Articles: Organizational Effectiveness Archives

True Collaboration Between Inside and Outside Counsel

More and more, law departments and law firms profess to seek “partnering” relationships. Whatever that term might mean in each context, and the precise qualities it might exhibit in each relationship, it certainly should include significant elements of communication and collaboration.

The communication must be mutual – a healthy dialogue - and it should include subjects that are often unaddressed when companies retain law firms with perfunctory retention letters or representation agreements, which typically address the substance of the assignments with a focus on fee arrangements.

Perceptions Gap

There is evidence that corporate clients and the law firms that serve them do not communicate well. In a recent survey of law departments and law firms reported in Corporate LegalTimes (July, 1998), there was considerable disparity as to how law departments as a group, and law firms as a group, rated the efforts of law firms on behalf of the clients. For example, law firms awarded themselves a grade of B+/A- in response to the question of whether they provide effective and creative preventive legal advice. Their clients, on the other hand, awarded them a C+. As to whether they share the risk with their clients, law firms felt that they deserved a C+, while the clients were willing to assign a grade of only C-. (This was a slight narrowing of the gap from the 1997 survey.) As to whether the firms' charges are commensurate with the value of the service that they provide, the firms felt entitled to B+, while the clients thought that they deserved only a C (a widened gap since 1997.) Firms believe that they are willing to share risk through alternative fee arrangements (they gave themselves a B-), but clients are much less sanguine on that score (they awarded only a C-.) As to communication, firms awarded themselves a B+/A- (up from B in 1997), while clients granted the same B- as they had in 1997.

The survey cited above, which was conducted in 1998 (the 9th annual survey), highlights quite a few examples of mis-communication between clients and their counsel in addition to the few itemized. One major problem is that when corporations retain firms, they are usually well into a case or just about to embark on a project. The work itself commands the attention of both. They dive right into completing the task with minimal attention to the ways in which they will work together and whether the ways in which they worked together in the past are adequate for the present.

Collaborative Meetings

Together, both inside and outside counsel need to step back and assess the need for early discussion and collaboration and how best to bring that about. There are two types of collaborative meetings: 1) with a strong focus on the "relationship", and 2) with a focus on the substance of the work. The latter is better understood and more frequently undertaken. The goals are to share substantive knowledge between outside and inside counsel (and among various law firms involved in the same representation of the client, if that is relevant), and to identify and adopt "best practices: for accomplishing the necessary task most efficiently and cost effectively.

The other type of collaborative or partnering meeting is equally important but usually gets less attention - similar to many "marriages". The purpose is to work out, and work on, the relationship, with the challenge of improving communication. The goals are to align the interests of client and counsel, develop team-based approaches, and establish collaborative and cooperative relationships. This is a greater challenge because there is no cookbook with a definitive recipe for good partnering. The working rules must be developed anew and custom-tailored for each relationship and situation.

Creating the Collaborative Culture

Clients and law firms need ways of sharing information easily and frequently and fostering the type of mutually interdependent relationships that they claim to seek. A myriad of details about a relationship can advance a good, collaborative alliance or, if the specifics of their cooperation are not well planned, hinder such a beneficial partnership. Accordingly, they should devote time and effort to explore the relationship that they will have and how best to make it the mutually beneficial relationship they want to have.

Inside and outside counsel should hold meetings with the express purpose of discussing the specific ways they can work together most effectively. The substance of the work that the firm does (or will do) for the client will be relevant to the discussion (the ways of working together in litigation can be quite different from the ways of working together in completing a business transaction, for example). But the primary focus of the meeting should be how they will share the workload efficiently.

A good deal of advance preparation will assure that the actual meeting time will be well spent. Both inside and outside counsel (first separately) need to identify the hard and soft issues that form the basis for the relationship as a whole and for a particular matter. Data must be gathered (surveys, etc.) and analysis done to identify gaps in perceptions.

The agenda for the meeting should cover the concerns and ideas of both the firm and the client. A facilitated dialogue is the most effective means of achieving the partnering type of relationship that they both seek.

After the facilitated discussion of issues and areas needing improvement, breakout groups of both client and outside counsel should address specific areas for improvement and explore what form the potential improvements might take. It should be a requirement that both sides develop ideas and innovations for improvements and best practices before the actual meeting, so that meeting time can be used efficiently to catalogue and evaluate the ideas. A list of recommendations should be compiled for implementation.

All meetings should conclude with assignments and timetables for implementation. It is, of course, important that there be conscientious follow up, monitoring and ongoing communication among the inside/outside team members. Then, to keep everyone on track and adjust for changing circumstances, periodic update meetings should be held.

Outside facilitators play a valuable role in the collaborative meeting process. Not only do they have expertise in running productive meetings, but also it is essential that the meetings be run in a way that is not threatening to the participants. A neutral facilitator can reduce the defensiveness that can arise easily.

One law firm and one client can hold a collaborative meeting. Whether the firm or the client is the initiating party, such a meeting can engender a very strong sense of teamwork and shared expectations. From the perspective of a firm, it can solidify a good client relationship by building off the pre-existing sense of shared goals. If the client is a new one, the meeting can help the two parties to identify the most productive way that they can work together and, in that way, help create the “partnering” relationship that is the goal for both.

© Phyllis Weiss Haserot and Steven Lauer 1998.