Business runs on data.
The universal language of business comprises benchmarks, KPIs, graphs, metrics and spreadsheets. Legal, however, has historically lagged behind the numbers. While Sales, Marketing and other departments propel themselves with data and analytics, using curated and colorful reports to tell their stories, lawyers have been relegated to using words — and waffling phrases like “Well, it depends.”
That needs to change.
Data is critical to agile, accurate decision-making and building an in-house legal department strategy.
The modern legal team can no longer afford to be left at the gate. At Ironclad, we’ve been on a year-long data journey of our own, and we’re ready to tell our story.
Chapter 1: The backstory
In 2019, Ironclad Legal went through a transition. Our team grew from a department of one — our GC Chris Young — to a team of three. As we drafted our team plans and began charting our course for the year ahead, we faced a key question: what type of legal department did we want to be?
We wanted to be creative.
We wanted to be innovative and redefine the traditional role of in-house legal.
We wanted a front-seat role to shape company initiatives and be active thinkers instead of reactive ones.
We wanted to invest in data and build our department on the principle of being data-driven.
Unsure where to start, we decided to track as much data as possible over the coming quarter. Then we asked, “OK, what is interesting here? Which data points should we add next quarter? What story does this data tell?”
This exercise led to a Legal Team Quarterly Data Report and corresponding company-wide presentation of our findings: our inaugural Quarterly Legal Review, our take on a QBR. It marked our team’s debut as a data-driven department and set the tone for subsequent reports, reviews, presentations and a whole lot of process improvements and changes — data-driven wins, including:
- Tracking quarterly deal patterns to implement a team SLA and better allocate resources during high-deal-volume times where team resources are required for contract negotiation.
- Aggregating year-over-year contract volume data to create a data-backed headcount expansion case.
- Collecting contract redlining information to inform discussions on whether to revise our sales papers to reduce deal friction.
- Using contracting data to actively participate in real-time sales forecasting, placing Legal on the front-line of deals closing and decision making.
We learned much over the past year, earning our stripes through trial and error. The biggest takeaway? Arming the modern legal team with data to operate as an efficient business unit isn’t as scary it seems.
Here are our tips and best-practices for transforming your own legal team into a data-driven team.
Building the story: how and when to collect data
Fortunately, the barrier to entry for basic data collection and analytics is quite low: a computer, a plan and team buy-in.
So, let’s begin. Here are my three cardinal rules for building the pipeline that will tell your team’s data story.
1. Collect data in real-time, early and often.
Waiting until the end of the quarter (or any period) to begin collecting data will overwhelm you. Worse, it will be too late to pivot or tweak your collection system. Result? A pile of work, not much time, and messy data. It’s better to continuously collect data and ensure a full, robust data pipeline for analysis at quarter end.
2. Don’t be afraid to cast a wide data net.
At the beginning of your data journey, over-collect rather than focus too narrowly on validating only assumptions. A wealth of data will paint a picture! If your assumptions are correct, fantastic. If not, that’s even more valuable. You don’t always know which data ends up telling an interesting story — until you have laid out in front of you.
Tip: It’s wiser to over-collect data over time versus under-collecting, which may come back to haunt you when you discover you’re missing key points to tell your story.
3. Set up systems that enable data collection.
OK, we’re bullish on Ironclad, but contract management systems do make collecting contract data and contracting process data easier. With built-in data collection mechanisms, digital contracting helps legal teams to produce comprehensive contracting reports.
A legal intake system is another fantastic way to capture data, with a lower manual lift and higher data quality.
Tip: The sooner you implement these systems and collection methods — even from existing in-house systems — the sooner you build your data pipeline. And that story.
Telling a data story: If you’re not measured, you’re not valued
With your data pipeline full, it’s time to aggregate, analyze and share your story. Adhering to the three rules above, you should be data rich, even if that means multiple spreadsheets intelligible only to you. The power of data is being able to share it with others to tell your story.
Here are my tried and true guidelines:
Choose your metrics wisely, less is sometimes more.
At the end of a full quarter of data collection, you’ll have far more metrics than your colleagues have time (or interest) to review. Tell a powerful and compelling story by presenting your findings strategically. Identify two to three big picture categories — e.g., legal intake, sales workflows, departmental CLM usage — then fill out the categories with two to five curated metrics.
Tip: Make sure all metrics connect to your story cohesively.
Create a readable format for those not entrenched in your data.
To get colleagues (and time-crunched senior leadership) to pay attention to your findings or report, simplify. Select a readable length, provide context and definitions, and supplement metrics with powerful, enlightening graphs. Ask yourself, “Will these terms and metrics make sense to someone who started working at this company two weeks ago?”
Share the report.
Inform your internal partners about your team’s activity (and its importance to the business). Two good approaches: book time during an all-hands meeting to share your findings and showcase your department’s data-driven mission; distribute your report as a quarterly legal review, setting the expectation it’s a recurring initiative.
Create a template.
After publishing your initial report, templatize it. Strip the data but keep the structure for next quarter, so you can plug and play without rebuilding the wheel. Lowering the lift will streamline things and fashion a consistent report, prime for company-wide distribution.
Process improvement: leveraging data to inform actionable insights
You have the data, you’ve told the story — now what? Use your findings to unearth trends and make changes! What areas of improvement has data illuminated? Is your department providing more resources to assist with department X over department Y? Is one workflow requiring a disproportionate amount of time and team energy?
Let data provide the intelligence your team needs to make data-driven decisions and build an in-house legal department strategy. With insights, implement changes and track the impact over the next quarter. Empower your team to move beyond thinking that a process change is working to accurately measuring and showing improvement.
Prologue: the case for data
Our ultimate goal is arming Legal with the same resources and advantages other departments enjoy. And why not? As purveyors of heretos, thereins and shalls, Legal deserves to talk the talk and walk the walk of business, too.
The data-driven legal department is the department of the future. The department that instead of saying, “Well, it depends,” confidently responds, “Well, the data shows.”
Ironclad is the #1 contract lifecycle management platform for innovative companies. L’Oréal, Staples, Mastercard, and other leading innovators use Ironclad to collaborate and negotiate on contracts, accelerate contracting while maintaining compliance, and turn contracts into critical carriers of operational business intelligence. It’s the only platform flexible enough to handle every type of contract workflow, whether a sales agreement, an HR agreement or a complex NDA. The company was named one of the 20 Rising Stars on the Forbes 2019 Cloud 100 list, and is backed by leading investors like Accel, Y Combinator, Sequoia, and BOND. For more information, visit www.ironcladapp.com or follow us on LinkedIn and Twitter.
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