March 17, 2023

Five best practices for Legal Project Management

With an ever-increasing focus on efficiency and cost-effectiveness, in-house legal needs need to be well-versed in effective legal project management. Here's how.

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Legal project management is a critical skill for almost all members of an in-house legal team. With an ever-increasing focus on efficiency and cost-effectiveness, it's essential to have a solid understanding of project management principles and how they apply to legal in a business context.

But what skills are needed for legal project management? And what are the best practices that successful legal project managers use to ensure success? In this blog, we dive into these questions and more, exploring the top five best practices for effective legal project management.

We'll also share insights from an interview with a Legal Project Management Administrator, giving you a real-world perspective on what it takes to excel in this crucial role. If you want to start with the foundations, check out our blog on what legal project management is here.

In this article, we will cover the following:

Legal project management (LPM) is the application of project management principles and techniques to legal projects. The concept has gained significant traction in recent years, particularly in the corporate legal world, where in-house legal teams are being asked to do more with fewer resources.

LPM aims to improve the efficiency and effectiveness of legal work by breaking it down into manageable, clearly defined tasks and assigning responsibilities and deadlines to each task.

By doing so, legal professionals can better manage their workload, reduce the risk of missed deadlines, and ensure that all stakeholders are kept informed and updated on the progress of the project.

Building legal project management skills is essential for in-house legal professionals to be able to navigate the complexities of the legal landscape and provide high-quality legal services to their companies. The benefits of developing these skills extend beyond just increased efficiency; it also helps legal professionals to better understand the business context in which their work is being done and to align their efforts with broader organizational goals.

In-house legal teams that are adept at legal project management are better equipped to manage competing priorities, deliver projects on time and within budget, and provide value-added legal services to their organizations. They are also better positioned to communicate effectively with their internal clients, understand their needs and objectives, and provide strategic advice and support that can help drive the desired business outcomes.

In short, legal project management skills are critical for in-house legal professionals who want to excel in their roles and contribute meaningfully to their organizations. Developing these skills requires a combination of training, practice, and the use of tools and technologies that can help streamline legal work processes and make it more manageable and predictable.

Effective legal project management requires a unique set of skills that combine legal knowledge and project management expertise. There are five key skills that are required to execute effective LPM in an in-house environment.

Obviously, in-house legal teams need a strong understanding of the law and legal procedures to effectively manage legal matters. This includes knowledge of relevant regulations, case law, and legal precedents. Legal expertise also includes the ability to analyze legal issues, identify potential risks, and develop strategies for mitigating these risks.

2. Project management skills

To effectively manage legal matters, in-house legal teams need to develop project management skills, such as planning, scheduling, budgeting, and risk management. This includes identifying project goals, defining scope, allocating resources, and tracking progress towards milestones.

3. Communication skills

Project managers spend between 70-90% of their time on communications.

Effective communication is critical for successful LPM. In-house legal teams need to be able to communicate clearly with internal clients, outside counsel, and other stakeholders to ensure that everyone is on the same page. This includes listening actively, asking questions and providing regular updates on project status.

4. Analytical skills

In-house legal teams need to be able to analyze data and information to identify trends, patterns, and potential issues. This includes the ability to synthesize complex information, identify key insights, and make informed decisions based on this information.

5. Leadership skills

Effective LPM requires strong leadership skills, including the ability to inspire and motivate team members, set clear goals, and hold team members accountable for meeting project objectives. Leadership also includes the ability to make difficult decisions, manage conflicts, and build strong relationships with internal clients and other stakeholders - a quality that is becoming increasingly important as the business landscape continues to present challenges in the face of a harsh economic climate.

By investing in these skills, in-house legal teams can improve their effectiveness, reduce costs, and better meet the needs of their organizations.

There are several best practices that can help improve legal project management. Here are the top five.

Develop a project management plan

Developing a project management plan includes setting clear project objectives, defining project scope, identifying key milestones, allocating resources, and establishing a project timeline. By having a plan in place, in-house legal teams can better manage legal matters and stay on track.

Capitalize on technology

Technology can be a valuable tool for improving LPM. There are many software programs available that can help with project management, communication, and collaboration. For example, project management tools like Asana, Trello, or Jira can help track progress and manage tasks, while communication tools like Slack or Microsoft Teams can help team members stay connected and informed. You will also want to explore legal technology tools to better manage your legal matters, such as Newton for your legal entity management.

