The next frontier in law

KPMG Law's GC Global Conference 2022

The next frontier in law

KPMG Law’s GC Global Conference 2022

Michele DeStefano and Mark Cohen led the charge at KPMG Law’s GC Global Conference, challenging legal leaders to embrace transformation by way of digitalisation, change management, and a client-centred mindset that goes to the heart of service.

Just one day after the world had stopped to witness Her Majesty Queen Elizabeth II as she was laid to rest, lawyers, business leaders and legal innovators came together to meet and share at the KPMG Law GC Global Conference 2022. The mood, while still respectful and reflective, was also one of possibility and potential; things have upended, the world is in geopolitical flux, and those at the forefront of the legal profession must be poised to act.

Delegates were invited to participate in sessions devoted to change led by legal transformation experts Michele DeStefano and Mark Cohen. Mark, Chief Executive Officer of Legal Mosaic, Executive Chairman of the Digital LegalXchange, Distinguished Scholar at Singapore Academy of Law, Forbes contributor and author, made it clear the legal industry as it currently stands is no longer fit for purpose. In a world of rapidly accelerating evolution – enabled by technology, digitalisation, and social and environmental shifts in thinking – legal, he said, has fallen too far behind.

No longer are clients satisfied simply by a functioning legal team as a main industry metric, while expertise in law, reliability, and tech-proficiency should be a given. Traditional law firm structures, bound by old-fashioned hierarchies and pockmarked by inflexible practice areas and knowledge siloes are not fully equipped to meet client needs in a holistic way. The legal profession, said Mark, suffers from misalignment with business, culture and society. It has lost sight of its purpose and needs to find it again.

Change

Consumers have led some of the changes that the legal profession must adopt. We have all come to expect seamless service on demand in all aspects of life, and clients of legal services are no different, demanding end-to-end based solutions, reactivity, a data-driven approach, integration and connectedness. Legal must also look beyond pure legal issues: to understand the needs of a business, its challenges, and overarching strategy. As Mark put it, a lawyer today cannot represent a client if they are not aware of their business challenges.

Yet in a world where 75 percent of change management efforts fail due to poor execution and leadership, how can the legal industry adapt successfully? There is a lot at stake: successful change encompasses big themes including leadership styles, the creation and retention of healthy and diverse teams, firmwide buy-in and management of innovation, and the not-insignificant task of digital transformation.

Michele DeStefano, founder of LawWithoutWalls, author, speaker, consultant and Professor of Law at the University of Miami, suggested the best way to instigate change is by doing “first things first”. Michele began by recounting her first paid job as a 12-year-old magician. Making magic is hard, she said, even when you are only making tiny magic. It might look easy, but it takes time, learning, and practice to perform the art.

Likewise, change is difficult too, she noted, particularly for classically trained lawyers set on risk aversion and precedent and who are statistically of a personality type that tends to be introverted, combative, less open and less trusting. But, echoing Mark’s point earlier in the day, change is a good thing, offering opportunity as well as challenge. Legal providers must be ready and willing to seek out and take up those opportunities.

…the best way to instigate change is by doing “first things first”.

Client-centricity mindset

Both Mark and Michele agreed that change should start with a shift in mindset, with client-centricity at its heart. The question is, how can lawyers be authentically motivated to see the world from this approach?

When we design to solve a problem, Michele said we must learn to examine both who it is we are thinking of, and who it is we are not thinking of. This thought experiment requires empathy – a trait generally not synonymous with legal professionals. Lawyers should seek to understand first, and then strengthen, their own (and their team’s) weaker or missing skills to build the best team to help solve a client’s problem.

Client-centricity means asking the right questions and seeking to deliver a multi-faceted solution that goes to the heart of a client problem. It is collaborative, iterative, agile, digitally articulate and focused not just on meeting a client’s need but actually delighting them with a solution. This is what a client-centric mindset looks like.

