Panel-beating for Beginners – Making Strategic Choices
A key issue for many general counsel is how to appoint, manage and use legal panels. Few in-house teams have the capacity to cover all their organisation’s needs, and almost everyone will engage external resources to help. Much has been written about the how of choosing law firms, setting up panels and buying-in legal services. But it’s equally important to think about what you want to achieve, and, crucially, why. That is the foundation on which a good plan and good relationships rest.
The what and the why
An effective panel serves the strategic direction of the legal team, which in turn serves the strategic direction of the organisation. This clarity gives you two advantages when choosing your panel. Firstly it makes it easier to identify what you need at the earliest stage possible. This saves you a great deal of time. Secondly it means your eventual panel has the highest chance of success at delivering what you need. You are setting yourself up for success.
Identifying and making strategic choices sit at the heart of the GC role. Understanding the business objectives of the organisation, understanding the environment the organisation operates in, horizon scanning for the immediate and long-term risks… these are the areas where you add real value. But such a complex jigsaw of issues means that one size of panel does not fit all. This is not just about sourcing specialist legal advice, either, because even businesses that look similar at first glance have very different issues, demanding different solutions.
Understanding what services are needed to deliver the legal strategy for the business is key; whether it is ultra specialist legal advice, in-house knowledge, flexible additional resourcing, or commodity-based work. The workflows and communication needed to make it all happen seamlessly are the final piece of the puzzle, making something more like a network than a panel.
But whatever choices you make as GC, you remain accountable and responsible for that legal work to the board.
Identifying the issues
Whether you are creating a panel for the first time in a new organisation or refreshing an existing network; everything starts with understanding and identifying the legal issues at stake.
This is a handy list to get you started:
What are the key risks for the organisation?
What is the frequency of those risks?
What is the severity of those risks or the scale of their impact?
What are the key strategic opportunities for the business?
What legal issues are related to those opportunities?
Some issues and risks may be both frequent and obvious in the day-to-day business e.g. does your business model frequently trigger complex employment legislation such as transfers under the TUPE regulations? Others will be less so, e.g. the merger planned for next year, or the new EU regulations on supply chain deforestation. Risks may expand from the legal to political interventions or reputational issues, which all nevertheless come across the GC’s desk.
Check your risk register at the start of the thinking process but remember to consider things which may not yet appear it. For examples issues from legacy operations or inherited risks from acquisitions always crop up when least expected.
The legal team must identify, review and proactively manage all of these and they will almost certainly need a panel (or a network) which supports that work.
Making strategic choices
Put simply, one of the most crucial elements of a GC’s role is to ensure the right legal resources are applied to the right issues. The risks and opportunities list gives you the character of the work needed and the priority of that work. It forms the basis of your next set of decisions.
· What work will be carried out in-house and what will not?
What skills are needed for the work?
Can any legal issues be devolved to the business directly, supported by appropriate tools and training?
What external help is needed from law firms, ASLPs or other providers?
What technology is available?
What processes and policies will ensure work is dealt with effectively and efficiently.
How will duplication be avoided?
How do you capture and use the organisation’s knowhow and prior experience of an issue?
How do you avoid different lawyers tackling the same problem anew and differently each time?
All these are choices which, if captured in a formal legal strategy, can form the foundation for a legal team’s work – and as a means of ensuring what and how it works is adopted and understood from C-suite across the business.
When you understand this, then you are ready to form a panel.