By Mike Mather
Now more than ever, developing strong relationships with in-house counsel is vital to success in private practice. In an effort to better predict and control costs, companies are expanding their in-house legal teams and looking for ways to keep more work within their four walls. A recent survey of chief legal officers (CLOs) found that 49 percent of teams expect their outside counsel budget to remain flat for the next year.1 Another 13 percent expected their external spend to decrease year-over-year.2 When asked to identify their top three strategic priorities for the next year, 45 percent of CLOs included “right-sourcing of legal services” on that list; 43 percent cited “cost minimization.”3 To achieve these goals, CLOs expect to seek opportunities for “more efficient use of outside counsel” and other ways to “bring work in-house whenever possible.”4
At the same time, the regulatory environment is only increasing in its complexity. The same survey concluded that two-thirds of legal departments expect industry-specific regulations to create new legal challenges for their organizations in the next year.5 Nearly as many cited state, federal, and international data protection and privacy rules as another hurdle.6
Faced with these pressures, in-house legal departments continue to spend considerable time scrutinizing their outside counsel spend to ensure they are getting maximum value for every dollar. As a result, law firms need to look for ways to provide more than just legal expertise to their corporate client legal teams.
Despite the importance of this relationship, little time is spent identifying exactly how outside counsel can maximize their value to their in-house counterparts and the client they jointly represent. To address this gap, here are ten tips on how firms can more effectively partner with their in-house colleagues.
1) Help “build the bridge.” When I first moved in-house, I called a friend of mine, a well-established general counsel, and asked for some advice on how to manage the transition. His advice: Shift your mindset. “You’re not a lawyer who works in a company. You’re a business executive with legal expertise.” This encapsulates the life of an in-house lawyer. We are asked to bridge the gap between the hyper-technical practice of law and the hyper-practical realities of running a business. This often requires advising on legal risk through the lens of corporate strategy, not the other way around. Accept this, and take the time to understand it. Work to bring the same mindset to the table.
2) Understand the business. One of the most important aspects of effective collaboration with your in-house colleagues is understanding the business environment in which they operate. What is their core product? What are their short-, medium-, and long-range goals? Are you working with an organization hyper-focused on growth, or one looking for strategic gains? What is their risk tolerance, and is it static or situational? Are they sophisticated about their legal needs or novices? Take the time, and make the effort, to get this information—and do it without charge.
3) Understand my role. Understanding how your in-house counterpart fits within the ecosystem of their organization is essential to an effective relationship. In small departments like mine, we must be at least conversant in nearly every area of law. In any given week I may be asked to weigh in on commercial contract negotiations, health care regulation, data privacy and security laws, employment matters, intellectual property questions, licensure requirements, insurance coverage, litigation strategy, and more.
Larger in-house teams present differently. Some have their attorneys organized by subject matter, allowing them to become experts in one area of the law or type of transaction, much like a law firm. Others organize their teams by business unit, freeing them to become experts in a particular product, service, or function. These clients may act more like a conglomerate of small legal departments operating under common leadership at the enterprise level. No matter the size of the organization, understand who you are working with, the resources they have, and how their organization thinks about the legal function, then adjust your approach to meet their specific needs.
4) See the big picture. No legal question is ever asked in a vacuum. By the time they pick up the phone, your in-house counterparts have participated in strategy sessions to understand the business case, internalized the client’s ultimate goal, spent time analyzing how the company’s actions may impact all relevant stakeholders, and given some thought to the legal issues the opportunity presents.
Understand these considerations and tailor your advice and guidance to meet the challenge presented. What’s at stake? From the client’s perspective, is this a small, medium, or big issue? Is the client looking for proactive guidance as it develops a new product, or reacting to a new regulation? Are the rules black and white, or do they leave room for innovation? How urgently is your advice and guidance being sought, and what’s the client’s specific timeline? The answers to these questions are often just as important (if not more important) than the legal one we’ve actually asked.
