Key takeaways from the May Legal COO Network event: How operational, financial skills and resources are embedded into firms

The Legal COO Network virtual event in May picked up a theme which has a lot of momentum right now; how operational and financial skills and resources are being embedded into Practice Groups, Departments and Divisions and the shift, in some quarters, of responsibility for operations from the centre out to the business units.

Our assembled COOs and senior law firm managers all contributed to a fascinating roundtable discussion about the pros and cons of a more decentralised approach.

There was a consensus that the larger firms are currently most likely to be adding operational and commercial resources at the practice group level and that mid-sized firms were probably still focused on building up their central support, offering departmental heads better business support from the centre. But also a recognition that a change that starts in larger firms often percolates its way around the legal sector over time.

Here are 10 things we learned:

  • COOs and other central executives find having Business / Commercial Managers at practice group level a real boon; having like-minded people with a stronger grasp of the numbers to liaise with can make life easier
  • Many firms are asking practice leaders to take on more P&L responsibility and make more decisions – one of our COO members told us that their practice heads are now expected to spend at least 25% of their time managing their department. In some cases this drives the demand for full-time business professionals at practice level to provide support for this work
  • Assessing the business case for appointing practice-level business professionals isn’t straightforward – practice groups are often reluctant to carry the additional cost and in smaller firms it is hard to make the case
  • Firm-level executives, like our COOs, recognise the potential for the embedded business professionals to quickly ‘go native’ – becoming partisan advocates and apologists for their department and maybe contributing to inefficiencies by encouraging a silo-mentality
  • Another risk of creating practice-level COOs or similar is that the central COO, CFO and other business leaders find it harder to get time with the practice group head and other senior lawyers themselves
  • Many of our COOs, including those from smaller firms, stressed that harnessing smart business intelligence software to produce analytics and insights into practice group performance was making a big difference to business results, without necessarily needing to deploy extra resources
  • Alongside the emergence of practice group Business / Commercial Managers and COOs, more firms have Secretarial Managers at this level now, taking responsibility for the transformation and reorganisation of legal support that has been triggered by digitisation and accelerated by the pandemic
  • There is a trend towards fewer, larger practice groups in many firms (though not all; one of our COO participants reported his firm had 10 practice groups) and we discussed one large firm case study of a reorganisation down to just 3 global divisions, with each one having embedded Finance, HR and Marketing resource
  • Even in the larger firms there is not a single, inexorable direction of travel in terms of introducing more specialist managers; one contributor made the point that firms tend to experience waves of change and reaction; a period of empowering business professionals can sometimes trigger a ‘give the firm back to the partners’ response
  • We were also reminded that some firms organise themselves on geographical, rather than practice group, lines and it can be tough to shift from one orientation to the other – particularly persuading location leaders to cede total control of ‘their’ resources

The Legal COO Network brings together law firm Chief Operating Officers (COOs) across a spectrum of firms, ranging from some of the largest global players to regional outfits and new model legal companies. Our members are keen to know a bit more about what their peers are doing and to share ideas and experiences in a secure, confidential and friendly environment. The Legal COO Network is sponsored and supported by BigHand and chaired by Chris Bull, Edge International consultant (and former COO).  

Join our next Legal COO Network event, happening 23rd June, 12 - 1 pm BST. We'll be discussing the enterprise-level tools that COOs and CFOs are now required to use at Business Unit level. And how firms are addressing this urgent business critical need.

Register here