Optimize collaboration

Communication and collaboration are both important aspects of successful LPM. In-house legal teams should establish clear lines of communication with internal clients, outside counsel, and other stakeholders. This includes regular check-ins, progress updates, and feedback sessions. By fostering communication and collaboration, in-house legal teams can improve efficiency, reduce errors, and deliver better results.

Monitor progress and be agile

Monitoring progress and making adjustments as needed is essential. In-house legal teams should regularly track progress towards project milestones, evaluate project performance, and make adjustments as necessary. This includes identifying potential risks and developing contingency plans to mitigate those risks.

Measure success

Measuring the success of LPM is important for continuous improvement. In-house legal teams should establish clear metrics for evaluating project performance, such as time-to-completion, budget, and stakeholder satisfaction. By measuring success, in-house legal teams can identify areas for improvement and implement changes to optimize LPM.

Understanding the theory behind LPM is critical, but how do these skills and best practices translate into a real business context? David Kearney is a Legal Project Management and Pricing Administrator at Dentons Cohen & Grigsby, and he has been kind enough to share his insights with us.

With a technology management background, David was introduced to the world of LPM when he was involved with the application of project management practices to legal teams.

To strengthen the argument for LPM, David shared a simple example.

“If you’re fighting a case with a $1,000,000 win and you’ve already spent $1,000,000, you know this doesn’t make sense. You're spending more to defend a case than you actually are going to win.

In this example, legal project management and understanding the scope of work is going to dictate how to tackle the case. We know that the client can only spend X amount on this particular matter and if we start running up hourly billing that exceeds that win, it may not be worth it to the client.

Employing legal project management means you will have an understanding of the scope prior to the project and, with this, you know how to best manage that project.”

Over the years, David has noted several key learnings. Here are a few.

Collaboration with your internal clients

David emphasized the importance of collaboration for effective LPM. He explained that when embedding LPM principles in a business, transparent and collaborative communication is key to achieving the right results. For legal professionals working in a business context, you will first need to identify the true goals that your clients want to achieve and then work closely with them to achieve these objectives.

They want good communication. They want alignment between their company and their outside counsel. They want transparency and, overall, they want collaboration.

A focus on predictability

Following the 2008-2009 crisis, the need to better control costs and increase predictability better became apparent. The current economic climate and business landscape has only reinforced this. During challenging times such as these, law firms are asked to reduce and better control costs - and, nowadays, this translates into an in-house legal context too. This need for predictability, as David explained, is something project management principles can significantly support with.

Internal clients generally know what outcomes they are expecting - but oftentimes these are not clearly communicated. It is the responsibility of the in-house legal team to challenge for clarity on desired goals as well as to use the business and legal intelligence that’s available internally to predict the direction and define the scope of projects. This is how LPM can be very impactful when it comes to predictability, helping to define a solid plan as far as pricing and the development of scope if concerned.

The importance of a robust tool

It’s likely that legal professionals working inside companies have a degree of exposure to business tools. From David’s experience, effective LPM relies on a simple but robust project management tool that includes status updates, communication, document sharing, and more. He emphasizes the importance of having a central location where you can go and get that information on a particular matter.

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Summary

In conclusion, legal project management is essential for in-house legal teams to manage their workload and deliver high-quality legal services to their organizations. By adopting best practices in legal project management, legal professionals can improve their efficiency and effectiveness, align their efforts with organizational goals, and provide strategic advice and support.

Legal project management is a critical skill set for in-house legal teams looking to provide high-quality legal services to their organizations. By developing these skills and best practices, legal professionals can become more effective in their roles and make a meaningful contribution to their company's success.

Legal project management means ensuring the effective management of all legal matters. Newton delivers an easy and intuitive platform to manage and automate your legal entities' information, governance, and compliance. If your entity management processes are currently creating friction for your team (which they are for many), be sure to get in touch to explore how Newton can help you have everything you need to be in control of your entity portfolio.

About this article

Sources

Legal Project Management (2019). Who is best placed to act as legal project manager?

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March 3, 2023

What is Legal Entity Management?

Discover the foundations of legal entity management, entity management identifiers, requirements, and the benefits of LEM software.

Dear Legal Ops!
Welcome to this week’s Let’s talk about Legal Ops, offered by Newton. We tackle corporate legal departments, speed up processes, and career growth. Please send us your questions; in return, we come back with real insights and actionable tips.
If you find this post valuable, don't miss the chance to check out our latest posts.

Subscribe to get access to more posts like these!

