Vahura Insights: What is Legal Department 3.0?

Executive Summary

If the growth of innovation during a crisis were to be measured, the legal industry would serve as a prime example.

At Vahura, where we have a ring-side view on the Indian legal industry, we constantly track the transformation of the legal industry, both from the perspective of the practice and the practitioner.

In-house legal teams are increasingly required to advise their business teams in a manner that is scalable yet personalized, reducing the quantum of work that is outsourced to external counsel, while at the same time dealing with resource and budgetary constraints.

For some organizations, such constraints have become all the more acute during the course of the pandemic, thus leading to the evolution of what we call Legal Department 3.0.

Legal Department 3 0
What is Legal Department 3.0?

Legal Department 3.0 is the third revolution in the evolution of corporate legal departments, where the focus is on being a trusted 'business-enabling' partner rather than simply a 'business-support' partner.

Legal Department 3.0 builds on from Legal Department 1.0, which focuses mainly on talent to to Legal Department 2.0, which focuses on providing legal solutions to business teams on a reactive basis, to the current role of a legal department which is expected to take a proactive and systematic approach to arrive at solutions that are bespoke to the organisation.

It starts by leveraging the digital revolution.

Multiple constraints and increasing responsibilities have compelled legal departments to look inwards and restructure their operating models to include systems, processes, technology and data as intrinstic components of the model. This helps General Counsels (“GCs”) adopt the right strategy, make the right decisions, and preemptively navigate future risks, to become a trusted business partner to the board.

But is a pure tech-driven approach the future of legal departments?

Our experience points towards the contrary. We believe that tech solutions, though immensely helpful, are best suited to play the role of a facilitator as opposed to the role of an enabler, when it comes to the evolving role of corporate legal departments.

While there are several legal-tech solutions that allow for streamlining various processes within in-house teams, adopting the right strategy ("Strategy"), implementing the right systems ("Operations"), and collaborating with business teams to build cross-functional and interconnected project teams ("Interconnectedness"), are the three pillars that Legal Department 3.0 rests on.

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