Running a Legal Department Utilizing main Insights from two of my favorite business books: 'Good to Great' and 'Built to Last' which I have recently reread.
They say the most dangerous thing in business is not failure, but being successful without accurate insight as to why. Having the ability to see the truth takes introspection as well as the ability to detach and observe things honestly and sometimes courageously.
Running a legal department in any organization is a complex and exciting task that requires a blend of leadership, strategic planning, and effective management. The principles outlined in Jim Collins' books, 'Good to Great' and 'Built to Last,' provide some valuable insights that can be applied to enhance the efficiency and effectiveness of a legal department.
- Level 5 Leadership: The first principle from 'Good to Great' is the concept of Level 5 Leadership. This refers to leaders who possess a unique blend of personal humility, strong core values, faith that the companies objectives will be achieved and professional will. They are ambitious for the company, not for themselves. In the context of a legal department, this means that the head of the department should be a leader who puts the organization's interests above any personal gains. They should be able to make tough decisions, take responsibility for failures, and give credit to the team for successes. Abe Lincoln, one of the greatest lawyers and wartime leaders of all time is an notable example of a lever 5 leader. They are not flashy, are almost shy and never flashy.
- First Who, Then What: The second principle emphasizes getting the right people on the bus before deciding where to drive it. In a legal department, this means hiring the right team members who are not only skilled but also fit the organization's culture and values. It's crucial to have a team that is committed, adaptable, and capable of working together to achieve the department's goals.
- Confront the Brutal Facts: This principle encourages facing the harsh realities while maintaining unwavering faith that you will prevail. This is known as the Stockdale Paradox. In a legal department, this could mean acknowledging the challenges, such as regulatory changes, budget constraints, or internal conflicts, and addressing them head-on. It's essential to create an environment where everyone feels comfortable discussing the brutal facts without fear of blowback.
- Hedgehog Concept: This principle is about focusing on what you can do best, what drives your economic engine, and what you are passionate about. For a legal department, this could mean specializing in certain areas of law, leveraging technology for efficiency, or focusing on preventive law to reduce litigation risks and implementation of new IP protocols to create flywheels where are not normally expected.
- Culture of Discipline: A culture of discipline involves a consistent system where each team member understands their role and responsibilities. In a legal department, this could mean having clear policies and procedures, regular training sessions, and a robust performance management system. It's about creating a culture where everyone is disciplined enough to do what needs to be done, even when no one is watching.
- Preserve the Core/Stimulate Progress: This principle from 'Built to Last' emphasizes the need to preserve core values while stimulating progress and change. A legal department should have a set of core values that guide its operations, such as integrity, professionalism, speed, sense of urgency and respect for the rule of law. At the same time, it should be open to change and innovation to keep up with the evolving legal landscape.
- Clock Building, Not Time Telling: This principle encourages building an organization that can prosper beyond the tenure of any single leader and through multiple product life cycles. In a legal department, this means building systems and processes that ensure continuity and consistency, regardless of changes in leadership or team composition.
Running a legal department effectively requires more than just legal expertise. It requires strategic leadership, a strong team, a culture of discipline, and a commitment to continuous, steady learning and improvement. By applying the principles from 'Good to Great' and 'Built to Last,' legal departments can enhance their performance and contribute more effectively to their organization's success.