How to Create a Legal Department Strategy (And Why It Matters)

It’s a challenge almost every legal team faces at some point. Despite the hard work you’ve put into keeping everything on track, your efforts seem to go mostly unnoticed in the broader business. Worse still, it feels like the legal team’s ideas and objectives don’t match up with everyone else’s — which makes it hard to prove the value you bring to the company.

The solution? Take a step back and look at the bigger picture. Crafting a well-structured, forward-thinking legal department strategy can help you mitigate risk, boost efficiency, and manage legal spending. It can also help your team refine the vision of the legal department while enhancing your image within the company and ensuring you’re aligned with broader business priorities.

Here’s everything you need to know to kick things off.

What is a Legal Department Strategy? And Why Does Your Team Need One?

First, it’s worth defining exactly what you’re trying to do before you get started (think of it as due diligence).

An in-house legal department strategy is a structured plan that outlines the legal department’s mission, strategic goals, core functions and focus areas. It also serves as a guiding framework that helps your team to allocate their resources effectively and to deliver value to the larger organization. A well-designed legal department strategic plan helps your team to:

• Communicate the legal department’s value as a business partner to the broader organization
• Create alignment between the legal team and overall organizational objectives
• Develop a shared sense of purpose within the team
• Define clear and achievable goals and objectives
• Effectively manage resources and legal spending
• Deliver efficient legal services
• Proactively manage and mitigate risks
• Leverage technology strategically to streamline workflow
• Prioritize investments into new technologies and resource management systems
• Continuously measure and enhance performance

It’s also essential that your strategy doesn’t just reflect current practices; it should empower your team to proactively plan for future business needs and to scale operations as the company grows.

What Should Be Included in Your Legal Department’s Strategic Plan?

From the list above, you should already be able to pick out some of the core elements to include in your strategic plan. Naturally, exactly what goes in will vary from company to company, but most plans will include the following sections:

Mission statement and goals

Craft a clear, overarching mission statement for your department and specific, measurable departmental goals, which are essential to effectively track progress. When drafting the mission statement, you start by considering what the broader organization needs, how the legal department is currently perceived, and what your team can offer. Next, you’ll need to define the in-house legal department goals and objectives that make the most sense for your team.

Measurable goals for legal departments are those that support their mission statement. For example, suppose your mission is to deliver more efficient, impactful legal services while reducing legal spending. In that case, a specific goal might be to decrease spending on outside counsel law firms by 10% over the next fiscal year.

Risk management framework

Your company faces unique risks – from regulatory changes to industry-specific threats. Identifying and proactively managing these risks is a crucial part of an effective strategy. In other words, if you know there are specific risks incoming over the next few years, like regulatory changes, you should also be preparing for those risks as a vital part of your strategic plan.

Technology and automation roadmap

Integrating technology and automation thoughtfully is one of the best ways to increase efficiency. Consider deploying tools like matter management systems and AI-powered platforms to handle repetitive tasks and optimize workflows. In fact, recent data shows that more than a third of legal departments are already seeing the benefit of using tools like matter management systems and AI to streamline their operations.

However, it is essential to align tech deployments with business goals rather than adopting a “kitchen sink” approach. So, your strategy should also include criteria for evaluating and selecting new technology. If your team has a legal operations professional, this can be a great project for them to tackle.

Resource analysis

To meet the growing demands for legal services within the business, in-house leaders need to consider not only the resources they have today but also the ones they’ll need tomorrow. To that end, your strategic plan should include an analysis that outlines the skills and capabilities of your in-house counsel team and your current outside counsel law firm partners, and projections for what you’ll need in the future.

This “gap analysis” enables you to set out budget expectations with your finance team, and make sure that you’re adequately resourced to meet your organization’s future needs.

Key Performance Indicators (KPIs) and other metrics

KPIs and metrics allow your team to track progress and ensure alignment with broader business goals. For example, the department’s efficiency and contributions to the company can be monitored by tracking metrics like the average time to resolve legal requests or budget compliance.

These performance metrics also help you demonstrate the value of the legal team to other departments. So be sure to include KPIs that are relevant to stakeholders outside the legal department and aligned with overall business objectives and benchmarks.

How to Create a (Great) Legal Department Strategy

Okay, so now you have a starting point for creating your team strategy. But… how do you actually get started? Let’s break it down step by step.

Step 1: Pick your team

Start by recruiting team members who have an interest in shaping the strategy, as well as central stakeholders who bring valuable insights and skills to the process. There may be specific people you want to include (and that’s fine), but it also helps if everyone who is genuinely interested is given a chance to invest in the idea.