5) Be practical. To build relationships with our non-lawyer colleagues, in-house attorneys must be practical. Most lawyers can analyze a set of facts, find the applicable statues, and summarize the relevant case law. While these skills are essential to success, it’s a different (and much more valuable) skill to know how those rules apply to the organization you’re advising and its unique values, needs, challenges, and limitations. Our joint client is looking to us not just to tell it what the law is, but how it can apply the law to solve everyday problems with the resources it has—ensuring compliance without unnecessarily hindering growth.
6) Know the parameters (and stay within them). Sometimes, as in-house lawyers, we’re just looking for a quick answer, confirmation of the work we’ve already done, or a gut check of our instincts. In these cases, don’t send a full memo; an email is fine. Your detailed analysis—while undoubtedly well-written—is more than I need, more than I can digest, and (in most cases) more than I am willing (or able) to pay for. Other times, we need to get into the weeds. In these cases, we’re leaning on your expertise to identify all the nuances we couldn’t find on our own. Work to understand our needs in a particular situation and take care to stay within those parameters.
7) Ask questions. Lawyers are naturally inquisitive. Use that to your advantage. While it’s often in the financial interest of in-house counsel to present you with everything you need, no one is perfect. Did we give you enough background information? Do you understand the purpose? The audience? The timeline? The budget? If we’ve left something out, ask for it. Not only will these questions ensure there is alignment; it will also demonstrate your understanding of the challenge, attention to detail, and commitment to the successful completion of the given task, inspiring confidence and trust.
8) Proactively communicate. When I was a very young lawyer, I worked with a partner who had a rule: A client should never send you an email about a file. If they are asking for a status update, you have failed to proactively communicate. While this example may take it to the extreme, the direction of the advice is right. In-house counsel is asked to wear many hats and do many things. When we retain outside counsel for a project, we need to trust that it is in good hands. While we’ll never fully let go, proactive communication provides a peace of mind that frees us to focus our attention in other directions. The more we can trust you will work diligently, competently, and independently to produce results, the more valuable you become.
9) Provide cost transparency. There is no faster way to lose the trust of your in-house counterparts than sending bills that don’t meet expectations. About two years ago, we needed to comply quickly with a new regulation that directly affected our core product. I called one of my outside counsel partners—a large, full-service firm—and asked if they had anyone on staff who had researched the law and, if so, could jump on a 30-minute phone call to answer some initial questions. I was assured that they did, and the following week we had a productive call.
About three weeks later, to my surprise, I received a bill that included not only our call, but hours of research by several junior associates, as well as multiple attorneys billing for an internal meeting to prepare for our call. I was quite irritated and now think twice before assigning work to that firm. Before agreeing to a project, budget, or timeline, ask yourself these questions: How long will it realistically take to produce quality work? Do I have the expertise myself, or will I need to bring in other resources? Does my firm bill for third-party legal research tools? (Tip: It shouldn’t.) Will there be other costs, such as filing fees or other third-party charges, that my client isn’t anticipating?
Spending time assessing what you need to do to deliver a high-quality product and having these conversations on the front end minimizes ambiguity, ensures alignment, and sets you up to ensure you stay on the go-to list.
10) Help me look good. Hey, a little flattery never hurt, right? Remember, just because we work in-house, that doesn’t mean that our client’s expectations change. At the end of the day, our client expects us to deliver timely and sound legal advice in a dynamic environment. We look to our external network to help us achieve that goal. The more I can rely on you to expand my knowledge, provide thoughtful legal analysis, and ultimately help me educate my client to enable them to make the best decisions, the more indispensable you become.
Done right, the outside/inside lawyer combination can be a vehicle to provide unparalleled service. Spending time understanding the unique needs of your client will go a long way toward building an impactful relationship that will directly contribute to earning more business, both from your direct client and from their network of other in-house professionals.
MIKE MATHER is general counsel for HealthEZ, a national health benefits innovator for self-funded health plans located in Bloomington. Before moving in-house, Mike was a shareholder at a law firm in St. Paul, focusing his practice on commercial litigation.
Notes
1 Association of Corporate Counsel, “2023 ACC Chief Legal Officer Survey,” at 21 ACC_2023_CLO_Survey_Report.pdf (last accessed 11/28/2023).
2 Id.
3 Id., at 7.
4 Id., at 33.
5 Id., at 36.
6 Id.