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“It’s a constant evolving cycle, but actually it does make the legal department more of a business partner and more of a risk manager”.

While the in-house legal community continues to grow in strength and numbers and examples of in-house counsel with increasing influence in their organisations are more prolific, often the impact of the legal department can still be muted. What’s more, while there is plenty talk of “demonstrating value” – few employing organisations or in-house counsel themselves can clearly articulate their value beyond cost reduction.

In this TED-style presentation, Ian Leedham, Head of Legal at Euro Car Parts discusses the importance of using metrics to show the value of your legal team. He covers what metrics to use, where to find the data you need and how this can align your legal strategy and show you are managing risk effectively.

Importantly he focuses on the role of data and metrics as a powerful tool to tangibly communicate the value of legal beyond cost reduction – and make a difference to the performance of the legal department.

Is it about measurement or changing performance?

Drawing inspiration from the way we individually process hard data every day through the likes of fitness watches and smart meters, he highlights how data influences and impacts the way we do things every day to change our behaviour and improve our performance. 

This should be no different for legal departments who can leverage data to identify trends and in turn, change these trends. Key is how the data is presented. Dashboards are the new black and visual impact is critical. A single powerful slide to communicate the critical information.

“In the past, in-house legal counsel could’ve been metaphorically viewed as 16^th century ‘ship captains’, who would dispense advice or orders.” Ian explains this world has changed. While many lawyers make the switch in-house to avoid the constant reporting against metrics prevalent in private practice – numbers in-house matter. Just in a different way.

Increasingly in-house counsel must justify answers to issues using data. Litigation and insurance being prime examples where using numbers can be effective to create decision-making trees or providing probability outcomes. In-house counsel need to become more savvy using data according to Ian.

But which metrics to measure?

Acknowledging that there are hundreds of things in-house counsel could measure, he reiterates that measuring everything doesn’t necessarily have value. “Everything that can be counted doesn’t necessarily matter. Somethings that you can’t count do matter”. 

Ian recommends starting with the right questions. What’s the objective? What are you trying to show? What do you want this data to support? How is that meeting the overall objective?

Is there a final frontier?

This is not a one-off exercise. Rather it is a constant evolving cycle. Ian emphasises that when you start to measure things that firstly you must then make changes to how you work because of insights learned. Secondly there may be unintended consequences you didn’t thin of that you will need to correct for.

Ultimately in Ian’s opinion, in-house counsel can use metrics to stop issues from reaching the legal department and “preventing things from becoming a problem”.  That is the best solution for all and something all in-house counsel should strive to.

“The key takeaway for me is the importance of metrics and data to enable legal teams to show their value to customers within the business.” - John, Network Rail.

This presentation was part of our inaugural #CraftyLexis Masterclass, in collaboration with Crafty Counsel. The event attracted GCs from across several industries. It explored how in-house counsel can demonstrate, articulate and deliver value within their organisations in effective and innovative ways through a mixture of punchy, TED-style presentations and facilitated interactive workshops which encouraged peer discussion, learning and sharing of best practice.

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Additional recommended reading:

- this Practice Note considers how to measure and report the performance of the in-house legal team in an effective and meaningful way

 - in this practice note, we develop a simple schematic to help identify, establish and manage a key performance indicator. In this case, the indicator is about shortening the life cycle for contract negotiation