In addition, remember that a core goal here is to align the legal team’s strategic priorities with those of other business functions. So make sure the people you include on your strategy team keep that objective at the forefront of your mind.

Step 2: Assess your current state

Next up, take a long, hard look at where things are today. Where is your team really delivering value for the business? And where and why are they coming up short?

Try to gather as much information as you can during this stage by requesting input from team members, reviewing past projects and analyzing your current workflows. It will help if you reach out to members of other teams and consult with business leadership to better understand the organization’s overall strategic direction and plans. Doing so can give you some great insights that are sure to shape your strategic direction.

For example, suppose you find out that legal matters are moving along too slowly to meet the needs of stakeholders, while members of your own team complain that manual tasks are eating up everyone’s time. In that case, automation might form a cornerstone of your strategy.

Other things to take note of at this stage include:

• The skills each legal team member brings to the mix and skill sets that may be lacking
• The legal services your team currently provides and the ones you need to have in place to match the company’s strategic direction and plans for the future

Step 3: Establish guidelines, priorities and KPIs

Based on the pain points that emerged in step two, set the strategic priorities for your plan. These should include:

• High-level priorities, like your general guidelines for how resources are allocated or your ideas for aligning the legal department with other business functions and
• Specific priorities or goals, like reducing the time required for contract reviews.

When it comes to picking priorities, focus your efforts on the most impactful and feasible points to tackle first. For example, suppose your most glaring problem is that your team is often way over budget while one of the company’s priorities is to implement lean operations. In that case, your initial priority might be to implement a solution for monitoring and evaluating legal spending.

This step is also where you can start shaping your mission statement and specific objectives for your team, along with the KPIs or other indicators you’ll use to measure success.

Step 4: Establish timelines and allocate resources

Okay, so now you’ve got your laundry list of what needs to be fixed. Time to settle on a solution for each issue and set some milestones to keep your team on track.

Important questions to ask for each of the issues you’ve identified include:

• How are we going to solve this problem?
• How soon is it feasible to implement the solution?
• What resources do we need to use to implement this solution?
• Which team members are responsible for implementing the solution?

An important consideration at this stage is what tools and approaches are available to help you solve each issue. For example, could you be using AI or software to more effectively manage legal spend? In practice, answering these types of questions is often the starting point for your tech and automation roadmap. But remember to apply any new solutions thoughtfully and to really map out how they contribute to solving a specific problem.

It’s also a good idea at this stage to have an action plan in place for each of the issues you’ve identified. Then, set up regular rhythms for check-ins with relevant team members (and members of other teams), as well as a timeline for implementing each solution.

Step 5: Implement, monitor and improve your strategy

Finally, remember that you’ll need to adapt your strategy based on new information and priorities. A good goal is to strive for continuous improvement, not a set of commandments. Build mechanisms to regularly assess what’s working (and what’s not) and keep your plan flexible so you can make changes as needed.

Remember to also keep checking how your plan aligns with the needs of the company as a whole and be prepared to make changes if things aren’t lining up.

The Pitch: Presenting Your Plan to Other Stakeholders

Once you have an initial draft of your legal strategy in place, it’s time to get more feedback from outside your department. Remember, part of the benefit of a solid strategic plan is that it allows you to demonstrate the value of the legal department to business leadership and to market the value of different in-house legal department functions.

To make the most impact, keep your presentation short and sweet and emphasize factors like:

• Alignment with corporate strategic goals
• Cost savings
• KPIs and other performance metrics

Then, open the floor to questions and be genuinely willing to take suggestions on board. This can be a great opportunity for your general counsel to show that the legal department is flexible, and tofoster a sense of inclusion and buy-in that will make it easier to garner support for your strategic initiatives in the future.

Strategic Decision-making Made Easy

By now, you should have a clearer idea of what it takes to roll out an effective legal strategy. But, let’s be honest, putting it all together can feel a little daunting. The good news? It doesn’t have to be.

Brightflag’s AI-powered matter management platform is designed to help legal teams simplify their strategic decision-making. With Brightflag, your team benefits from instant insights into legal matters, complete visibility into legal work and spending, and a full suite of automation features designed with busy legal teams in mind. All of these factors make identifying and prioritizing important strategic issues a piece of cake.

Ready to see it in action? Book a demo. Our friendly team would be happy to show you how we can help you develop a tremendous legal department strategy. The easy way.