Join Newton's newsletter to receive our blogs, templates, and the latest information right in your inbox. You can unsubscribe at any time.

As businesses scale and adapt, companies must keep track of an ever-growing number of legal entities. These entities become increasingly complex and include subsidiaries, partnerships, trusts, and joint ventures, each with its own legal and regulatory requirements.

During this evolution, to ensure compliance and effectively manage risk, in-house legal teams are responsible for defining the framework in which their company can operate within the bounds of legal and regulatory requirements. This framework is what we call “legal entity management”; without which companies risk non-compliance, financial penalties, damage to reputation, and operational inefficiencies.

With this in mind, to effectively protect and propel your company, it’s important to understand the wider legal entity management landscape, its role in effective business governance, legal entity requirements, and the benefits of adopting legal entity management software vs more traditional solutions.

In an effort to support the 89% of companies that report facing challenges in managing their legal entities, let’s delve into the details to help you better understand the topic and how it can benefit your in-house legal team in managing legal entities effectively and efficiently.

In this article, we will cover the following:

Legal entity management is the process of managing all the legal entities that make up a company. These entities can include subsidiaries, partnerships, trusts, and joint ventures. This task becomes increasingly complex as your entity landscape expands, and each has its own legal and regulatory requirements.

Legal entity management is the process of organizing, tracking, and managing all the legal entities that make up a company to ensure compliance, mitigate risk, and achieve strategic objectives.

The ultimate goal of legal entity management is to ensure that the business operates effectively, complies with all legal requirements, and achieves its strategic objectives.

Legal entity management plays a critical role in ensuring effective business governance. Effective entity management enables companies to manage their legal and regulatory obligations, including compliance, risk management, and financial reporting. When done well, it also ensures that legal entities operate effectively and that the company meets its strategic objectives.

One crucial aspect of legal entity management is the use of legal entity management identifiers. Legal entity management identifiers are unique codes or numbers assigned to each legal entity within a company which allows for easy identification and management of these entities.

Entity management identifiers are used to track and manage legal entities and are an essential component of entity management. Examples of entity management identifiers include the legal entity identifier (LEI) and the global entity identifier (GEI).

According to a study by EY, 68% of companies report the lack of access to accurate, up-to-date information on legal entities as a major challenge.

The use of legal entity management identifiers can improve compliance, mitigate risk, and improve corporate governance. In addition, legal entity management identifiers facilitate due diligence activities, which can improve merger and acquisition outcomes.

Legal entity management is a critical function for in-house legal teams, but who is responsible for managing legal entities? The answer is not always straightforward and can depend on various factors, such as the size and complexity of the organization, the jurisdiction, and the type of legal entity.

68% of companies report only having 1 to 3 employees involved with legal entity management processes.

Below, we explore the different roles that may be responsible for legal entity management and how they might be involved.

Corporate secretaries

Corporate secretaries are typically responsible for managing legal entities’ day-to-day operations, ensuring compliance with legal and regulatory requirements, and maintaining accurate records. They play a crucial role in corporate governance by providing support to the board of directors, coordinating shareholder meetings, and ensuring the company’s policies and procedures are followed.

The legal ops function is responsible for optimizing the legal department’s processes and systems to enhance efficiency, reduce costs, and improve outcomes. They often oversee legal entity management to ensure compliance with legal and regulatory requirements, improve the accuracy of legal entity data, and mitigate risk.

Paralegals

If available, paralegals can play an impactful role in legal entity management by providing support to in-house legal teams in managing legal entities’ day-to-day operations. They typically assist with maintaining legal entity records, drafting legal documents, and managing compliance with legal and regulatory requirements.

Board of directors

The board of directors plays an important role in legal entity management by providing oversight and direction to the organization’s legal entities. The board ensures that legal entities align with the company’s strategic goals and objectives and comply with legal and regulatory requirements. They also approve significant transactions involving legal entities and monitor legal entity performance.

Management/senior leadership

Working in conjunction with the board of directors, the management team is responsible for overseeing legal entity operations and ensuring they align with the company’s strategic objectives. They also work with corporate secretaries, legal ops professionals, and other stakeholders to manage legal entities’ day-to-day activities, including compliance with legal and regulatory requirements, risk management, and improving performance.

Shareholders

By nature, shareholders have a vested interest in legal entity management as they own a portion of the company. They can influence legal entity decisions by voting on proposals and electing board members who oversee legal entity operations.