Mark championed the concept of agility as being a critical skill for legal providers now. For Mark, agility means an open-mindedness, a drive to be inquisitive, and the ability to connect dots. Design thinking and the theories of the O and T-shaped lawyer are also useful starting points to help expand traditional legal parameters of thought.

‘Innovation’, another of the buzzwords that so often pepper conversations about the legal industry shift, was defined by Mark as a change in mindset, skillsets, and behaviours. For Michele, innovation is about tiny noticeable changes rather than a ‘big bang’ that blows up culture in order to reset it. Change the climate rather than trying to change the entire culture, she said, because culture change is huge, difficult, and takes a long time. Implement tiny, incremental magic which will one day become impactful change.

Understand the business

Michele cautioned it is better to understand the root of a client problem rather than simply offer solutions. She says legal providers must learn to keep asking ‘why’ in order to really get under the skin of a client’s pain points and to understand the wider business challenges. This requires willingness, a 360-degree view, and a sharpening up of the skills required in order to work collaboratively and creatively.

Michele spoke on leadership and asserted that, perhaps contrary to the traditional view, good leaders also often demonstrate the qualities of a follower. A team will feel psychologically safe through empowerment, flattened hierarchies, trust, and having a sense of purpose. Leaders should seek to understand their team to ensure cognitive diversity, discover strengths and weaknesses and be prepared to do what is right for team health – even if that means making unpopular decisions.

Legal Operations: Digital transformation

What role does technology take in this disruption? Legal operations are now firmly entrenched as an integral part of the legal function even though most in-house legal leaders are either neutral or naïve about what digital transformation means and how it enables change.

KPMG’s Global Legal Operations leads Lena Ernlund Malmberg, Nicola Brooks, and Jeff Ikejiri spoke in the afternoon as a panel, sharing insights on reimaging the legal function of the business. Jeff emphasised the importance of turning law from the department of ‘no’ to ‘know’, and moving from cost centre to revenue protectors, while Nicola suggested legal providers no longer offer full bespoke options to clients (“shifting from being private chefs to offering set menus”) as the former is no longer sustainable nor efficient.

The panel agreed that user experience is fundamental, as is the practice of always asking what it is the end user wants. Rather than being seduced by shiny new legal tech toys, the legal department must begin with an understanding of its pain points, working out the nature and scope of a problem before overhauling operations and throwing money into solutions that end up as graveyard tech. Michele elaborated on this point later: on digital transformation, she cautions not to let “the digital tail wag the transformational dog”. First things first.

Change management

Like most big change projects, successful digital transformation requires a process of change management. Jeff noted this process can be reduced by assessing and utilising what the legal function already knows, as “Integration is important across the business, and knowledge should be shared. Look inwards.” He also emphasised the need to focus on people. Walking the halls and talking to your team will allow more adoption sooner, he said, and that means you can show your ROI sooner too.

Data

Michele noted that digital transformation is already well and truly here, along with data and all that it entails. Lawyers must begin to understand what data does and find where data aligns with the legal function’s purpose. Mark encouraged the delegates to see technology as an enabler of the legal team, and data as evidence, rather than as effectively blockages. Mindset, it seems, runs through everything.

“Lawyers must enter the scrum and get their uniform dirty.”

Wider GC concerns

Sessions on ESG (“a new way of thinking to solve the problems caused by old ways of thinking”) and cybersecurity addressed common general counsel concerns, while talent – specifically, how to attract, retain, develop, and to get different capabilities into the legal function – remained an interwoven theme.

David Linke, KPMG International’s Global Head of Tax and Legal, commented that lawyers must possess an understanding of the current geopolitical landscape and how it fits into and impacts upon strategy. Get involved and be prepared. As David put it, “Lawyers must enter the scrum and get their uniform dirty.”

With the legal industry’s challenges clearly articulated and toolkits, best practices, and creative solutions shared, the day’s sessions ended with a drinks reception and dinner. The future is now, as Mark Cohen had boldly addressed the delegates at the beginning of the conference. By day’s end, those poised at law’s new frontier were enlivened, stretched, and ready to play their part in fundamental change.