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Can supply chain management concepts be applied to legal services?

In the latest edition of his book Tomorrow’s Lawyers, Richard Susskind says that

The discipline of legal project management should, in my view, be built upon theory and experience from related management disciplines, such as logistics and supply chain management.

Mike Whelan, in his book Lawyer Forward, talks about ‘legal supply chain managers’ and that when starting up a law firm

a supply chain manager should be your first hire.

Or perhaps following on from Susskind: your first hire should be a legal project manager who is capable of applying the concepts and principles of supply chain management to legal service delivery.

But can supply chain management concepts, principles and methods really be applied by legal project managers?

My intention is to write up a short series of posts exploring the feasibility of supply chain management for legal services.

I will make a start in this post by explaining what supply chain management is, focusing on a few key supply chain management concepts.

The most important question to answer at this stage is: can supply chain management concepts be applied to legal service work?


What is supply chain management?

Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products.  It involves the active streamlining of a business’s supply-side activities to maximize customer value and gain a competitive advantage in the marketplace.

This definition about supply chain management was found in this article on Investopedia.

In this post I will discuss the first half of the definition above and I have highlighted a few key words and phrases I want to focus on.

In a later post I will discuss the second part of the definition, including further discussion of legal process improvement. 


What are the ‘raw materials’ that legal teams work with?

I’d suggest the primary source of raw materials legal service teams work with is the law: black letter law (statues and case law), and all the formal rules of procedure which must be followed if the law is to be applied correctly.

The secondary source of raw materials legal teams work with are documents which were not conceived originally as having legal effect.

How might these raw materials be used?

As an example, consider an organization which is purchasing a new software system.

I’d suggest the law concerning software license agreements between supplier and purchaser is relatively straightforward.  Things may become legally complicated if the purchaser requires some bespoke work to be done on its behalf, but an experienced IP lawyer should be able to cope with this quite easily.  A reasonable assumption is that the IP lawyer will find a standard software license agreement to use as a baseline template and adapt the template to fit the needs of this particular client and matter.

There will undoubtedly have been commercial negotiations between the parties during the software selection process.  Lets assume there will be a lot of emails, proposal documents and requirement specifications etc exchanged. These are examples of secondary raw materials of interest to legal service teams.

Practicing lawyers may welcome help from legal project managers in connection with the secondary raw materials.  Hence a legal project manager may become involved in this matter by, for example, liaising with clients and the legal team to make sure that all relevant documentation is received, indexed and put to productive use by the right legal team members at the right time.


Goods and Services

Whatever we purchase is usually a mix of goods and services.

We experience this even when selecting a product from a supermarket shelf and paying for it.  The product is the thing we want to use.  The service element could be, for example, how smooth the checkout process is.

Something similar happens in legal services.  Clients buy a mix of goods and services.

The service element is usually foremost in mind when people think of the work lawyers do.  Service can be broken down into several constituent parts, such as communications with, and accessibility of, the legal team.

The goods which clients buy from lawyers are things like letters of advice, contracts and any other legal and procedural documents which the legal service team creates to complete the matter successfully.

Legal project managers strive to make sure all the goods and services flowing from the legal team are created and performed efficiently, and they are delivered to clients as cost effectively as possible.


Legal Products

Goods and services supplied by legal teams can also be thought of as legal products.

Indeed thinking of all the matter deliverables (i.e., the goods and services) as products helps with matter planning.

As a concept, product-based planning has a long and well-established history in project management.  The concept is referred to in many project management methods and frameworks.  It is sector agnostic and it can (and does) apply to legal service work.

In Prince II, product based planning is defined as:

A technique leading to a comprehensive plan based on the creation and delivery of required outputs.

The technique considers prerequisite products, quality requirements and the dependencies between products.

To help visualize product-based planning in legal services, consider the conveyance (transfer) of a family home.

There are a lot of documents (both electronic and hard- copy) required to convey a house successfully.  Each one of these documents can be considered a component product, each being produced as part of a sequence or process (i.e., the conveyancing process).  Within the process, there will be dependencies, as some documents can be created only after others have been created or received and reviewed.

Taken together, all the products contribute to the end-product sold to clients: the successful legal transfer of a family home.

Doing law differently

As Lucy Dickens explains in ‘Its time to do law differently’ this concept of legal products works best where:

  1. The scope of the legal work being done is clearly defined
  2. There is a system for effective delivery and
  3. The product is sold for a fixed fee.

It is easy to see how the concept of a legal product fits very well with something like conveyancing.  This legal work can be scoped relatively easily, is process driven and can be priced as fixed fee work.

Legal project managers, ideally working alongside specialists in process improvement and pricing can help with all of this.

Please note that I am not suggesting a legal project manager should be appointed to oversee every conveyancing transaction; this would not be practical, proportionate or cost effective.

However there is a role for legal project managers and process improvement specialists to help develop processes and systems which allow for the production of each new conveyancing ‘product’.

One conveyancing product might be the transfer of a family home; another might be transfer of warehouses on industrial estates and yet another might be transfer of farmland.

All the conveyancing products share core attributes, but each product line differs somewhat.

Each matter becomes an instance, or delivery of, a legal product.

More complex legal products

I like the legal product concept and I don’t think it should be confined to relatively small discreet pieces of legal work such as conveyancing.

I’d suggest that even very large and complex legal matters, such as commercial litigation with a lot of interested parties, can be thought of as legal products.

Break even the most complex commercial litigation matter down into phases and it becomes easier to identify the deliverables (component products and services) in each phase.  All legal work, including commercial litigation, should be supported by effective systems and processes in any event while fixed or capped pricing by phase is now quite a common approach in commercial litigation.

In contrast to the high volume work such as conveyancing, it is appropriate to appoint legal project managers to help deliver complex litigation matters successfully.

I suggest that legal project managers in such cases would do well to apply the principles of product based planning and view the matter as a whole as a product, containing many other products (which are component products).


Putting supply chain management concepts into action

Applying fundamental concepts of supply chain management to legal services can be done, but requires a shift in mindset.

We need to think a little less of ‘services’ and more of ‘goods’, ‘processes’ and ‘products’.

In my next post I will look a little deeper into supply chain management.

I will move on from concepts to principles, and investigate how some well-known principles of supply chain management might be applied to legal practice.

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