Legal entities have various legal and regulatory requirements that must be met to ensure compliance and mitigate risk. Compliance with these requirements is critical to ensure that the company operates effectively, complies with legal and regulatory requirements, and manages risk. There are three core requirements when it comes to legal entity management.

1. Risk mitigation

Legal entity management helps organizations mitigate risk by ensuring compliance with legal and regulatory requirements, managing litigation risks, and protecting intellectual property rights. If you fail to manage risk through legal entity best practices, you risk financial, operational, and brand damage challenges.

2. Compliance

Legal entity management is crucial for ensuring compliance with legal and regulatory requirements, including tax laws, data privacy regulations, and labour laws. Non-compliance can lead to financial penalties, legal liability, and damage to reputation. Effective legal entity management helps organizations maintain compliance and avoid legal and regulatory issues.

3. Achievement of strategic objectives

Legal entity management plays a crucial role in working towards business goals and achieving strategic objectives. Organizations can use legal entities to structure their operations, expand into new markets, and raise capital. Effective legal entity management ensures legal entities align with the organization’s strategic goals and objectives.

To ensure effective legal entity management, companies should consider the following best practices as a starting point:

  1. Centralization – centralize legal entity management to ensure consistency and accuracy across the organization
  2. Automation – automate legal entity management processes to improve efficiency and reduce errors
  3. Standardization – standardize legal entity management processes and procedures to improve consistency and accuracy
  4. Integration – integrate legal entity management with other business processes and systems to improve efficiency and data accuracy
  5. Regular review – regularly review legal entity data to ensure accuracy and relevance

Excel has long been the go-to tool for in-house legal professionals for many purposes, one of which has been entity management. However, as organizations become more complex and regulations more stringent, using Excel for legal entity management is no longer sufficient.

Excel is a versatile tool that can be used for many different tasks, but it is not designed for legal entity management. There are several limitations of Excel that will hold you back if you attempt to use it for legal entity management in this day and age.

Heavily manual

87% of General Counsel report their department spends too much time on repetitive tasks such as legal entity compliance.

While you can write formulae, Excel is still a very manual and time-consuming way to complete the sometimes high-volume but low-value entity management tasks.

Limited data validation

Excel lacks the ability to validate data and ensure accuracy. Without data validation, errors can go unnoticed, leading to compliance issues and operational inefficiencies.

Limited collaboration

Excel is not designed for collaboration, making it difficult for multiple stakeholders to work on legal entity data simultaneously or keep track of version control.

Limited scalability

Excel is not designed to handle large amounts of data, making it difficult for organizations with many and a growing number of legal entities.

Limited reporting

Excel lacks the ability to generate sophisticated reports, making it difficult for legal teams to provide insights into legal entity management.

Lack of data security

As it is not a build-for-purpose platform, Excel does not have the capabilities to meet modern-day data security needs.

As companies scale, Excel becomes increasingly inadequate so businesses must consider more robust solutions for legal entity management.

Outsourcing legal entity management can provide many benefits to companies, including access to expert professionals, reduced costs, increased efficiency, and improved compliance. Outsourcing entity management enables companies to focus on their core competencies and strategic objectives while ensuring that their legal entities are managed effectively and efficiently.

Over 70% of companies expect their legal entity management staffing levels to decrease or remain the same in the next 12 months.

Adopting a legal entity management software like Newton provides companies with a comprehensive solution for managing legal entities in a more automated manner. In turn, this allows in-house legal teams to manage their legal entities more effectively while requiring less time.

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Summary

Legal entity management is a critical function for in-house legal teams. Effective legal entity management can mitigate risk, ensure compliance, and achieve strategic objectives. Legal departments should prioritize implementing best practices for legal entity management including centralizing the matter, automating and standardizing processes, and regularly reviewing legal entity data.

By adopting best practices and, importantly, capitalizing on modern software such as Newton, companies can ensure effective legal entity management, leading to improved outcomes and reduced risk.

Newton delivers an easy and intuitive platform to manage and automate your legal entities’ information, governance, and compliance. If your entity management processes are currently creating friction for your team (which they are for many), be sure to get in touch to explore how Newton can help you have everything you need to be in control of your entity portfolio.

About this article

Sources

EY (2021). The General Counsel Imperative: How can you evolve entity management into effective governance?
ACC (2022). Legal Entity Management Practices.

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Featured CTA blog post: Photo by Jurica Koletić on Unsplash / Photo by Christina @ wocintechchat.com on Unsplash