The impact of legal project management on efficiency, technology and collaboration

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Legal Project Management (“LPM”) has developed rapidly in recent years and is transforming the delivery of legal services. Expanding LPM teams are facilitating services for an ever-increasing number of large-scale projects by planning and managing. It is being understood that this requires specialized project management and communication skills. LPMs have now reached the mainstream in the legal sector. This overview will focus on the impact of Covid-19 on legal project management, the door opener approach and the right focus.

Introduction & Story
Having emerged in US and UK firms several years ago, the LPM role and concept has experienced enormous growth and is now being widely promoted by many large law firms. Since its introduction, the LPM function has been consistently striving to improve the traditional legal advice through integrating legal technology and project management skills.

The last year and a half has triggered a number of interesting developments, which we will discuss below.

LPM as a response to COVID and budget pressure/transparency
In many sectors, COVID either led to massive downtimes and collapses or accelerated processes that were already underway. In the legal services sector and especially on large projects, the pressure from clients in terms of budget, transparency and planning increased and triggered a necessity amendment for change. Clients who have been relying on project management themselves for many years and who use their own project management operations (PMOs) expect similar standards from their legal advisors. The most visible aspects relate to proper project planning and pricing – usually in the tender on the request for proposal (RfP). Establishing fixed prices in such a way can help addressing this pressure faced within competitive market conditions. Business development, pricing, LPM and legal teams have worked together superbly to be able to satisfy these requirements.
Also, the importance of transparency, in particular budget and progress updates, has also increased significantly. This means that project teams need to establish and maintain effective communication strategies and a willingness to be more transparent with the client. Consequently, issues will no longer be postponed until the completion of a matter.
Particularly during the critical phases of the pandemic, when enormous numbers of matters were paused and projects cancelled, it became clear how far planning and transparency processes have progressed. Standardized processes, planning capability and sufficient data forming the basis for fixed prices provided a significant advantage during this phase.
The next challenge, whatever form it may take, will come and those who fail to innovate and devote attention to their LPM service will be left behind.

Taking a look at the following issues will help organisations prepare:

  • Work on efficient processes to improve matter transparency by using legal project managers (“LPMs”) and new technology
  • Document matters where being transparent worked well
  • Run presentations with lawyer teams on recurring and one-off issues to explain new processes and tools and their benefits

LPM as door opener for innovation
In the past, innovation projects and process improvements within law firms had often been developed without sufficiently involving the legal teams. This remains challenging with the billable hours continuing to be a central KPI for the lawyers.
With the inclusion of LPMs, a new group of specialists are working on such projects having their basis in innovation teams and at the same time working closely with lawyers on a day-to-day basis helping to shape innovation. This new gateway has demonstrated in recent months that combined technological/process changes, such as the use of collaboration and e-signature tools, can be communicated and implemented more quickly and effectively because of the trust in the LPM community and the fact that they support the legal teams in their daily work, including the implementation and adaptation of new processes and tools.

From our experience, the following should be implemented as a basis for the door opener concept:

  • Embed LPMs in lawyer teams and build trust while supporting matters
  • LPMs need to share experience in both groups, lawyers and internal innovation teams, to increase understanding between both groups
  • LPM needs to use trust and shared experience in order to promote innovative solutions to legal teams and to focus on lawyers’ needs within innovation teams

Focus is key
In the early days of LPM programmes, a central element was to accept and support all types of projects. The main focus was assisting on the largest projects only and on building relationships with the legal teams. Having now successfully managed a large number of matters, LPMs and legal teams have joined forces and new projects are now naturally tackled as a team. As the advantages of working together with LPMs are now increasingly recognized, it is about time to re-focus.
The use and success of LPM services should not be primarily based on billable hours generated. High levels of billable hours are an indication of the involvement of the legal teams, but not of other improvements. This also leads to the approach involving LPMs in client facing way to show the true value instead of using additional back-office resources, which the client doesn’t want to pay for. A key focus is also now the impact on overall pricing and profitability for both, the client and the law firm. This means that improved planning is used to create a realistic budget from the outset, resulting in less frustration for the client and reduced write-offs for the legal team.
It is now time to focus on innovative aspects mentioned above to eliminate inefficiencies. This includes new tools and processes, ideally developed by interdisciplinary teams working together. Another key aspect is to be more specific about the type of projects supported and the depth and intensity of LPM services applied. Since the capacity of LPM teams is limited, the key focus should remain on the largest and most complex matters and also on strengthening and enabling others, for example transaction lawyers and project assistants. While it is true that planning and communication errors tend to result in significant risks in large matters, they shall also be avoided in smaller and less complex matters. However, as LPMs are best utilised in the larger matters, a lighter touch should also be applied to smaller matters as planning and managing a matter efficiently will always benefit both, the client and the law firm’s legal team.

Provided an LPM programme has passed a certain level of implementation, the following three aspects should be reviewed:

  • Analysis of the LPM programme data on supported projects, stakeholders and KPIs
  • Areas for the largest and most complex matters and the major stakeholders advising on such matters
  • LPMs need to focus on reducing financial risks and ensuring appropriate resource management and more transparent communication

The future
The legal sector needs to embrace innovation and the further development of the LPM concept and role to help lawyers focus their expertise on the key legal issues. Technology will allow further improvements and the market, cost-sensitive and competitive as it is, will – in the long run – not tolerate a deviation. It will be a continued challenging but rewarding journey for all wanting to get involved.

jens.gleim@cliffordchance.com

pascal.weber@cliffordchance.com

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