lack of knowledge of the company’s culture and business goals, and dependence on external service providers. As a result, many companies are now choosing to bring more legal work in-house and boost their capacity.
This article will discuss some key benefits of bringing work in-house and strategies to increase internal capacity.
Benefits of bringing work in-house
1. Cost savings
By bringing legal work in-house, companies can reduce their legal expenses significantly. They can cut back on using expensive external law firms and instead rely on in-house counsel on their payroll. Even with matters that require the expertise of a specialist law firm, an in-house counsel can help to ensure that it is well managed to limit cost blow-outs. This can result in substantial savings for the company, especially in the long run.
2. Better quality of work
In-house counsel better understands the company’s culture, business goals, and legal needs, and this knowledge will accumulate over time. They can provide legal advice tailored to the organisation’s specific requirements, resulting in better quality work. Additionally, because in-house counsel works exclusively within the business, they can prioritise the company’s legal needs and respond quickly to urgent legal issues.
3. Increased control
When companies outsource legal work, they have little control over the quality of work or the speed at which it is delivered. On the other hand, an in-house lawyer is accountable to the organisation and can be held to a higher standard of work. Additionally, in-house counsel can work more closely with other departments within the organisation, resulting in better coordination and faster resolution of legal issues.
4. Improved risk management
In-house counsel can provide legal advice on a wide range of issues, from contracts and regulatory compliance to intellectual property and data protection. In-house counsel will also know when to engage external law firms and obtain expert legal advice and guidance. Overall, by utilising in-house legal expertise, companies can better identify and manage legal risks and avoid costly legal disputes.
Strategies to increase internal capacity
1. Hire the right talent
The success of an in-house legal team depends largely on the talent it attracts and retains. Hiring lawyers with the right mix of legal expertise, business acumen, and interpersonal skills is necessary. Additionally, it is essential to provide training and development opportunities to help in-house counsel grow and develop in their roles.
2. Invest in legal technology
Legal technology can help in-house counsel to automate routine tasks, manage legal matters more efficiently, and improve communication with other departments. By investing in legal technology, companies can increase the capacity of their in-house legal teams and free up time for more strategic work.
3. Foster collaboration
In-house counsel must work closely with other departments, such as finance, human resources, and operations. By collaborating with other departments, in-house counsel can better understand the organisation’s business goals and legal needs and provide more effective legal advice. Additionally, by working together, departments can identify legal issues earlier and address them more proactively.
4. Prioritise workload
It is essential to prioritise legal work based on the organisation’s strategic goals and needs. This can help in-house counsel to focus on the most critical legal issues and avoid getting bogged down with low-priority work. Additionally, by prioritising workload, in-house counsel can allocate resources more effectively and manage legal risks more efficiently.
5. Automate low-value tasks
Many in-house legal teams need help managing the high volume of legal requests that come their way. This is where automation capabilities and self-service systems come into play. By implementing these technologies, in-house legal teams can streamline and optimise their legal intake and triage process. This, in turn, can relieve lawyers of low-value and monotonous tasks, allowing them to focus on more valuable tasks.
6. Outsource strategically
While the goal of bringing work in-house is to increase internal capacity, there may still be situations where outsourcing is necessary. It is vital to outsource strategically and only for work that cannot be effectively handled in-house. Additionally, it is important to carefully select external service providers and establish clear guidelines and expectations when outsourcing.
Conclusion
Bringing legal work in-house can provide numerous benefits to organisations, including cost savings, a better quality of work, increased control, and improved risk management. However, to realise these benefits, companies must take strategic steps to increase their internal capacity, such as hiring the right talent, investing in legal technology, fostering collaboration, prioritising workload, automating low-value tasks, and outsourcing strategically.
By taking these steps, companies can build robust in-house legal teams that effectively manage legal risks and support the organisation’s strategic goals. Ultimately, the decision to bring legal work in-house requires careful consideration of the organisation’s needs and resources but can result in long-term benefits for the company.
