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As stakes get higher, enterprise legal teams find new ways to stay ahead

Markus MikolaThe last two years have seen the world transformed, and the enterprise business world is no exception. In March 2020, the vast majority of companies shifted to remote work almost overnight, business travel came to an abrupt halt, and digital transformation shot up. Since then, new priorities have emerged within organizations. 

Every department has felt the shockwaves from these changes, and enterprise legal teams are no exception. Taken as a whole, they are still finding their footing again in the post-Covid, digitally-transformed “normal,” with all of its implications on governance, risk management and compliance.

In the process, many new trends are appearing, and existing approaches are being magnified and their applications accelerated. Overall, 2022 has opened with some of the biggest changes that legal teams have experienced in a long time. 

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The pace of business has shifted up a gear

We’re growing accustomed to the speed of business that automation can enable, so deals move faster and potential partners won’t wait around. 

On top of that, the pandemic exacerbated stress levels both within and outside the workplace, so pressure is high, and willingness to accommodate delays or mistakes is low. Agile, everyday readiness for due diligence situations is now a must.

To overcome this challenge, legal teams are embracing secure, flexible, remote collaboration processes. Secure cloud document storage, with powerful access controls and integrated e-signatures, is basic practice now, with cloud document creation and sharing solutions built specifically with law teams in mind. 

Legal advisors are becoming strategic partners

According to a recent survey, CLOs spend a significant and increasing percentage of their time advising decision-makers about strategic, often non-legal, issues, such as governance, compliance with diversity, data privacy, or industry-specific regulations, and the potential fallout from political changes. 

As the year moves on, CLOs can expect this trend to grow rather than shrink. 

Governance and transparency are becoming more, not less, important for business success, so legal teams should focus their resources on critical DE&I, sustainability, and governance initiatives.

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‘LawOps’ is booming

An emerging mutli-disciplinary approach to managing law teams, “LawOps” encompasses automation for workflows, standardization of processes with external counsel and more efficient cross-departmental collaboration. 

Organizations have rapidly raised the number of legal operations professionals they employ, with 61% saying they hired at least one in 2021, a threefold increase since 2015, and 21% saying they hired four or more. 

Legal operations employees are expected to focus on cutting costs, improving workflows, and lowering the risk of human error as they choose which LawOps approaches to implement within an organization.

Automation joins the legal team

The use of artificial intelligence (AI) and machine learning (ML) tools by legal teams comes hand in hand with the rise of LawOps and the accelerated pace of business today. Research by Gartner predicts that legal tech budgets will triple to an average of 12% of total enterprise budget by 2025. 

In-house law departments need to make careful tech investments in tools that help them automate tedious legal tasks, raise the quality of legal data, and streamline remote interactions. 

This covers many areas, including contract and entity management, digital signatures, smart tagging and OCR-powered search for digital files. 

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Remote work is here to stay

By this point in the pandemic, it’s a given that remote work works, and that’s as true for legal teams as it is for other professional employees. But for law departments, remote work requires managing a number of highly complex interactions. 

For example, it’s not enough for a law team to collaborate internally on new contract versions; they need a way to share the process with new and existing partners, and sometimes with business rivals, without compromising security levels or losing control of revisions and version tracking. 

Cloud-based platforms are having a real impact, ensuring that everyone in the team is on the same page, redirecting tasks to different team members whenever needed, and updating clients and partners about changing deadlines in order to manage expectations. 

Data and metrics are moving front and center

The use of data by legal teams is nothing new, but with many enterprises striving to cut costs and prove RoI in the wake of the financial impact of the pandemic, law departments are similarly expanding their use of metrics and data-driven insights. The implications on partnerships and SLAs are enormous. 

For example, 65% of in-house legal teams say their organizations have implemented or are planning to introduce metrics to track vendor and outside activities, and 70% say they will be applying metrics to measure efficiency. This includes using formal review processes to assess external counsel performance, RoI on law tech, and expenditure by project and task, amongst others. 

2022 sees enterprise law innovation move into practice

Law departments in 2022 are taking the new technology, trends, and best practices and implementing them more widely and effectively. By embracing data and automation tools and advancing LawOps, legal teams are able to support remote work, move to become strategic advisors, and keep up with the faster, more complex pace of business today. 

Markus Mikola is the CEO of ContractZen, a digital governance platform that helps companies to manage contract workflows, virtual data rooms, business entity files and board meetings. Having worked in tech for over 20 years, Markus is a vocal proponent of using the cloud for streamlining due diligence and business document governance.
 

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